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High Court of Australia |
THE QUEEN v. FEDERAL COURT OF AUSTRALIA; Ex parte W.A. NATIONAL FOOTBALL
LEAGUE [1979] HCA 6; (1979) 143 CLR 190
Constitutional Law (Cth) - Prohibition
High Court of Australia
Barwick C.J.(1), Gibbs(2), Stephen(3), Mason(4), Jacobs(5), Murphy(6) and
Aickin (7) JJ.
CATCHWORDS
Constitutional Law (Cth) - Powers of Commonwealth Parliament - Trading corporations - Incorporated football club and football league - Purpose of formation - Activities - Interstate trade and commerce - Clearance of football player from club in one State to play for club in another State - The Constitution (63 & 64 Vict. c. 12), ss. 51 (i.), (xx.) - Trade Practices Act 1974 (Cth), ss 4 (1), 6, 45 (2), 80 (1) (d), (h) - Associations Incorporation Act, 1895-1969 (W.A.), ss. 2, 3, 6 - Associations Incorporation Act, 1956 (S.A.), ss. 4, 12.Prohibition - Federal Court of Australia - Jurisdictional facts - Right of appeal to High Court - Relevance to prohibition - Court's discretion - The Constitution (63 & 64 Vict. c. 12), ss. 75 (v.), 76 - Judiciary Act 1903 (Cth) ss. 33 (1), 38, 40 - Federal Court of Australia Act 1976 (Cth), ss. 5 (2), 19 (1), 32 (1), 33 - Trade Practices Act 1974 (Cth), s. 163A.
HEARING
Sydney, 1978, June 14, 15;DECISION
1979, February 27.2. In 1973, he resided in the geographical area assigned by the Western Australian National League ("the State League") for the purposes of the playing of Australian Rules football in Western Australia to the West Perth Club ("the Club"). Consequently, he was registered as a player with the Club. He has trained with it since 1973 and has played successfully in its senior team being paid by the Club a fee for each match in which he played: but no formal contract of employment governed any such payment. He also played in a team representative of the State of Western Australia in the National Australian Rules competition conducted by the Australian National League ("the National League"). (at p194)
3. However, having failed this year to make with the Club the written contract he desired and having had an offer to play with the Norwood Club in South Australia, he moved his residence to the latter State. But, because of the relevant rules of the National League adopted both by the State League and the Club by their respective rules, he could not play with any club playing Australian Rules other than the club with which he was registered except with the consent of the National League, expressed through a "clearance". The Norwood Club could be penalized in competition points in the competition conducted by the National League if it played the respondent in one of its teams without the grant of such a clearance. Seemingly, the grant of a clearance by the National League is made either after consultation with or at the instance of the State League and also with concurrence of the Club. It seems that, generally speaking, it would be refused if the Club objected to its grant. It is unnecessary for the purposes of these reasons to detail the rules governing the need for and the grant of a clearance: it is sufficient to enable appreciation of the point the Court is now asked to decide to observe that the rules accepted by the respondent in joining and being registered with the Club preclude him from playing in the code with any other club without a clearance. I understand that on occasions such a clearance may be granted to a player upon the payment by the club to which the player transfers his registration to the club from which he is cleared of a sum of money, often of substantial proportions, none of which as a rule goes to the player. (at p195)
4. The respondent was refused a clearance. Consequently, he has not played with the Norwood Club. He applied to the Federal Court of Australia for orders against the State League and the Club which, if granted, would in substance compel the grant of a clearance or at any rate allow the respondent to be played by the Norwood Club without competitive disadvantage to that club. He alleged that the State League and the Club in refusing the clearance were acting in breach of the provisions of the Trade Practices Act 1974-1977 (Cth) ("the Act"). He based his application upon ss. 6 (1), 45 and 80 (1) (d) and (h) of the Act. (at p195)
5. Principally, the respondent's case, according to his affidavit filed in the Federal Court, is that the State League and the Club are trading corporations formed within Australia bound by the provisions of Pt IV of the Act and in relation to the requirement and refusal of a clearance are in breach of the Act. It is unnecessary for present purposes to examine the manner in which the respondent seeks to make good his claim that the State League and the Club are in breach of the Act. The respondent makes an alternative case to which I later refer. (at p196)
6. Part VI of the Trade Practices Act gives jurisdiction to the Federal Court to enforce Pt IV of the Act, which contains s. 45. By s. 80, in Pt VI, the Federal Court is empowered to restrain conduct which constitutes or would constitute a contravention of a provision of Pt IV. By s. 86, the Federal Court is given jurisdiction to hear and determine applications for orders under s. 80. Its jurisdiction in this respect is expressed to be exclusive of the jurisdiction of any other court than that of this Court under s. 75 of the Constitution. Thus the Federal Court has jurisdiction by its order to restrain a trading corporation formed within the limits of the Commonwealth within the meaning of the Constitution from acting in breach of the Act. It also has jurisdiction to restrain a person, natural or juristic, from acting in breach of the Act to the extent that the relevant act or acts is or are done in the course of or in relation to trade and commerce among the States. (at p196)
7. The application by the respondent to the Federal Court was due to be heard by that Court on 14th June. However, on 6th June, the Chief Justice at the instance of the State League and the Club (the prosecutors) made an order nisi for prohibition to restrain the Federal Court from proceeding with the respondent's application for the orders he sought, upon the ground in substance that that Court lacked jurisdiction to make any such order because neither of the prosecutors is a trading corporation within the meaning of s. 51 (xx.) of the Australian Constitution or, because in relation to the refusal of a clearance to the respondent, neither of them was engaged in interstate trade and commerce. Proceedings in the Federal Court were stayed meanwhile. (at p196)
8. The order nisi was returnable before the Court on Wednesday, 14th June. Affidavits on behalf of prosecutors and respondent and exhibits thereto were filed and read to the whole Court which constituted the bench to hear the application for an order absolute for prohibition. At the conclusion of the argument, the Court lifted the stay of proceedings in the Federal Court, thus enabling those proceedings to continue: otherwise, the Court reserved its decision. (at p196)
9. Section 45 of the Act, apart from the operation of s. 6, is, constitutionally based on s. 51 (xx.): and so far as affected by s. 6 (1), is so based on s. 51 (i.). These paragraphs of s. 51 of the Constitution respectively give legislative power to the Parliament with respect to interstate trade and commerce and with respect to foreign corporations and trading and financial corporations formed within the limits of the Commonwealth. (at p196)
10. As I have formed a definite conclusion that the prosecutors are trading corporations within the meaning of the Constitution and that, for that reason, the order nisi for prohibition should be discharged, I do not propose to examine in detail the alternative submissions made by the respondent, namely, that the conduct on the part of the prosecutors of which he complains occurred in relation to interstate trade and commerce and that, in any case, there is jurisdiction in the Federal Court to entertain the application against at least one of the prosecutors on the footing that it was an accessory within the scope of s. 80 (1) (h) of the Act. Nor shall I express any view on the question whether what I hereafter say with regard to the ability of the Federal Court conclusively to determine whether the prosecutors or one of them is a trading corporation applies equally to the Federal Court's ability so to determine whether either of the prosecutors is relevantly engaged in interstate trade and commerce. (at p197)
11. But I ought to say on the first of these alternative submissions that the refusal of a clearance plainly was not, in my opinion, in relation to interstate trade or commerce, however much the lack of it precluded the respondent from playing the code in another State: and, as to the second of the submissions, that unless at least one of the prosecutors is a trading corporation in breach of s. 45, there can be no room for treating either of them as accessories. Thus it seems to me there is in reality no separate and alternative basis on which to deny the jurisdiction of the Federal Court to make the orders sought. It must be challenged on the footing that in truth neither of the prosecutors is a trading corporation as described in the Constitution. Consequently, from here on my remarks so far as they relate to the substance of the matter are confined to the question whether either of the prosecutors is a trading corporation within the constitutional legislative power. (at p197)
12. There can be no doubt that both the prosecutors and, for that matter, the National League are corporations. The first two are registered under the Associations Incorporation Act, 1895-1969 (W.A.) ("the Associations Act") and consequently incorporated: see s. 3 of the Associations Act. The National League is incorporated under the Companies Act 1961 (Vict.). I might mention in passing that the Norwood Club is incorporated under the Associations Incorporation Act, 1956 (S.A.). (at p197)
13. The relevant sections of the Western Australian Act - mirrored in the South Australian Act - are: (at p197)
14. Section 2, specifying the associations which may be for incorporation. (at p197)
15. Section 3, which provides for the issue of a certificate of incorporation which evidences the due incorporation of the association. (at p198)
16. Section 6, which effects incorporation upon the issue of a certificate of incorporation. (at p198)
17. The prosecutors are each an association within the description in s. 2, subject to the effect of the proviso to that section which provides: "Provided that this Act shall not apply to associations for the purpose of trading or securing pecuniary profit to the members from the transactions thereof", Each of the prosecutors has been issued with a certificate of incorporation which evidences that the association is incorporated. Presumably it was granted upon a certificate of the Attorney-General complying with s. 2. The incorporation under the Associations Act provides for a common seal and for the power to purchase and hold property. That Act places no limitation upon the activities of the incorporated body. It relies on the official control of the grant of a certificate of incorporation to preclude associations which do not qualify under the definition in s. 2 from achieving incorporation. It makes no attempt to limit their capacity once incorporated. The powers of the corporation will be found in the rules of the association. Any question as to the validity of an act of the corporation must be settled upon consideration of those rules. (at p198)
18. It may be, though I do not decide, that the incorporation of an association which has received a certificate of incorporation though it did not qualify under the definition could have its certificate of incorporation revoked or set aside by a competent court. But, in my opinion, until that, if it can happen, has happened, the incorporation is effective. (at p198)
19. We heard an argument that the incorporation of the prosecutors was of a limited nature. It was submitted that by reason of the proviso to the definition of "association" in s. 2 the Associations Act could not apply to an association for the purpose of trading whether or not pecuniary profit was distributed to the members of the association. It was then said that if an association which had been incorporated under the Associations Act did so trade, it ceased in relation to that trading to be a corporation, though remaining so for other non-trading purposes. I have thus expressed what the argument, obscurely expressed, was, it seems to me, intended to submit. This submission, even if its construction of the proviso to s. 2 were correct, was not merely novel but patently unsound. A somewhat similar suggestion made in the argument of Williams v. Hursey [1959] HCA 51; (1959) 103 CLR 30 was dispatched by Sir Wilfred Fullagar, by saying that "The notion of qualified legal capacity is intelligible, but the notion of qualified legal personality is not" (1959) 103 CLR, at p 52 . I respectfully agree with Sir Wilfred's summary rejection of the proposition. Acts done ultra vires do not impinge upon, lessen or deny the corporate nature of the body concerned. (at p199)
20. But, in any case, the construction placed by counsel on the proviso to s. 2 is, in my opinion, erroneous. What the proviso intends to exclude from the operation of the Associations Act are associations which are formed to trade for the profit of its members. The language of the proviso should be read as a whole and not in self-contained segments. It is not the purpose of entering into trading transactions which is intended to disqualify: the disqualification is in the purpose of gaining by trading or otherwise pecuniary profit for the members. (at p199)
21. Further, as I have said, it seems to me that if an association which fell within the proviso were issued with a certificate of incorporation, it must be deemed, at least so long as that certificate is extant, to be a corporation. Although not so said in express terms, the Associations Act in reality makes the certificate of incorporation conclusive evidence of the corporate personality of the registered association. I therefore reject the submission that either of the prosecutors is not a corporation formed within the limits of the Commonwealth. (at p199)
22. The definition of a trading corporation for the purposes of the Act is tied to the constitutional language of s. 51 (xx.): see s. 4. (at p199)
23. It is no doubt convenient to the Parliament and the parliamentary draftsman to avoid the risk of the unconstitutionality of a statute by using statutory definitions expressed in terms of the relevant constitutional power. By so doing, no question of the constitutional validity of the Act itself will arise so far as it concerns matters related to and dependent upon the statutory definition. But in the long run such a course may well prove highly inconvenient and costly to those affected by the statute. As in this case, the citizen may find himself litigating a constitutional question of some dimension. If I may venture to say so, it would be better if the Parliament and its draftsman assayed a definition, e.g. as in this case of a trading corporation, which covered those described bodies which the Parliament wished to embrace within the operation of its legislation, making for this purpose its own judgment of the ambit of its constitutional power. It may well be that the Parliament, in specifically defining those whom it desires to affect by its statute, may not exhaust its constitutional power: or, of course, it may be, in enacting its definition, it may exceed that power. But if it does, and it is careful to leave room for severance or a distributive operation, the statute will embrace those whom constitutionally it may affect even if it fails for lack of power to affect others who fall within the statutory definition. (at p200)
24. However, as I have indicated, the Parliament, by using the constitutional language in its definition of "trading corporation", has left it to this Court either initially, as is proposed in this case, or ultimately, on appeal or by prohibition or certiorari, after a decision of the Federal Court, to determine the constitutional question whether the litigant comes within the constitutional power. Consequently, this Court may at some stage in the proceedings commenced in the Federal Court be called upon to decide whether a corporation which is sought to be affected by those proceedings is a trading corporation within the meaning of the Constitution, which the Court for this purpose must construe perhaps, though not necessarily, exhaustively. (at p200)
25. In my opinion, both for the constitutional and the statutory competence of the Federal Court to enforce s. 45 in its express terms, the body sought to be affected by the proceedings must, in relation to the present circumstances, be a trading corporation within the ambit of the constitutional power with respect to trading corporations formed within the limits of the Commonwealth. Two questions are raised by the application for prohibition, namely: (at p200)
26. 1. Whether, if neither of the prosecutors is a trading corporation so that the relevant sections of the Act constitutionally cannot apply to or bind them or either of them with the consequence that the Federal Court lacks jurisdiction to make the orders sought in the proceedings before it, this Court can, at any stage of those proceedings, and in particular at the present stage, and, if it can, whether it should, grant now prohibition to restrain the hearing of those proceedings. (at p200)
