New South Wales v Brian McMullin & Anor [1997] FCA 120 (28 February 1997)

CATCHWORDS

Statutory Interpretation - retrospective operation of legislation - rules of construction - procedural or substantive character of legislation - statutory extinction of causes of action - "aggregate justice" - meaning of the expression "no action, suit or proceeding for damages lies..."

Agricultural and Veterinary Chemicals (New South Wales) Act 1994 (NSW) s.31(1) and (2).

Agricultural and Veterinary Chemicals Code Act 1994 (Cth)

Agricultural and Veterinary Chemicals (Administration) Act 1992 (Cth)

Pesticides Act 1978 (NSW)

Georgiadis v. Australian and Overseas Telecommunications Corporation [1994] HCA 6; (1994) 179 CLR 297

Maxwell v. Murphy [1957] HCA 7; (1956) 96 CLR 