27. 2. Whether either of the prosecutors is a trading corporation. (at p200)
28. The Court is not concerned in this application with the question whether or not the prosecutors, or either of them, if bound by the Act, is in breach of its terms. Apart from the procedural question as to the grant of prohibition to the Federal Court, the sole question is whether either of the bodies sought to be affected by those proceedings is a trading corporation. (at p200)
29. I would first deal with the procedural question. Section 75 (v.) of the Constitution gives to this Court jurisdiction to grant prohibition to a federal officer. This is a large and most important jurisdiction. The judges of the Federal Court are federal officers: see R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Whybrow & Co. [1910] HCA 33; (1910) 11 CLR 1 ; R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Brisbane Tramways Co. Ltd., ("the Tramways Case (No. 1)" [1914] HCA 15; (1914) 18 CLR 54 . This power, as Griffith C.J. observed in the latter case, cannot be taken away from the Court "by any form of words or any device" (1914) 18 CLR, at p 59 . The Court should itself be jealous to preserve and maintain the scope of the power. (at p201)
30. Further, s. 38 of the Judiciary Act 1903, as amended, passed in pursuance of s. 76 of the Constitution, gives this Court jurisdiction in matters in which a writ of prohibition is sought against a federal officer or a federal court. Section 33 (1) of that Act expressly gives to this Court power to make orders or direct the issue of writs requiring any court to abstain from the exercise of any federal jurisdiction which it does not have. (at p201)
31. This jurisdiction, whether derived from the Constitution or from the Judiciary Act, is exclusive of the jurisdiction of the several courts of the States and is excluded from the general investiture of State courts with federal jurisdiction which s. 39 of the Judiciary Act effects. Thus, no court of a State has jurisdiction to entertain or to grant an application for prohibition to a federal officer or a federal court. (at p201)
32. The use of the word "prohibition" in s. 75 (v.) imports into this Court's
jurisdiction the law appertaining to the grant of
prohibition by the King's
Bench. Some aspects of
that law are, in my opinion, presently relevant. The
essential nature of the writ
of prohibition as described by Brett J. in
Worthington
v. Jeffries (1875) LR 10 CP 379, at p 382 , in a passage cited by
Griffith
C.J., in the Tramways Case (No. 1) (1914) 18 CLR, at p
60 is of
relevant and fundamental importance. Having referred to prior decisions,
his
Lordship said (1875) LR 10 CP, at p 382 :
"These authorities shew that the ground of decision, in considering
whether prohibition is or is not to be granted, is not
whether the individual
suitor has or has not suffered damage, but is, whether the royal prerogative
has been encroached upon by reason
of the prescribed order of administration
of justice having been disobeyed. If this were not so, it seems difficult to
understand
why a stranger may interfere at all." (at p201)
33. The grant of the writ of prohibition is discretionary if sought by a
stranger or if the want of jurisdiction does not appear
on the face of the
proceedings: see judgment of Willes J. in London Corporation v. Cox (1868) LR
2 HL 239, at p 283 . But if, though
not apparent on the face of the
proceedings, lack of jurisdiction is made out to the satisfaction of the court
the discretion to
grant the writ may be exercised so soon as proceedings are
taken. (at p202)
34. The existence of a right of appeal, even to this Court, cannot be a bar to the grant of the writ: see the Tramways Case (No. 1) (1914) 18 CLR, at pp 61-62, 64, 65 : also, Mooney v. Commissioners of Taxation (N.S.W.) [1905] HCA 61; (1905) 3 CLR 221, at p 236 . The grant of prohibition is an exercise of original jurisdiction and not part of the appellate process. An appeal, even when lack of jurisdiction may afford a ground of appeal, cannot be a substitute for prohibition, nor its existence an inhibition on the exercise of the power to grant prohibition. How far, if at all, the existence of such a right may affect the exercise of the discretion to grant the writ will be discussed later. (at p202)
35. Prohibition to restrain the commencement or continuation of proceedings is an appropriate remedy to be granted for manifest want or excess of jurisdiction. It may be granted before a decision has been given or it may be granted thereafter to restrain proceedings upon the decision or order. After the decision or order has been given or made, certiorari to quash may be granted where nothing remains which could be prohibited. (at p202)
36. In matters which do not involve constitutional competence there is often a question whether the statute which gives jurisdiction has also given the court or tribunal jurisdiction conclusively to determine the existence of any fact or situation upon the existence of which the statutory jurisdiction depends: e.g. Parisienne Basket Shoes Pty. Ltd. v. Whyte [1938] HCA 7; (1938) 59 CLR 369 . But such a question cannot arise if the jurisdiction depends on constitutional legislative power to create it. Where constitutional competence to create the jurisdiction depends on the actual existence of some specific fact or situation the court or tribunal, though it may form a view as to whether the fact or situation exists, is not competent to decide that in truth either does exist: only this Court may conclusively determine the actual existence of the fact or situation which grounds the constitutional power. (at p202)
37. This Court has consistently taken the view which I have just expressed. See the line of cases beginning with R. v. Hibble; Ex parte Broken Hill Proprietary Co. Ltd. [1921] HCA 15; (1921) 29 CLR 290, at p 299 , and presently ending in the recent case of Reg. v. Heagney; Ex parte A.C.T. Employers Federation [1976] HCA 32; (1976) 137 CLR 86 . These cases have been concerned with jurisdiction depending on s. 51 (xxxv.), i.e. upon the existence of an industrial dispute extending beyond the limits of any one State. But, in my opinion, their reasoning is equally applicable to the case of jurisdiction depending on s. 51 (xx.), i.e. as in the present case, upon the existence before the court or tribunal of a trading corporation within the meaning of the Constitution, which is sought to be subjected to a law made under s. 51 (xx.). The fundamental reason why this Court has entertained applications for prohibition to the Commonwealth industrial and arbitration tribunals is that, because of the restricted language of s. 51 (xxxv.), the Parliament cannot validly confer jurisdiction upon such a tribunal except in relation to an industrial dispute actually existing which satisfies the constitutional language of that paragraph. Equally, the Parliament has no constitutional power to confer on a court or tribunal a power to make orders requiring a corporation which is not within the constitutional language of s. 51 (xx.) to observe the terms of a statute depending for its validity upon that paragraph of s. 51. (at p203)
38. The Parliament might, in respect of either legislative power, create a tribunal which, as an incident of its jurisdiction, may enter upon the inquiry whether in the one instance an industrial dispute of the requisite kind exists, or on the other hand whether a trading corporation of the relevant kind is sought to be affected by the proceedings before it. It could not be said that such a court or tribunal lacked jurisdiction to enter upon such an inquiry. Clearly enough, in the present case the Federal Court could do so in the proceedings before it. But, if there were in truth no such dispute, or no such trading corporation, the court or tribunal could have no jurisdiction to make an award or order under a statute founded on the respective constitutional power. If the court to which application is made, not being restrained, forms a view as to the existence of the fact or situation which is necessary to satisfy the constitutional basis of the proceedings, its view cannot be definitive of the existence of jurisdiction. This Court alone can decide that in truth the relevant dispute, or the relevant corporation, was present. Prohibition to restrain the making of any award or order would be appropriate if this Court decided that no such dispute, or no such corporation, was relevantly present. It would be appropriate because the court or tribunal was attempting to exercise, or had purported to exercise, a jurisdiction which the Parliament did not have constitutional power to confer upon it. If, for that reason, the court or tribunal could not make any such award or order, it can be restrained from entering upon or continuing proceedings in which the making of such an award or order is sought. The relevant question is not whether the court or tribunal has jurisdiction to inquire into the existence of the fact or situation: but whether it could make the award or order sought. (at p204)
39. I have no doubt that if this Court were convinced that neither of the prosecutors is a trading corporation within the constitutional power granted by s. 51 (xx.), it could grant prohibition to the Federal Court: and if it thought fit to do so, grant the writ at the inception of the proceedings to obtain an order under the Act against the prosecutors. But the question whether the Court should do so is a different matter. (at p204)
40. No lack of jurisdiction is apparent on the face of the proceedings initiated in the Federal Court, however much of the material lodged by the respondent with his application to the Federal Court is regarded as forming part of "the face of the proceedings". The grant of the writ in this case thus lies in the discretion of the Court. The discretion is of course a judicial discretion exercisable on known or stated principles. In exercising the discretion the Court, in my opinion, should bear in mind the nature and purpose of the writ. I have already referred to the judgment of Brett J. in Worthington v. Jeffries (1875) LR 10 CP 379, at p 382 . It is for the public interest that tribunals of limited jurisdiction be confined within that jurisdiction. A judgment given or an order made in a matter which is outside the limited jurisdiction of the tribunal giving or making it, from which the parties do not appeal, may become a precedent. The public interest is that such a decision or order should not be allowed to stand: Bodenham v. Ricketts [1836] EngR 212; (1836) 6 Nev & MKB 170 (111 ER 850) . It is for this reason that a stranger may obtain prohibition. Such considerations apply with equal, if not greater, force with respect to matters where jurisdiction depends on constitutional competence. (at p204)
41. I mentioned earlier that the existence of an appeal, whether or not to this Court, cannot be an answer to an application for prohibition. On the other hand, the lack of an appeal could not in itself be a ground for prohibition if jurisdiction were present. As I read the successive judgments of this Court dealing with prohibition to the Industrial Arbitration tribunals, the lack of an appeal to this Court has never been the basis of the grant of prohibition. In principle, it could not, in my opinion, have been a reason for the exercise of the prerogative writ. That process is so called because it is not available for the correction of error, and because the assumption of a jurisdiction which does not lawfully exist is an usurpation of the prerogative of the Crown. (at p205)
42. I could not regard the existence of a right of appeal, and even less the possibility of the grant of special leave to appeal as a matter to be taken into consideration in the exercise of the judicial discretion. The parties may not exercise any right or possibility of appeal, being content for reasons unconnected with questions of jurisdiction with the orders made in the proceedings. (at p205)
43. The Federal Court of Australia is "a superior court of record and a court of law and equity" - s. 5 (2) of the Federal Court of Australia Act 1976 ("the Federal Court Act") - but it is a court of limited jurisdiction. It has such original jurisdiction as is vested in it by the Parliament in respect of matters arising under laws made by the Parliament: s. 19 (1) of the Federal Court Act. It has an appellate jurisdiction for which s. 24 (1) of the Federal Court Act provides: but we are not presently concerned with the nature or extent of that appellate jurisdiction. (at p205)
44. Part IV of the Federal Court Act regulates appeals from the Federal Court to this Court. No appeal may be brought as of right to this Court from the judgment of a single judge of the Federal Court unless some other Act of the Parliament otherwise provides (s. 33 (2)). But an appeal to this Court may be brought as of right from a final judgment of a full court of the Federal Court given or pronounced either for at least the sum of $20,000 or in proceedings in which the matter in issue amounts to or is of the value of that sum or which involve directly or indirectly a claim, demand or question to or respecting any property or other civil right to or of the value of at least that sum. This Court, however, may grant special leave to appeal in any case, whether decided by a single judge or by a full court. (at p205)
45. Taking the view I do as to the irrelevance of the existence of a right of appeal to the question whether prohibition should be granted, I do not intend to consider whether either the prosecutors or the respondent would have a right of appeal if an order as sought in the proceedings before it were made or rejected by the Federal Court. It is enough to say that, if contrary to my own opinion the existence of a right of appeal were relevant to the exercise of the discretion to grant or refuse prohibition, I am far from convinced that an appeal as of right would be open to either party to the proceedings now before the Federal Court. (at p205)
46. I have already indicated that the question whether or not the writ should issue at some particular stage of proceedings in the Federal Court is, in my opinion, very different from the question whether the writ should be refused in point of discretion. It seems to me appropriate that something be said as to the circumstances in which it may be appropriate to defer ordering the issue of the writ. If the existence or non-existence of a fact constitutionally basic to the Federal Court's jurisdiction to make any relevant order is a matter of controversy before this Court and the material placed before this Court requires oral testimony or is of a nature, whether because of complexity or volume, which would make the determination of the question by a full court undesirable, this Court may well adjourn the further hearing of the application for prohibition until the proceedings in the Federal Court have progressed to a point where the probable existence or non-existence of the fact or situation has emerged: or it may be that this Court in a particular case would prefer to refer contested facts to a single Justice for determination or it may be that the application should be deferred until the conclusion of the proceedings in the Federal Court. By adjourning the application until some later stage of the proceedings before the Federal Court, this Court would keep control of the question of jurisdiction and not relegate it to the whim of the parties as it would do if it refused prohibition on the ground that a right of appeal existed. If the application for prohibition is deferred till the conclusion of the proceedings before the Federal Court and an appeal from an order made in those proceedings is brought to this Court, the application for prohibition may be heard contemporaneously with the appeal. (at p206)
47. Of course, in considering whether to postpone the application for prohibition, the cost of continuing the proceedings before the Federal Court may well be an important factor: this would be particularly so where the material before this Court really involved no contest in fact or was such that the existence of the fact constitutionally basic to jurisdiction could conveniently be found by a full court of this Court. (at p206)
48. In general, where lack of constitutionally based jurisdiction is not apparent on the face of the proceedings, unless the facts necessary to a decision as to jurisdiction of the Federal Court are agreed, or indisputable, a situation unlikely often to occur, this Court should defer the hearing of the application for prohibition. In general, the Court should be reluctant to grant prohibition at an early stage of the proceedings. The preferable course would be to allow those proceedings to proceed, keeping on foot the application to grant prohibition so that, if appropriate, it may be granted at a later stage. If the application is not made until the proceedings in the Federal Court have progressed or even with the conclusion of those proceedings, the applicant should not be regarded as having unduly delayed the making of the application. (at p207)
49. I would sum up my conclusions on the procedural point as follows:
1. This Court has jurisdiction to grant prohibition to a federal court
whether or not a right of appeal to this Court lies from
orders made by that
federal court.
2. The Parliament has no legislative power to create a jurisdiction to make
any order under a statutory provision which would exceed
the relevant
constitutional power. In relation to s. 51 (xx.) this means that the
Parliament cannot give a federal court jurisdiction
to make an order against a
corporation which does not satisfy the description in that paragraph requiring
the corporation to do or
abstain from doing any act prescribed or forbidden by
an Act depending on that paragraph for its constitutional validity.
3. Where it does not appear on the face of the proceedings that the federal
court for constitutional reasons does not or could
not have jurisdiction to
make the order sought in the proceedings before it, the writ is not as of
right: its grant is discretionary.
4. The existence of a right of appeal to this Court from the orders of the
federal court is not relevant to the exercise of the
discretion to grant
prohibition.
5. Unless the facts necessary for decision of the question whether in truth
the fact upon which constitutional competence depends
are admitted or
indisputably proved, the Court in general should defer the consideration of an
application for prohibition brought
at the inception of proceedings before the
federal court until some later stage in or until the conclusion of those
proceedings,
allowing the federal court to proceed meanwhile. (at p207)
50. I now turn to the question whether either of the prosecutors is a "trading corporation". Before discussing the material before the Court as to the activities of the prosecutors, I should deal with the nature of a trading corporation for constitutional purposes. (at p207)
51. In conformity with the principles of constitutional construction, the description "trading corporation" in s. 51 (xx.) must be given its full content, generously rather than restrictively construed. Whilst it is in a sense true to say that the constitutional power is not a power to legislate with respect to the trading activities of corporations, the constitutional description cannot, in my opinion, properly be limited to the making of laws with respect to corporations which were formed as trading corporations, that is to say, as corporations the sole or predominant purpose of whose incorporation was to trade, however widely that word might be defined. (at p208)
52. The constitutional power was clearly not intended to be ossified to the classification of companies which may have been current in other times for specified purposes. The full connotation of the description "trading corporation" cannot be displaced by the denotation it may have had at any past time. It is a power evidently intended to be available in circumstances current in future times. Like other descriptive expressions in the Constitution, e.g. telephonic communication, the description "trading corporation" must be allowed to embrace all that may fall within it according to its natural meaning and the circumstances of the time at which a decision as to validity or constitutional power has to be made. (at p208)
53. In modern times having regard to the diversification of corporate activity and the virtual elimination of ultra vires from the law relating to companies registered under Companies Acts, e.g. s. 20 of the Companies Act, 1961 (N.S.W.), the nature of a company may not be discernible from a perusal of its memorandum. The only sure guide to the nature of the company is a purview of its current activities, a judgment as to its nature being made after an overview of all those activities. (at p208)
54. I remain of the firm conviction that for constitutional purposes a corporation formed within the limits of Australia will satisfy the description "trading corporation" if trading is a substantial corporate activity. Its activities rather than the purpose of its incorporation will designate its relevant character. But so to say assumes that such trading activities are within its corporate powers, actual or imputed. It is the corporation which satisfies the description which is the subject matter of the power. Thus its corporate capacity or incapacity cannot be ignored. But once it is found that trading is a substantial and not a merely peripheral activity not forbidden by the organic rules of the corporation, the conclusion that the corporation is a trading corporation is open. (at p208)
55. The prosecutors' principal submission in this connexion was that only corporations, incorporated as trading corporations - whatever that might mean - could fall within the description of that paragraph. Trading must be the purpose of its incorporation, according to the submission. It would not be enough that the corporation did in fact trade either as its exclusive activity or as one of its substantial activities. Counsel sought to extract support for this proposition from views expressed by the majority in R. v. Trade Practices Tribunal; Ex parte St. George County Council [1974] HCA 7; ; (1974) 130 CLR 533 . In my opinion, however, those views do not support the proposition. It was there said by the majority, as I read their reasons, that a corporation formed in the sphere of local government and for its purposes could not relevantly be a trading corporation. The case was not decided, as I view it, on the footing that in general the current activities of a corporation can be ignored when deciding whether or no it is a trading corporation but rather that the particular origin and the statutory association of that county council with local government precluded the conclusion that it was a trading corporation, albeit that all the council did was to trade and, indeed, that trading in electricity and electrical goods was at least its principal if not the sole purpose of its incorporation. The majority seems also to have denied the trading quality of what the council was doing on the ground that the supply of electricity was a public service. I might be permitted to remark that until quite recent times in Australia electricity was supplied by non-government bodies which clearly were trading in electricity. But its quality as a public service in the view of the majority seems to have been derived from the fact that it was supplied by a statutory or "government" body. There were thus in the St. George County Council Case [1974] HCA 7; (1974) 130 CLR 533 special considerations upon which the majority founded their views. Consequently, I do not regard the decision of the case as supporting the general proposition put forward on behalf of the prosecution. (at p209)
56. In any case, I may say, I continue to find myself unable to accept those views. The Court as presently composed is free in this case to reconsider and, if need be, to depart from them. That is a course I would support. (at p209)
57. I now consider what the Club and the State League were in fact engaged in doing. Trade for constitutional purposes cannot be confined to dealing in goods or commodities. Its full parameters may be difficult of definition. But the commercial nature of an activity is an element in deciding whether the action is in trade or trading. (at p209)
58. In the present case, although the material has not been presented to the Court in the most satisfactory manner or form due in some part to a sense of urgency, the evidence upon which a conclusion may be drawn as to the actual existence of what I have styled the constitutional fact or situation is not really in contest. For my part, I see no difficulty in its consideration by a full bench, nor any need to seek a finding by a Justice of this Court. The application for prohibition is not premature. The Court, in my opinion, is able itself to decide at this stage that the prosecutors are trading corporations. (at p210)
59. The central activity of the Club and of the League is the promotion of Australian Rules Football. The major avenue chosen for such promotion is the organization and presentation of competition matches in which the players may be, and I gather mostly are, professionals employed and paid for their participation in those matches which are played on grounds usually under the control of the Club or League, either ad hoc or under some form of tenure. These activities are clearly within the objects or purposes of the prosecutors. (at p210)
60. It was objected by the prosecutors' counsel that the Club was merely conducting a sport and therefore could not be regarded as being in trade. Of course, football of any code may be a sport, as distinct from a trade, when played solely for its own sake as a pastime upon an amateur footing. But what the Club and the League conduct is far removed from any such concept of sport. The players are professionals employed for wages in the playing of the code. This Court decided in Buckley v. Tutty [1971] HCA 71; (1971) 125 CLR 353 that such a player was an employee of the club for which he played. It has been held that a clause similar to those in the rules of the prosecutors which restrain a player from playing elsewhere than with the club with which he is registered without a clearance are void as in restraint of trade: see Wilberforce J. in Eastham v. Newcastle United Football Club Ltd. (1964) Ch 413 ; Blackler v. New Zealand Rugby Football League (Incorporated) (1968) NZLR 547 ; also Buckley v. Tutty. But in those cases the restraint of trade was found in the limitation on the freedom of the players to take employment, not of course on the footing that the employers were in trade or trading. However, the code of football in the New Zealand case required the players to be amateurs: yet the restraint was void. (at p210)
61. Charges are made for admission to the grounds under the control of the Club to view the matches promoted by it: the proceeds of the admission charges are received by the State League but part thereof is distributed to the Club, as the Club expects and intends when conducting the matches. The moneys thus received by the Club, usually from the gate money, form a substantial part of its income. It is true that no part of the income of the Club or League is distributable amongst its members. But considerable profit is made by the Club or by the State League out of which considerable assets are built up. (at p210)
62. In my opinion, the presentation of a football match as a commercial venture for profit to the promoting body is an activity of trade. I agree with Lord Russell in thinking that the presentation of a play by a theatrical promoter for reward by admission fees is a matter of trade: see Brimelow v. Casson (1924) 1 Ch 302 . I can see little difference between the presentation of a theatrical spectacle and the presentation for reward of the spectacle of a football match played by professionals as a major source of their income and of the income of the promoter. (at p211)
63. Here, however, the commercial activity of the Club is not limited to the promotion of football matches. A diverse range of advertising rights, television rights and sundry other rights are sold in connexion with the presentation of the matches. The detail of these activities may be read in the reasons for judgment of other Justices. Further, large sums are at times demanded by the Club for the release of players by clearance to play with other clubs: in general, no part of these moneys is paid to the player concerned. (at p211)
64. These activities, essentially commercial in nature, emphasize the trading quality of the manner in which the Club and the League promote Australian Rules Football. No doubt young players in junior leagues are encouraged by things done and moneys expended by the Club but one may be permitted to suspect that the motivation for the assistance of junior clubs is the prospect of a supply of players of quality to form the teams of the future from which the Club will reap financial benefits, and in any case, if purely philanthropic, these activities are of a minor character in relation to the activities of the Club as a whole. None of these activities are forbidden by the rules of the Club or of the State League. Indeed, the purpose of the associations, and thus of their corporation, is to do the very things which the Club and the State League are engaged in doing. In my opinion, the Club and the League are each trading corporations within the meaning of s. 51 (xx.) of the Constitution. (at p211)
65. Consequently, the order nisi for prohibition should be discharged, the prosecutors to pay the respondent's costs. (at p211)
GIBBS J. The circumstances of this case are set out in other judgments of the Court and I need not repeat them. (at p211)
2. The provisions of s. 45 of the Trade Practices Act 1974 (Cth), as amended ("the Act"), which are sought to be invoked against the prosecutors, the Western Australian National Football League (Incorporated) and the West Perth Football Club (Incorporated), are expressed to regulate the conduct of corporations. The expression "corporation" is defined in s. 4 of the Act, and the words of that definition which it has been submitted apply to the prosecutors are the following: ". . . a body corporate that - . . . (b) is a trading corporation formed within the limits of Australia or is a financial corporation so formed . . ." (at p212)
3. However, by s. 6 of the Act its provisions are given an extended operation, which was explained in Reg. v. Australian Industrial Court; Ex parte C.L.M. Holdings Pty. Ltd. [1977] HCA 6; (1977) 136 CLR 235, at pp 244-245 . For present purposes it is sufficient to say that even if the prosecutors are not corporations within the meaning of the Act, s. 45 will apply to such of their conduct as takes place in the course of or in relation to trade or commerce among the States. The conduct complained of was the refusal of the prosecutors to grant a clearance to Mr. Adamson to enable him to play football with another club in South Australia. The facts that Mr. Adamson, if granted a clearance, might choose to move from Western Australia to South Australia, or that if he joined the club in South Australia he might play matches against teams from other States, or that the prosecutors might arrange or promote matches between teams drawn from different States, do not mean that the refusal to grant a clearance was conduct in the course of or in relation to interstate trade. The authorities cited by my brother Mason in his judgment clearly dispose of that contention. (at p212)
4. It follows that if the prosecutors are to be subject to the provisions of s. 45 of the Act, that can only be because each is a "trading corporation" within the definition contained in s. 4 of the Act. It is obvious that the Act is intended to be an exercise of the powers conferred by s. 51 (xx.) of the Constitution, inter alia, and that the words of the definition which I have quoted are intended to have the same meaning as those of s. 51 (xx.) of the Constitution. We must therefore turn to consider the meaning of the latter provision. I do not dissent from the proposition that the words of the Constitution should not be restrictively construed, and it can hardly be doubted that the application of particular terms is not restricted to those things known in 1901. However, the words themselves cannot be ignored; it is their meaning that has to be determined. I have already expressed my views as to the meaning of the words "trading corporations" where they appear in s. 51 (xx.) in Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [1974] HCA 7; (1974) 130 CLR 533, at pp 561-562 and I adhere to what I there said. The present case is of course quite distinguishable on its facts from the St. George County Council Case [1974] HCA 7; (1974) 130 CLR 533, at pp 561-562 . However, in that case at least four of the members of the Court held that the words "trading corporation" do not simply mean any corporation which trades (1974) 130 CLR, at pp 546, 553, 561, 572 , and the decision to that effect should in my opinion be followed. The words of par. (xx.) when read together leave no doubt in my mind that the word "trading", like the words "foreign" and "financial", is used in that paragraph as an epithet describing a particular kind of corporation, and is not simply referring to what a corporation does, or to what its main activities happen to be. Of course, what a corporation does may throw light on what it is, and I do not intend to suggest that the memorandum of association, or other constitutional document, of a corporation, is the sole source of information as to whether it was formed for the purpose of trading. If, contrary to my opinion, the activities of a corporation at the relevant time determine whether it satisfies the constitutional test, it is the "predominant and characteristic activity" that has to be considered: St. George County Council Case (1974) 130 CLR, at p 543 . In my opinion, on any view of the construction of s. 51 (xx.), the prosecutors are not trading corporations within that provision, and they therefore are not corporations within s. 45 of the Act. I agree with what my brother Stephen has written in support of this conclusion, and could not usefully add to what he has said. (at p213)
5. The question that remains is whether in these circumstances prohibition
lies to the Federal Court. By s. 19 (1) of the Federal Court of Australia Act
1976 (Cth) the Federal Court is given such original jurisdiction as is vested
in it by laws made by the Parliament, being jurisdiction
in respect of matters
arising under laws made by the Parliament. By s. 32 (1) of that Act it is
provided:
"To the extent that the Constitution permits, jurisdiction is conferred
on the Court in respect of matters not otherwise within its jurisdiction that
are associated with
matters in which the jurisdiction of the Court is
invoked."
Jurisdiction in respect of matters arising under the Act is vested in the
Federal Court by s. 86 of the Trade Practices Act, and
the power which the
Federal Court is asked to exercise in the present case is that conferred by s.
80 of the Act - in particular
the power to grant an injunction restraining a
contravention of a provision of Pt IV of the Act, in which s. 45 appears. If
the prosecutors
are not trading corporations, none of these provisions empower
the Federal Court to grant any of the relief sought. That is not in
contest,
but it is said on behalf of the respondents that the Federal Court
nevertheless has jurisdiction to decide the question
whether the prosecutors
are trading corporations. In support of this argument we have been reminded
that from any decision of the
Federal Court an appeal may be brought to this
Court, at least by special leave (s. 33 of the Federal Court of Australia Act
1976)
and that the Parliament has confided to the Federal Court wide powers to
make a declaration as to the operation or effect of the
provisions of the Act:
s. 163A of the Trade Practices Act. (at p214)
6. Prohibition lies where a court is proceeding without jurisdiction, but not
to correct an erroneous decision made by a court in
the exercise of a
jurisdiction which it possesses. A legislature, in conferring jurisdiction
upon a court, may make the existence
of a state of facts a condition upon
which the jurisdiction of the court depends, and in that case the court cannot
give itself jurisdiction
by erroneously deciding that the facts exist. On the
other hand the legislature may entrust the court with power to determine
whether
such a state of facts exists, and if so the court has jurisdiction to
determine all the facts, including the preliminary facts on
the existence of
which the jurisdiction depends. This distinction was explained by Lord Esher
M.R. in Reg. v. Commissioners for Special
Purposes of the Income Tax (1888) 21
QBD 313, at pp 319-320 in a passage which has frequently been cited. In
Parisienne Basket Shoes
Pty. Ltd. v. Whyte [1938] HCA 7; (1938) 59 CLR 369, at p 391 Dixon
J. said that the former of those possible courses "produces so
inconvenient
a
result that no enactment
dealing with proceedings in any of the ordinary
courts of justice should receive such an
interpretation
unless the intention
is clearly
expressed". However, where the court is one created by the
Parliament acting under
the limited powers
given by the Constitution the
existence of a state of things necessary to bring the case within the scope of
those powers must be a condition of the jurisdiction
of the court. As Dixon J.
said in R. v. Hickman; Ex parte Fox and Clinton [1945] HCA 53; (1945) 70 CLR 598, at p 616 :
"It is, of course, quite impossible for the Parliament to give power to
any judicial or other authority which goes beyond the
subject matter of the
legislative power conferred by the Constitution."
It must inevitably follow that - ". . . power to determine conclusively a
question upon which jurisdiction is made to depend cannot
validly be conferred
upon a person or body in such manner as to enable a jurisdiction to be
exercised which would exceed the limits
of constitutional power." R. v.
Blakeley; Ex parte Association of Architects, etc. of Australia [1950] HCA 40; (1950) 82 CLR
54,
at p 89 per Fullagar
J. (at p215)
7. Further, it is settled by cases too numerous to mention that the Parliament has no power to exclude the original jurisdiction conferred on this Court by s. 75 (v.) of the Constitution in matters in which prohibition is sought against "an officer of the Commonwealth", and that the lastmentioned expression extends to judicial officers. (at p215)
8. The fact that a person whose conduct is said to be regulated by s. 45 of the Act is a trading corporation within s. 51 (xx.) of the Constitution is a condition of the jurisdiction of the Federal Court in a case such as the present. If that were not so, the investiture of jurisdiction on that Court would be pro tanto invalid. In the present case the question whether the prosecutors are trading corporations is therefore a jurisdictional, preliminary or collateral fact which this Court must decide for itself on an application for prohibition. (at p215)
9. Of course it does not follow that the Federal Court would have had no
power to decide whether the prosecutors were trading corporations.
If the
proceedings in the Federal Court had not been interrupted by the present
application for prohibition, that Court would have
been obliged to decide that
question for the purpose of determining whether it had jurisdiction. When the
question is raised before
a court of limited jurisdiction whether a condition
of its jurisdiction has been satisfied, that court is not obliged immediately
to refrain from proceeding further. It can and should decide whether the
condition is satisfied and whether it has jurisdiction to
proceed, but its
decision is not conclusive. This was clearly explained by Devlin J. in R. v.
Fulham, Hammersmith and Kensington
Rent Tribunal; Ex parte Zerek (1951) 2 KB
1, at p 10 where his Lordship said:
"When, at the inception of an inquiry by a tribunal of limited
jurisdiction, a challenge is made to their jurisdiction, the
tribunal have to
make up their minds whether they will act or not, and for that purpose to
arrive at some decision on whether they
have jurisdiction or not. If their
jurisdiction depends upon the existence of a state of facts, they must inform
themselves about
them, and if the facts are in dispute reach some conclusion
on the merits of the dispute. If they reach a wrong conclusion, the rights
of
the parties against each other are not affected. For, if the tribunal wrongly
assume jurisdiction, the party who apparently obtains
an order from it in
reality takes nothing. The whole proceeding is, in the phrase used in the old
reports, coram non judice."
Similarly in R. v. Blakeley; Ex parte Association of Architects, etc. of
Australia, Kitto J. said (1950) 82 CLR, at p 98 :
"The tribunal may, and should, inquire whether the state of things
exists upon which its power depends, but only for the purpose
of deciding
whether it will act on the basis that its power is exercisable or on the basis
that it is not. The superior court, however,
inquires whether the fact exists,
for the purpose of giving a binding decision on the question . . ."
The observations of Latham C.J. (1950) 82 CLR, at pp 69-70 and of Fullagar J.
(1950) 82 CLR, at pp 90-91 are to the same effect.
(at p216)
10. The existence of a right of appeal does not bar the power of a superior court to grant prohibition: see the cases cited in de Smith: Judicial Review of Administrative Action, 3rd ed. (1973) p. 375 and Halsbury's Laws of England, 4th ed. vol. 1, par. 130, n. 12. An additional reason for holding that the existence of a statutory provision providing a right of appeal does not deprive this Court of the power to grant prohibition in a case such as the present is that any legislative provision which had the effect of derogating from the remedy provided by s. 75 (v.) of the Constitution would be invalid. For reasons similar to those I have already expressed, the provisions of s. 163A of the Act do not support the view either that the Federal Court has exclusive jurisdiction to decide the present question or that prohibition does not lie. (at p216)
11. However, prohibition is discretionary (at least where lack of jurisdiction is not patent) and in some cases it would be convenient to defer the hearing of an application for prohibition until further proceedings had been taken in the tribunal against which prohibition was sought. This might be because a decision in favour of one party would render academic the question whether prohibition should be granted, or because it would assist this Court in discharging its ultimate responsibility if evidence were taken in the tribunal below. Those examples are not intended to be exclusive. However, in the present case such evidence as the parties thought necessary to adduce was presented to this Court, and if, on that evidence, we conclude that the prosecutors were not trading corporations within s. 51 (xx.), there can in my opinion be no reason to decline to grant prohibition. (at p216)
12. For these reasons I would make absolute the order nisi. (at p216)
STEPHEN J. On the question of whether or not the prosecutors and the South Australian National Football League (Incorporated) are "trading corporations" for the purposes of the Trade Practices Act I have the misfortune of disagreeing with other members of the Court. I will state quite shortly my reasons for doing so. (at p217)
2. There is, I think, no doubt but that the three bodies here in question are corporations: it is their character as "trading" corporations that I do not accept. (at p217)
3. The basic unit in organized football is the club. A group of clubs make up a league or association within which which they conform to a common code of rules and compete amongst themselves. The prosecutor, West Perth Football Club (Incorporated), is such a basic unit and is a member of a highly developed State-wide league, the Western Australian Football League (Incorporated), the second prosecutor. The League is in turn a member of a national body, the National Football League, of which the League's counterpart in South Australia, the South Australian National Football League (Incorporated), is also a member. (at p217)
4. The activities of the West Perth Club exhibit many features of what some deplore as the commercialization of sport, features which have been described in other judgments. It is no doubt the fate of sporting clubs whose teams engage in competition with other clubs that, as their competitive encounters attract increasing public interest, so too will their need for revenue increase if they are to continue successfully to engage in competition with rival clubs, seeking and retaining skilled players and providing facilities for increasing numbers of members and accommodation for other spectators at matches. (at p217)
5. As a club's popularity grows and with it its need for funds, so too does its ability to obtain those funds. Instead of having to rely largely on membership fees, its gate receipts increase and other profitable avenues open up. This conjunction of growing need and ability, accompanied by the exploitation of that ability, may cause sporting clubs to stray far from their origin as groups of amateur sportsmen but will not, in my view, of itself change their original character into that of trading entities. (at p217)
6. The objects of the West Perth Football Club as expressed in its rules are in themselves entirely consistent with what would be expected of a sporting club and it is not suggested that from these objects alone a character of "trading corporation" may be discerned. However it is said that because the Club carries on "trading" activities and does so on a large scale it has become a trading corporation. Its principal activity consists of all that is involved in fielding club teams in the series of matches which go to make up the annual competitions organized by the League. It is directly from this activity that it derives almost half its income since it receives a large share of the gate takings and other receipts which the League derives from matches played by the Club's teams. Its membership fees provide another third of its income, the balance coming from profit on bar trading, catering and the like and from the sale at a profit of club badges, ties and souvenirs. (at p218)
7. These income-producing activities are no doubt in the nature of trade and in one sense it can be of little significance that the spectacles which the Club promotes involve teams of footballers. The staging of sporting spectacles may quite well provide that activity from which a trading corporation derives its income. However the fact that it is Australia's most popular spectator sport, football, which is in question is, in another sense, of great importance. It explains why it is that the Club has thousands of fee-paying members who yet derive no profits from the Club, why its unpaid committee members devote their time as its officers, why the whole complex of ardently supported clubs, of State leagues and of national associations exist and thrive, those responsible for their promotion being content to find their reward in the satisfaction of their enthusiasm for football. It is this enthusiasm that accounts for the phenomenon of corporations which are not trading corporations yet through whose tills large revenues pass. (at p218)
8. To analyze the matter more closely, three significant facts may be singled out. The first is that no part of the income of the Club may be distributed to its members, instead it is used (in declining) order of magnitude, taken from the Club's 1977 accounts) to pay players, to pay salaries of staff, to defray "members' admissions", and to pay coaching fees, rent of premises, stationery and the like. The second is that the Club is an association having a very large membership, over 2,000 men and over 600 women, who join it with no expectation of sharing in its profits and from whom are elected the Club's unsalaried management committee. The third, and the most important, is that the Club, together with the other clubs of the League, does in fact devote itself to its primary object as stated in its rules, that is "to foster the Australian National Game of Football and to provide facilities for the playing of the same". Nothing in the evidence suggests any departure from this stated primary objective, which this Club seems to pursue with great vigour. (at p218)
9. As all judgments in Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [1974] HCA 7; (1974) 130 CLR 533 insist, the term "trading corporation" is no term of art. Whatever may be the precise limits of what, in common usage, it describes, those limits do not, I think, include a football club such as this Club. Just as Menzies J. thought that it would hardly be material to call the Snowy Mountains Authority a trading corporation [1974] HCA 7; (1974) 130 CLR 533 , so it would not, I believe, occur to many Australians to describe this Club as a trading corporation, and this for the good reason that both its predominant object and its sole activity is remote from trade and from profit-making. It does what it does to promote football, the income that comes its way being no doubt eagerly gathered in, but only as a means of better promoting its predominant purpose, the fostering of football. (at p219)
10. Whichever of the several views that were expressed in the St. George County Council Case [1974] HCA 7; (1974) 130 CLR 533 , be applied the result must, I think, be the same. Adapting to the present facts the words of Menzies J. (1974) 130 CLR, at p 551 , it is the subordination of such trading as the Club undertakes to its prime purpose of the fostering of football that reveals the very nature of the Club to be other than that of a trading corporation. Its objects contemplate that it shall be a true members' sporting club and to those objects its activities conform. As Gibbs J. said (1974) 130 CLR, at p 562 , that a corporation carries on some trade which is merely incidental or ancillary to the fulfilment of its main purpose does not give it the character of a trading corporation: the essential attribute of a trading corporation is supplied by the word "trading", it is not enough that it engages in trade, it must have been "formed for the purpose of trading". Barwick C.J. denied (1974) 130 CLR, at p 543 , that "a corporation which to any extent engages in trade is a trading corporation"; its "predominant and characteristic activity" must be trading, whether in goods or services, before it is a trading corporation. In my judgment I regarded functions, both intended and actually undertaken, as of prime importance (1974) 130 CLR, at p 568 : the County Council's sole intended and implemented function was to trade in electricity, the Club's sole intended and implemented function is that of a sporting club fostering football. (at p219)
11. No significance attaches, I think, to the fact that players are paid and that large transfer fees may be demanded when players move from one club to another. All this may be regretted by those with a sentimental fondness for amateur sport but because this sport has in this sense become commercialized does not mean that football clubs have become trading corporations: the payment of players may affect their legal relationship to their club, it does not alter the character of the club itself, whether that be regarded as deriving from the objects of its incorporation or from the activities or functions which it undertakes. (at p220)
12. So much for the Club. Much of what I have said of it applies also to the Western Australian League. Its stated principal objects are to promote, control, manage and encourage the game of football, arranging matches and competitions. The evidence of what in fact are its activities shows them to be just that, no more and no less. Like the Club it takes advantage of the opportunities open to it to derive profits, but only those opportunities which arise incidentally in the carrying out of those very activities which it engages in in the furtherance of its principal objects. In doing this it of course trades: it charges for television, broadcasting and catering rights at the matches it organizes and for the sale of its programmes and advertising space in those programmes, it gets money for promotion, sponsorship and advertising, it collects, and retains for itself a proportion of, gate takings at matches. But, as all who participated in the St. George County Council Case [1974] HCA 7; (1974) 130 CLR 533 agreed, to engage in trade is not in itself to be a trading corporation. Very large sums pass through the League's hands, no doubt because football matches and competitions are very popular in Western Australia. Its members are the various clubs of the League and profits remaining after distributions to the clubs and after defraying the expenses of carrying out the purposes of the League are to be equally divided between the clubs. (at p220)
13. The purpose for which the League was formed was not that of engaging in trade, nor have its activities deviated from the effecting of the purposes of its formation; its intended functions have proved to be its actual functions and these do not consist of the engaging in trade. Such trading as it undertakes is incidental to and a by-product of its principal activities and is undertaken the better to perform those activities. Accordingly I do not regard it as a trading corporation. (at p220)
14. The same considerations largely apply both to the South Australian National Football League (Incorporated) and to the National Football League of Australia Ltd. and their cases call for no separate consideration. (at p220)
15. I have laid considerable stress upon the incidental character of the trading activities of these corporations and have done so because I think that there may well be a distinction between trading which is incidental to, and is undertaken in the course of carrying out, some other principal non-trading activity and trading which is engaged in as a distinct and unconnected activity. Were the Club or the League, assuming power to do so and so as to meet a need for additional funds, to become a retail trader, say in groceries, very different questions might then arise and it might be no answer that the purpose of entering into that trade was to apply the resultant profits to the fostering of football. (at p221)
16. Having concluded that the three corporations here in question are not trading corporations, it follows that to the extent to which the respondent Adamson seeks to rely upon s. 45 (2) of the Trade Practices Act 1974, as amended, that reliance must be unsuccessful for want of any such a corporation as that to which the section, read in conjunction with s. 4 (1), refers. I regard as untenable the alternative submission, that s. 6 may here be relied upon because of relevant elements of interstate trade. I adopt, in this regard, what is said in the judgment of my brother Mason. (at p221)
17. It follows that in my view the proceedings instituted in the Federal Court are shown to be wanting in respect of jurisdiction. I have had the advantage of reading the reasons for judgment of the Chief Justice and agree with his Honour's conclusions relating to the grant of prohibition to the Federal Court as stated in pars. 1 to 4 of his summary of conclusions. Having reached a firm conclusion as to jurisdiction in this matter and in light of the state and nature of the evidence upon which I have been able to reach that conclusion I would, for my part, make absolute the present order nisi for prohibition. (at p221)
MASON J. This is an application by the prosecutors, the Western Australian National Football League (Incorporated) ("the W.A. League") and the West Perth Football Club (Incorporated) ("West Perth"), to make absolute an order nisi granted by the Chief Justice for prohibition directed to the Judges of the Federal Court of Australia and one Brian Ronald Adamson. The prohibition sought is designed to prevent the Federal Court from hearing proceedings commenced by Adamson against the prosecutors and the South Australian National Football League (Incorporated) ("the S.A. League") for relief under the Trade Practices Act 1974, as amended ("the Act"). (at p221)
2. The grounds upon which prohibition is sought are that the prosecutors and the S.A. League (a) are not corporations, that they do not fall within the definition of "corporation" contained in s. 4 of the Act and that they are therefore not subject to the jurisdiction of the Federal Court in respect of an alleged contravention of s. 45 (2) of the Act; and (b) are not persons relevantly engaged in interstate trade and commerce, that being the only form of trade and commerce which, in the circumstances, it is suggested would bring them within the purview of s. 6 (2) of the Act in respect of an alleged contravention of s. 45 (2). (at p222)
3. According to the evidence filed in the Federal Court, Adamson, who is twenty-five years of age and is now a resident in the State of South Australia, desires to play Australian Rules football with the Norwood Football Club (Incorporated) ("Norwood") in the S.A. League competition. He is evidently a player of ability as he represented Western Australia in 1977. In January 1978 Adamson entered into a contract with Norwood to play football for that club in the 1978, 1979 and 1980 seasons. Having entered into that contract he advised his former club, West Perth, and made arrangements to move to South Australia. He resigned his employment in Perth and secured a transfer for his wife to a teachers' college in South Australia. As he was not under contract to West Perth, that club endeavoured to negotiate a contract with him on learning that he proposed to play for Norwood. The negotiations were unsuccessful, although Adamson did play two games for West Perth at the beginning of the 1978 season. He has applied for, and has been refused, a clearance to play for Norwood by the committee of management of West Perth. He has also applied for, and has been refused, a clearance from Western Australia to play for a club in South Australia by the W.A. League. (at p222)
4. For the purposes of the proceedings in this Court it is unnecessary to review in detail the clearance and permit regulations of the National Football League ("the National League"), a body of which the W.A. League and the S.A. League are constituent members. The regulations of the National League bind the W.A. League and the S.A. League and their affiliated clubs, including West Perth and Norwood. The effect of the relevant rules of the W.A. League by which West Perth is bound is that, speaking generally, once a player becomes territorially bound to a club by residence for thirty days in that club's geographical district or zone - and Adamson was so bound to West Perth - he is ineligible for a permit to play for another club that is a member of that League unless and until he shall have resided outside the first club's district for two years, in which event he becomes territorially bound to the club in whose district he is residing and has resided for thirty days. He is then eligible for a permit to play with that club only. No player is eligible to play with a club that is a member of the W.A. League in a competition unless he has been granted a permit by the permit committee of that League. (at p223)
5. By the clearance and permit regulations of the National League a player of a League club in one State must receive a clearance from the League of that State before he is eligible to apply for a permit to play with a League Club in another State. Without such a clearance he cannot play for a club in the second State unless and until he has bona fide resided for two complete football playing seasons in that State without playing competition football meantime. In this case Adamson made application to the W.A. League for a clearance to play in South Australia in a form prescribed by the National League regulations. It contained a provision for West Perth to indicate whether it approved or disapproved the grant of the clearance. West Perth indicated its disapproval. There is provision in the National League regulations for an appeal against refusal of a clearance, but this procedure has not been invoked. The suggestion made by Adamson's counsel is that a club will not grant a clearance or consent to the grant of a clearance in respect of a valuable player, even if he is not under contract to the club, unless it receives a money payment or some other consideration from the club which he wishes to join and that the W.A. League will support those of its clubs which adopt that approach. (at p223)
6. According to the regulations of the National League, Norwood is not entitled to play Adamson until he obtains a clearance. Under the rules of the S.A. League, Norwood will lose, or run the risk of losing, competition points if it plays Adamson in a S.A. League competition match. Obviously it has no intention of playing Adamson in such a match unless and until it can play him free of that risk. (at p223)
7. In these circumstances it is Adamson's case in the Federal Court that the prosecutors and the S.A. League have acted in breach of the provisions of s. 45 (2) of the Act in refusing to grant him a clearance to Norwood. He seeks from the Federal Court injunctions the effect of which, if granted, will be to enable him to play for Norwood without a clearance from West Perth or the W.A. League. (at p223)
8. The case presented by Adamson in the Federal Court rests on the foundation that the prosecutors and the S.A. League or one or more of them is or are trading corporations within the meaning of the Act and that they have entered into a contract, arrangement or understanding which falls within s. 45 (2) or, alternatively, that they are persons engaged in trade and commerce among the States in the course of which they have entered into a contract, arrangement or understanding which falls within s. 45 (2). These contentions are disputed by the prosecutors who assert that if their submissions to the contrary be accepted, then the Federal Court is without jurisdiction to determine Adamson's proceedings. Extensive evidence has been placed before this Court as to the business, trade and other activities of the prosecutors and the S.A. League, to which I shall refer in more detail at a later stage. At this stage I need say no more than that this evidence goes a long way towards establishing that the prosecutors and the S.A. League are trading corporations. It certainly does not establish that they are engaged in interstate trade or commerce for reasons which will appear subsequently. (at p224)
9. The first issue is whether prohibition lies in these circumstances. In Reg. v. Federal Court of Australia; Ex parte Pilkington A.C.I. (Operations) Pty. Ltd. [1978] HCA 60; (1978) 142 CLR 113 I expressed my reasons for the conclusion that prohibition will not lie to restrain the Federal Court from entertaining a case which it has jurisdiction to hear and determine under the Act. As I understand the prosecutors' argument, they do not dispute that the Federal Court has jurisdiction to determine whether the prosecutors and the S.A. League or any one or more of them is or are corporations or trading corporations for the purposes of the Act. Nor do they dispute that the Federal Court has jurisdiction to determine whether they are relevantly engaged in interstate trade and commerce. However, the prosecutors contend that these issues, more particularly the first, call for a determination of constitutional facts. It is said that in the first instance the Federal Court will be required to interpret the expression "trading corporation" in s. 51 (xx.) of the Constitution, the statutory definition in s. 4 of the Act being no more than a reflection of the constitutional expression. Secondly, it is said that the Federal Court will be required to make a finding of facts in relation to the character and activities of each of the entities who are parties to the proceedings in that Court with a view to deciding whether any one or more of them falls within the ambit of the constitutional expression as it is interpreted by the Court. It is urged that the conclusion thereby reached involves a finding as to constitutional facts which is not binding on this Court. The conclusion sought to be reached is that the case is therefore one appropriate for prohibition. (at p224)
10. In view of the prosecutors' concession, no time need be expended in labouring the point that, by virtue of s. 86, which confers jurisdiction on the Federal Court to hear and determine proceedings for injunctions in respect of contraventions of Pt IV and Pt V, it is for that Court to decide in the exercise of its jurisdiction whether a trading corporation which is alleged to contravene the proceedings of s. 45 (2) is such a corporation, subject to the argument directed to constitutional facts. It scarcely needs to be said that there is no embargo against the Federal Court hearing and deciding constitutional questions in the course of exercising its jurisdiction. There is no constitutional principle which presents Australian courts other than the High Court from deciding such questions when they arise in the exercise of jurisdiction. The old provision in s. 40A of the Judiciary Act 1903-1973 which was designed to secure an automatic removal of inter se questions from State courts to this Court was repealed by the Judiciary Amendment Act 1976. Under the new dispensation State and federal courts are at liberty to decide constitutional questions, including inter se questions subject only to the making by this Court of an order for removal on application made by an Attorney-General or a party under the new s. 40 of the Judiciary Act. No such order has been made in this case; nor has any application for such an order been made. (at p225)
11. It is no doubt correct to say that this Court is not bound by any determination which the Federal Court may make as to the status of any of the parties as a trading corporation. It is for this Court to determine for itself, when its jurisdiction has been invoked, whether an entity answers the constitutional description "trading corporation". Thus, in an appeal brought as of right or by special leave under s. 33 of the Federal Court of Australia Act 1976 from a decision of the Full Court of the Federal Court, this Court could decide whether any of the bodies was such a corporation and in so doing it would not be bound by the Federal Court's view on that question. However, this is not to say that the Federal Court is deprived of jurisdiction to entertain the proceedings now before it. It merely asserts that the Federal Court's decision is subject to appeal. (at p225)
12. Sometimes it has been said that a tribunal has jurisdiction to determine a fact conclusively, when all that is meant is that the existence of the fact is not a condition of the exercise of jurisdiction and the tribunal's decision is free from collateral attack and is not subject to prohibition, though the decision is subject to appeal and is not final and conclusive in that sense. Indeed, the existence of a right of appeal, particularly to a superior court, makes it the more likely the existence of the fact will be held not to be a condition of the exercise of jurisdiction. In the context of which I am speaking the word "conclusive" or "conclusively" is used to distinguish the jurisdiction from that of a tribunal whose decision on the issue of collateral fact is subject to prohibition. In this, the latter case, the tribunal has jurisdiction or power to make the preliminary inquiry and reach a conclusion, but its conclusion is subject to challenge by prohibition and for this reason it is not "conclusive". Here, as I have said, there is an appeal from the Federal Court, ultimately to this Court, and the question of jurisdiction must be determined on this footing. (at p226)
13. Implicit in the argument advanced by the prosecutors is the contention that prohibition will issue either as a matter of course or as a matter of discretion whenever the court below is called upon in the exercise of its jurisdiction to decide constitutional facts. According to the argument, constitutional facts are to be treated as the equivalent of jurisdictional or collateral facts for the purposes of prohibition. In essence the argument is that the court below is authorized to decide a constitutional question but only to the extent that it decides the question correctly. Otherwise, it is urged, the court could, by an erroneous decision, give the Act an application to bodies that lie outside the reach of constitutional power. (at p226)
14. The arbitration cases upon which the prosecutors heavily rely, when correctly understood, expose the fallacy that underlies the argument. As the prosecutors point out, it has long been accepted that the Conciliation and Arbitration Commission cannot conclusively determine the existence of an industrial dispute extending beyond the limits of one State. The actual existence of such a dispute is a condition of the exercise by the Commission of its jurisdiction to deal with the dispute. And so it was with the Commission's predecessor, the Arbitration Court, which, despite its name, was recognized even before Attorney-General (Cth) v. The Queen [1957] HCA 12; (1957) 95 CLR 529 not to be exercising judicial power when it determined an industrial dispute (R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Ozone Theatres (Aust.) Ltd. [1949] HCA 33; (1949) 78 CLR 389, at p 399 ). (at p226)
15. The conclusion that the Conciliation and Arbitration Act made the
existence of an industrial dispute a condition of the exercise
of the court's
jurisdiction to hear and determine the dispute was arrived at by a process of
statutory interpretation which has reflected
constitutional considerations. In
R. v. Blakeley; Ex parte Association of Architects etc. of Australia [1950] HCA 40; (1950) 82
CLR 54 , Fullagar
J. recognized the relevance of these considerations when he
said (1950) 82 CLR, at pp 88-89 :
"The power given to this Court to issue mandamus or prohibition is
derived from the Constitution, and, as has often been said, cannot be taken
away by the Parliament. But a jurisdiction, the exercise of which may be
compelled
by mandamus or the excess of which may be restrained by prohibition,
may, within the limits set by the Constitution, be defined by the Parliament
in whatever way it thinks fit. In particular, within those limits, the
Parliament may, in conferring
jurisdiction upon a person or body, enact that
that person or body shall have power to determine conclusively a question upon
which
the jurisdiction is made to depend, and the effect of so enacting may be
that neither mandamus nor prohibition will lie to that person
or body. If that
effect follows, it is not because any power is taken away from this Court but
because no situation justifying the
issue of mandamus or prohibition ever
comes into existence. But power to determine conclusively a question upon
which jurisdiction
is made to depend cannot validly be conferred upon a person
or body in such manner as to enable a jurisdiction to be exercised which
would
exceed the limits of constitutional power."
His Honour went on to say (1950) 82 CLR, at p 89 :
"And the terms of s. 51 (xxxv.) of the Constitution are such that it
'(the power to make an award)' cannot validly be conferred except by reference
to an industrial dispute. If Parliament
purports to make the decision of the
Court or a Commissioner conclusive as to the existence or non-existence of an
industrial dispute,
the Court or a Commissioner may determine in any
particular case that a dispute does not exist or that a dispute does exist. If
it
or he determines, though wrongly, that a dispute does not exist and
declines to make an award there is no transgression of the limits
of s. 51
(xxxv.). If, however, it or he determines wrongly that an industrial dispute
does exist and proceeds towards the making of an award,
there will or may be a
transgression of the limits of s. 51 (xxxv.)." (at p227)
16. Earlier, in R. v. Hickman; Ex parte Fox and Clinton [1945] HCA 53; (1945) 70 CLR 598, at
p 616 , Dixon J. said: "It is . .
. quite impossible
for the Parliament to
give power to any judicial or other
authority which goes beyond the subject
matter of the
legislative power
conferred by the Constitution." (at p227)
17. Fullagar J. was speaking of a situation in which Parliament confers on a court or a commissioner power to make a final and conclusive determination of the existence or non-existence of an industrial dispute. Historically the Parliament has sought to make the determinations of the Arbitration Court and the Commission final and conclusive. There was no appeal from the Arbitration Court to this Court and there is now no appeal to this Court from the Commission. Furthermore, the Conciliation and Arbitration Act has contained from its inception, and still contains, provisions stating that awards and determinations of the Arbitration Court (now of the Commission) are final and conclusive and not subject to appeal, prohibition or mandamus (see Conciliation and Arbitration Act 1904-1911, s. 31; Conciliation and Arbitration Act 1904-1947, ss. 20 and 36; Conciliation and Arbitration Act 1904-1950, ss. 16 and 32; and Conciliation and Arbitration Act 1904-1976, s. 60). (at p228)
18. The well-accepted proposition that this Court's constitutional jurisdiction to issue mandamus, prohibition and injunction to an officer of the Commonwealth cannot be removed by statute rests at bottom, not only on the provisions of s. 75 (v.) of the Constitution, but also on the principle that other courts and tribunals cannot be entrusted with jurisdiction and power to decide constitutional facts free from supervision by this Court. Parliament could not validly repose in the Commission as a statutory authority the final and conclusive power of determining the existence or non-existence of an interstate industrial dispute. To concede the existence of such a power in the Commission would be to enable it by an erroneous decision to settle controversies or issues which stand outside the subject matter of legislative power. Nor could Parliament repose in a court other than the High Court final and conclusive power to determine the existence or non-existence of an interstate industrial dispute, unless the determination is subject to an appeal to this Court or to review by this Court by means of a prerogative writ, injunction or declaration, and for a like reason. Under the Constitution it is this Court which is charged with the ultimate responsibility of interpreting and applying the Constitution. It is not a responsibility which can be circumvented by depriving this Court of the opportunity of reviewing on appeal or by the means already mentioned the decisions of other courts and tribunals on constitutional facts. (at p228)
19. The arbitration cases accordingly provide no comfort for the prosecutors. They turn very much on the circumstance that no appeal lies to this Court from a finding of the Commission on constitutional facts. They supply no reason for treating the exercise of jurisdiction of the Federal Court as conditional upon the actual status of a party or person as a trading corporation or upon the actual existence of other circumstances which would give the Act a valid operation in the particular case. (at p228)
20. The decision of this Court in Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [1974] HCA 7; (1974) 130 CLR 533 does not support the prosecutors. There prohibition issued to the Trade Practices Tribunal in relation to proceedings brought by the Commissioner for Trade Practices against the County Council under the Restrictive Trade Practices Act 1971-1972 on the footing that it was a trading corporation within the meaning of the definition contained in s. 5 of that Act. The Court, by majority, held that the County Council was not such a corporation and on this ground the order nisi for prohibition was made absolute. No question as to the availability or propriety for granting prohibition was argued, it being evidently assumed that the Tribunal had no jurisdiction to entertain the proceedings if the County Council was not a trading corporation. That this assumption should have been made is understandable because it appears that no appeal lay from a determination of the Tribunal to this Court either directly or indirectly through the Commonwealth Industrial Court. Consequently, there was strong reason for thinking that Parliament did not intend to give the Trade Practices Tribunal conclusive power to determine constitutional facts. To conclude otherwise would raise the spectre of constitutional invalidity for the legislation might then be given an application beyond the limits of constitutional power. (at p229)
21. Even so, I should have thought that there was a real question whether
this Court should have granted prohibition before the
Tribunal had an
opportunity to consider the question and reach a conclusion upon it. I
acknowledge that in R. v. Galvin; Ex parte
Metal Trades Employers' Association
[1949] HCA 12; (1949) 77 CLR 432, at p 445 the Court said:
"A person against whom a non-existent jurisdiction is invoked is not
bound to wait until the tribunal decides for itself whether
it has
jurisdiction or obtains a decision of the question by a reference or case
stated or the like. He may move at once for a prohibition."
This comment was directed to the situation of the prosecutor. It does not in
my opinion adequately or correctly reflect the approach
to be taken by this
Court when application is made for a prohibition before the lower court or
tribunal has had an opportunity to
consider the jurisdictional question. The
approach to be adopted in such a case was in my view correctly enunciated by
Dixon C.J.,
Williams, Webb and Fullagar JJ. in Reg. v. Australian Stevedoring
Industry Board; Ex parte Melbourne Stevedoring Co. Pty. Ltd. [1953]
HCA 22; [1953] HCA 22; (1953)
88 CLR 100
. There the Court considered the application of s. 23 of the Stevedoring
Industry Act 1949 which provided
that,
where
after such inquiry as it thinks
fit, the Board is satisfied that an employer is unfit to continue to be
registered or
has acted
in
a manner prejudicial to the proper performance of
stevedoring operations, it may cancel or suspend his registration.
Their
Honours
said (1953) 88 CLR, at pp 117-118 :
". . . it must always be open to the board or its delegate to
investigate the question whether a case exists for the exercise
of its powers.
There can be nothing wrong or unlawful in the board or its delegate entering
upon an inquiry into any of the matters
described by the three paragraphs of
s. 23 (1). It is therefore evident that no prohibition could go to restrain
the holding of an
inquiry directed to any one or more of those issues. There
can be no foundation for a writ of prohibition unless and until it appears,
whether from the course of the inquiry or from the preliminary statement of
the matters to which the inquiry is directed, that there
can be no basis for
the exercise of the power conferred by s. 23 (1) or that an erroneous test of
the liability of the employer to
the cancellation or suspension of his
registration will be applied or that some abuse of authority is likely. In any
such case a
writ of prohibition may lie but it must be a writ restraining the
ordering of cancellation or suspension."
Their Honours went on to say (1953) 88 CLR, at p 119 :
"At common law a prosecutor is expected to apply at the earliest stage
at which his right to a writ arises, but he is not entitled
to the remedy quia
timet, that is before the tribunal is invoked or assumes a jurisdiction or
authority over the matter and, where
the complaint is that an order may be
made in excess of power or notwithstanding that the power has not attached,
the prosecutor
must show a real likelihood or danger of such an order being
made." (at p230)
22. I conclude, therefore, that the Federal Court has jurisdiction to decide
whether the prosecutors or any of them are trading
corporations and, further,
that as its decision is subject to an appeal to this Court under s. 33 from
the Federal Court of Australia
Act, it has not been armed with a conclusive
power to determine constitutional facts the exercise of which is unreviewable
by this
Court.
There is, accordingly, no absence or excess of jurisdiction in
the Federal Court which would justify the grant of prohibition.
(at
p230)
23. Even if the existence of the appeal to this Court under s. 33 had not afforded in itself an absolute answer to the case of prohibition, I should have thought that the existence of the appeal constitutes a persuasive ground for refusing the writ as a matter of discretion. Many times it has been said that prohibition, though a writ of right, is not a writ of course. In general there is a great deal to be said for the view that this Court should have the benefit of the Federal Court's findings of fact and law before it embarks upon a consideration of questions of substance even though they involve constitutional questions. If it were thought that there were advantages in having the constitutional questions determined in the first instance by this Court, then application should have been made to bring these questions here by means of an order under s. 40 of the Judiciary Act, rather than by means of prohibition. (at p231)
24. Having come to a firm conclusion in relation to the grounds for prohibition argued by the prosecutors I shall deal with them. There is in my opinion no substance in the contention that the prosecutors and the S.A. League are not trading corporations. The prosecutors are both incorporated under the Associations Incorporation Act, 1895 (W.A.), as amended. The S.A. League is incorporated under the Associations Incorporation Act, 1965 (S.A.), as amended. Although there are differences between the two statutes, they are broadly similar. The Western Australian statute provides for the incorporation of an association by the filing with the Registrar of Companies of certain documents, including a copy of the constitution of the association (s. 3). The certificate of incorporation or a duly certified copy shall be received in evidence without further proof that the association is duly incorporated (s. 3 (b)). Upon a certificate of incorporation being granted, the association shall, as from the date of the certificate, be incorporated for certain purposes, including the use of its name and adding thereto the word "Incorporated" or "Inc.", the use of a common seal, suing and being sued, and for acquiring, holding and disposing of assets "and otherwise dealing with the same as fully and effectually as an individual owner could do", and for executing instruments (s. 6). After incorporation real and personal property, formerly vested in the trustees, are to vest in the corporation (s. 10). (at p231)
25. "Association" is defined by s. 2 so as to include -
"churches, chapels, and all religious bodies, schools, hospitals, and
all benevolent and charitable institutions, mechanics'
institutes, and all
associations for the purpose of promoting and encouraging literature, science,
and art, and all other institutions
and associations formed, or to be formed,
for promoting the like objects, and any other association, institution, or
body which the
Attorney General certifies as being one to which the facilities
given by this Act ought to be extended: Provided that this Act shall
not apply
to associations for the purpose of trading or securing pecuniary profit to the
members from the transactions thereof."
Each of the prosecutors was the subject of a certificate given by the
Attorney-General for the purposes of the definition. (at p231)
26. It is not necessary to refer in detail to the South Australian statute. It contains a broadly similar definition of "association" with a corresponding proviso (s. 4). The effect of registration is to make the association and the members thereof for the time being a body corporate (s. 12 (1)). The association has perpetual succession, shall have a common seal and shall be capable of exercising all the functions of an incorporated body (s. 12 (2)). It may sue and be sued (s. 12 (3)). There is provision for cancellation of registration in certain circumstances, more particularly when the transactions of the association are such that it is not or has ceased to be an association within the meaning of s. 4. (at p232)
27. The prosecutors concede that the effect of their incorporation under the Western Australian statute, and that of the S.A. League under the South Australian statute, is that they are all bodies corporate, but it is denied that they are trading corporations within the meaning of s. 51 (xx.) of the Constitution or s. 4 of the Act. It is common ground that if they are not trading corporations, they cannot be "corporations" within the meaning of the definition contained in s. 4 of the Act. The argument is based on the terms of the proviso to the definition of "association" in the two statutes and the limited purposes for which incorporation is granted. (at p232)
28. The existence of the proviso to the definition does not produce the consequence that an association, once incorporated, ceases to be a corporation because it subsequently engages in trading activities. The certificate of incorporation continues to attest its corporate status; the association can only lose this status by ceasing to be registered under the statute, an event for which the Western Australian statute, unlike its South Australian counterpart, makes no provision. Although the purposes for which incorporation is granted are limited in Western Australia (s. 6), the purposes so far as they are expressed in terms of performing acts and entering into transactions are sufficiently extensive to comprehend the activities of the prosecutors. (at p232)
29. However, according to the prosecutors the proviso and, to some extent, s. 6 become important in deciding whether an association is a trading corporation, for it is the prosecutors' submission that the Court is required to consider exclusively the purpose for which the association was incorporated, not its current activities, whatever they may be, in resolving that question. Despite its invocation by the prosecutors I do not think that the St. George County Council Case is authority for this proposition, though there are statements in the majority judgments which tend to support it (1974) 130 CLR, at pp 551-552, 562 . The case decided no more than that a county council created under the Local Government Act, 1919 (N.S.W.), as amended, for local government purposes was not a "trading corporation" for the purposes of s. 51 (xx.) and the statutory definition of that expression contained in the Restrictive Trade Practices Act. Of the majority, McTiernan J. said that a trading corporation was a trading company which was incorporated (1974) 130 CLR, at p 548 . Menzies and Gibbs JJ. denied that a "trading corporation" in s. 51 (xx.) is "a corporation which is trading" (1974) 130 CLR, at pp 551-552, 561 . (at p233)
30. We are not constrained to accept a view which commended itself to three members only of this Court, however influential their opinion may be. The interpretation and application of the expression "trading corporation" is not foreclosed by that opinion or by a majority constitutional decision in which no more than five members of this Court participated. For my part, I prefer the minority view as expressed in the St. George County Council Case, in particular the remarks of Barwick C.J. (1974) 130 CLR, at pp 542-543 , when his Honour said that to fall within s. 51 (xx.) it is not necessary that a corporation be formed for trading or financial purposes and that "the activities of a corporation at the time a law of the Parliament is said to operate upon it will determine whether or not it satisfies the statutory and therefore the constitutional description". (at p233)
31. "Trading corporation" is not and never has been a term of art or one having a special legal meaning. Nor, as the Chief Justice pointed out, was there a generally accepted definition of the expression in the nineteenth century. Essentially it is a description or label given to a corporation when its trading activities form a sufficiently significant proportion of its overall activities as to merit its description as a trading corporation. (at p233)
32. Even if, and this has not been established, the description was somewhat less liberally applied circa 1900 than it is today, this Court should, in applying the expression, give effect to the content which it is recognized as having at this time. The expression was no doubt used in the contemplation that the power would extend to such corporations as should from time to time be described as trading corporations and in accordance with the principle that words in the Constitution are not restricted to the denotations which they had in 1900. In Lansell v. Lansell [1964] HCA 42; (1964) 110 CLR 353, at p 366 Taylor J. said ". . . although the meaning of these terms does not change, their denotation must extend as new concepts develop". The distinction between meaning and denotation is not without its difficulties. However, for present purposes they need not be pursued. Suffice it to say that, even if the expression was rather less extensively applied at the turn of the century, it nevertheless denoted a corporation which was engaged in trading activities in the sense already explained. (at p234)
33. Not every corporation which is engaged in trading activity is a trading corporation. The trading activity of a corporation may be so slight and so incidental to some other principal activity, viz. religion or education in the case of a church or school, that it could not be described as a trading corporation. Whether the trading activities of a particular corporation are sufficient to warrant its being characterized as a trading corporation is very much a question of fact and degree. It is to this question, as it arises in relation to the facts of this case, that I now turn. (at p234)
34. The trading activities of the prosecutors and the S.A. League, as revealed by the evidence, are so extensive as to leave no doubt in my mind that they are trading corporations. The W.A. League and the S.A. League are engaged in trading activities on a very substantial scale. The W.A. League has as its principal object the promotion, control, management and encouragement of Australian Rules football matches and competitions. It controls and manages the competition between the Perth clubs, adjudicating on disputes between clubs and on complaints against officials and players, imposing penalties where they are considered appropriate. The clubs are members of the League and pay a small subscription to it. The proceeds of each League competition match are received by the League. Under its constitution the W.A. League retains 20 per cent of these proceeds or such greater percentage as it may require, and the balance is equally divided among the member clubs. In the last three years the amounts distributed among the member clubs have been (1975) $525,921, (1976) $594,722 and (1977) $754,133. Total gate receipts derived in the last two years have been (1976) $1,102,150 and (1977) $1,310,587. Total revenue received by the League in those years has been (1976) $1,290,196 and (1977) $1,630,314. Apart from gate receipts from competition matches the League has a variety of other sources of income. They include: (a) receipts from interstate and other matches which it promotes or arranges; (b) receipts from broadcasting and television rights granted in respect of games which it promotes or arranges; (c) income from promotion, sponsorship and advertising; (d) rent for use of part of its premises; (e) catering rights at Subiaco Oval in Perth which it holds on lease; (f) income from the sale of, and advertising revenue from, its weekly programme. The income from sales in the last three years was as follows: (1975) $58,066, (1976) $58,427 and (1977) $84,876. (at p235)
35. The S.A. League has a principal object which is similar to that of its sister League in W.A. It engages in, and derives income from, similar activities to those engaged in by the W.A. League. It is entitled to gate receipts from matches which it arranges, matches in which a team representing the S.A. League participates, and matches in which its clubs participate. The S.A. League owns Football Park which is the principal venue for football in Adelaide. The constitution of the League requires that a certain proportion of its income be credited to a fund for the development and maintenance of Football Park. The constitution contains other provisions authorizing a distribution of portion of the League's revenue amongst the member clubs. The amounts distributed to clubs in the past two years have been (1976) $470,000 and (1977) $515,000. In the same period gate receipts from grounds other than Football Park amounted to (1976) $702,174 and (1977) $821,180. In the same period the income derived at Football Park was (1976) $560,635 and (1977) $706,892. Other sources of revenue are - (a) members' subscriptions at Football Park, sale of season, presale and other tickets; (b) hire of Football Park; (c) catering fees; (d) advertising rights and sponsorships; (e) car park receipts; (f) interstate matches; (g) television and broadcasting fees. (at p235)
36. The prosecutors' case is that the trading activities of the two Leagues are incidental to their main objects which are the promotion and encouragement of the sport as a recreation. This to my mind is an inversion of the true position. To me it seems that the sport is promoted and encouraged as a means of ensuring the receipt of the large financial returns which are associated with it. The financial revenue of the Leagues is so great and the commercial means by which it is achieved so varied that I have no hesitation in concluding that trading constitutes their principal activity. In saying this I treat all their activities which I have listed and which produce revenue as trading activities. I do not limit the concept of trading to buying and selling at a profit; it extends to business activities carried on with a view to earning revenue. (at p235)
37. Likewise, in my opinion West Perth is a trading corporation, though it stands in a somewhat different category. Its principal objects are to foster Australian Rules football, to provide facilities for playing it and to provide recreational and sporting facilities for its members. According to its constitution, the income and property of the club are to be applied solely towards the promotion of the objects of the club. It is expressly provided that no part of the income and property shall be paid or transferred, directly or indirectly, to the members. The fact that no part of the club's revenue or profit can be distributed to the members is a circumstance to be taken into account in deciding whether it is a trading corporation, though in my judgment it is outweighed by other considerations which point to the conclusion that West Perth is a trading corporation. (at p236)
38. West Perth derives income from two main sources: first, from the operations of its football team in the competition run by the W.A. League; secondly, from various trading activities which it conducts. The first source of income includes the distribution received by it as a member club of the W.A. League and membership fees for admission to matches in which its teams participate. The second source of income is from bar trading and catering. Its gross income from bar trading was (1976) $116,277 and (1977) $139,644. Its net profit on trading in those years was (1976) $41,087 and (1977) $49,925. A third and minor source of income is revenue from the sale of club ties, objects and souvenirs. (at p236)
39. The fact that West Perth is a club and that therefore its sales of liquor and food are largely made to members does not in my view affect its character as a trading corporation. There is no reason why an incorporated club which is heavily engaged in trading activities should not be held to be such a corporation, despite the fact that its trading activities are related to its character as a club and that it provides social functions, amenities and services for its members. (at p236)
40. The principal activity of the Club is its participation as a member club of the W.A. League in the competitions which it runs. Indeed, that is West Perth's major source of income. The comment which Fletcher Moulton L.J. made of the Crystal Palace Club in Walker v. Crystal Palace Football Club Ltd. (1910) 1 KB 87 applies with equal force to West Perth. His Lordship said (1910) 1 KB, at p 92 : "Here is a company that carries on the game of football as a trade, getting up and taking part in football matches." The only qualification to be made is that West Perth does not arrange or manage the competition matches. (at p236)
41. The evidence gives some indication of the promotion and encouragement of country and junior football by the club. This activity may well enhance its prospects of recruiting players and strengthen its competitive position as a member club of the W.A. League. But even if it proceeds from loftier motives, it is consistent with the club having the character of a trading corporation. The trader is sometimes inspired by altruism. Consequently, it is my opinion that West Perth, like the two Leagues, is a trading corporation. (at p237)
42. It was also argued that the National League is a trading corporation. However, this is not a question which I find it necessary to consider in light of the conclusions already reached that the prosecutors and the S.A. League are corporations of that kind. (at p237)
43. The respondents argue that the prosecutors and the S.A. League are engaged in interstate trade. There is no evidence to indicate that they are so engaged in any shape or form. It was submitted that the fact that they arrange, promote and participate in interstate matches puts them into interstate trade. The argument does not merit serious consideration. No one who has bothered to read the decisions of this Court relating to the power to legislate with respect to trade, commerce and intercourse among the States, in particular (W. & A.) McArthur Ltd. v. Queensland [1920] HCA 77; (1920) 28 CLR 530, at pp 540, 559-560 and H. C. Sleigh Ltd. v. South Australia [1977] HCA 2; (1977) 136 CLR 475, at pp 495, 507-508 , could conceive that there is any foundation for this argument. (at p237)
44. However, this conclusion is of no avail to the prosecutors in this Court for, on the views which I have already expressed, prohibition does not lie and the prosecutors and the S.A. League are shown by the evidence to be trading corporations. (at p237)
45. The order nisi should be discharged. (at p237)
JACOBS J. I agree with the opinions expressed by Mason J. on all aspects of the matter before us and I am unable usefully to add to the reasons which he has expressed. I would discharge the order nisi. (at p237)
MURPHY J. The applicants challenge the jurisdiction of the Federal Court to hear and determine proceedings against them under s. 45 (2) of the Trade Practices Act 1974, as amended. They seek a writ of prohibition under s. 75 (v) of the Constitution (see also s. 33 of the Judiciary Act 1903, as amended) to prevent further proceeding by the Federal Court. (at p237)
2. The proceedings in the Federal Court are by a professional football player, Mr. Adamson, for injunctions against the prosecutors and the South Australian National Football League (Incorporated) (the "S.A. League") to observe s. 45 (2) of the Act which forbids corporations making or giving effect to contracts, arrangements or understandings (or provisions of these) which, amongst other things, restrict the supply of services (see s. 4D), or substantially lessen competition. (at p238)
3. The evidence before us shows that the prosecutors and the S.A. League have participated in carrying on a system under which Mr. Adamson is prevented (except under very restrictive conditions) from playing with Norwood, a club in South Australia without a clearance from the team, West Perth in Western Australia, to which he is bound under the system. The injunctions sought are to allow him to play without a clearance. (at p238)
4. The Federal Court is a superior court of limited jurisdiction. It is not subject to writs from any other court except the High Court. The Federal Court cannot make any valid curial order unless it has jurisdiction. It has authority, subject to the writs or orders of this Court, to decide whether it has jurisdiction, but not conclusively. If it decides the question of its jurisdiction wrongly, the decision is not binding on this Court and may be corrected by a writ under s. 75 (v.) of the Constitution or an order under s. 33 (1) of the Judiciary Act. (at p238)
5. If this Court determines that the Federal Court has or has not jurisdiction, a writ may issue. The determination may be made by this Court before the Federal Court has concluded whether it has jurisdiction; but in my opinion, this should usually be done only in a clear case and even then a writ should not in general issue unless there is some reason to apprehend that the Federal Court will decide the question wrongly in circumstances where the party seeking the writ may be prejudiced. (at p238)
6. The Federal Court has jurisdiction if any of the applicants or the S.A. League is a corporation within s. 4 of the Act or if any is engaged in trade and commerce among the States (see s. 6 (2) of the Act). (at p238)
7. The question whether either of the prosecutors or the S.A. League is a corporation within s. 4 of the Trade Practices Act in this case depends on whether they are trading corporations within the corporations power. My conclusion is that each is a trading corporation. (at p238)
8. In s. 51 (xx.) of the Constitution, the word, corporations, is not used in any narrow sense. For example, foreign corporations may include syndicates or joint ventures, common in European and other legal systems whose law of incorporation is based on principles different from those of Australian States and England. A corporation is an entity with status as an artificial person; this involves it having its own capacities rights and liabilities which are distinct from those of its members (if it has any members) (see Chaff and Hay Acquisition Committee v. J.A. Hemphill & Sons Pty. Ltd. [1947] HCA 20; [1947] HCA 20; (1947) 74 CLR 375 ). The three bodies concerned here are corporations. The constitutional description of trading corporations includes those bodies incorporated for the purpose of trading; and also those corporations which trade. A corporation which trades is a trading corporation even if it gained incorporation under an Act which forbids trading. The suggestion that such a corporation ceases to be one when engaged in the forbidden activity resembles the submission which was rejected by Fullagar J. in Williams v. Hursey [1959] HCA 51; (1959) 103 CLR 30 where he stated that the notion of qualified legal personality is unintelligible. (at p239)
9. Trading is a term of very wide scope (see Bank of New South Wales v. The Commonwealth [1948] HCA 7; (1948) 76 CLR 1, at p 381 Dixon C.J.; National Association of Local Government Officers v. Bolton Corporation (1943) AC 166, at pp 184-185 , per Lord Wright). (at p239)
10. Even though trading is not the major part of its activities, the description, "trading corporation" does not mean a corporation which trades and does nothing else or in which trading is the dominant activity. A trading corporation may also be a sporting, religious, or governmental body. As long as the trading is not insubstantial, the fact that trading is incidental to other activities does not prevent it being a trading corporation. For example, a very large corporation may engage in trading which though incidental to its non-trading activities, and small in relation to those, is nevertheless substantial and perhaps exceeds or is of the same order in amount as the trading of a person who clearly is a trader. Such a corporation is a trading corporation and is the subject of the legislative power in s. 51 (xx.). That power is subject to the Constitution and may be limited by other provisions, for example, s. 116 would protect a religious body which was a trading corporation from laws which would prohibit the free exercise of religion. The corporations power may be used not only to protect persons who trade with trading corporations, but also to protect trading corporations in regard to those who deal with them. (at p239)
11. It follows that in my view Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [1974] HCA 7; (1974) 130 CLR 533 was wrongly decided and should be overruled. (at p239)
12. The question is not whether the prosecutors and the S.A. League are sporting clubs (no doubt, they are), but whether any of them is a trading corporation. Afew centuries ago trade was mostly centred around primary industry, a generation or so ago mostly around secondary industry; now it is overwhelmingly centred around tertiary industry. Most Australian workers now work in areas of entertainment, information, education, health, tourism, leisure, sport, transport and similar services. Many activities which once would not have been regarded as trade have come to be recognized as trade (see Walker v. Crystal Palace Football Club Ltd. (1910) 1 KB 87 and Brimelow v. Casson (1924) 1 Ch 302 ). The commercialization of sport, education, religion, medicine and other social or professional activities is a world-wide phenomenon. The prosecutor, Western Australian National Football League (Incorporated) and the S.A. League are engaged in very substantial trading, in charging for admission, putting on public spectacles for profit, selling television rights and selling goods; the West Perth Football Club (Incorporated) is a trader on a smaller scale. All three are trading corporations. (at p240)
13. Prohibition should be refused. It is not therefore necessary to decide whether the prosecutors or the S.A. League are also engaged in trade and commerce among the States. (at p240)
14. The order nisi should be discharged. (at p240)
AICKIN J. In this matter I have had the advantage of reading the reasons for judgment prepared by my brother Stephen with which I am in complete agreement. There is nothing which I wish to add on the question whether the corporations in question are "trading corporations" within s. 51 (xx.) of the Constitution; I am satisfied that they are not. (at p240)
2. On the question of the availability of a writ of prohibition I would add that, in my opinion, the existence of a right of appeal from the tribunal sought to be prohibited is not a basis for refusing the writ where want of jurisdiction is made out. The general rule as to prohibition is that it goes ex debito justitiae, though there may be circumstances where it may be refused if there has been acquiescence, waiver or delay, but even those are limited (see Broad v. Perkins (1888) 21 QBD 533 ). The existence of an alternative remedy does not destroy the right to a prohibition or give a discretion to refuse it: Burder v. Veley [1840] EngR 36; (1840) 12 Ad & E 233, at p 263 [1840] EngR 36; (113 ER 801, at p 812) per Denman C.J. in the Court of Queen's Bench, and see the same case in the Court of Exchequer Chamber (1841) 12 Ad & E 265, at pp 313-314 (113 ER 813, at p 831) , per Tindal C.J.; R. v. Justices of Brisbane; Ex parte The Treasurer (Q.) (1901) 11 QLJ 77, at p 79 , per Griffith C.J., as well as the cases cited by the Chief Justice in the present case. (at p241)
3. Here the alleged absence of jurisdiction does appear on the face of the proceedings in the sense in which that expression is used in this context: Farquharson v. Morgan (1894) 1 QB 552, at p 563 ; Alderson v. Palliser (1901) 2 KB 833, at p 836 , per Vaughan Williams L.J. It is therefore proper, as well as convenient, for the Court to consider at this stage whether there is want of jurisdiction in the Federal Court. The judges of the Federal Court are officers of the Commonwealth within the meaning of s. 75 (v.) of the Constitution and accordingly prohibition will issue to them in a proper case. (at p241)
4. In my opinion the Federal Court has no jurisdiction to entertain the proceedings now in question because the only basis on which its jurisdiction could rest depends on the corporations in question being "trading corporations" within the meaning of that expression in s. 51 (xx.). In my opinion they are not trading corporations in that sense and accordingly I would make the order nisi absolute. (at p241)
ORDER
Order nisi for writ of prohibition discharged.Prosecutors to pay the respondent's costs.
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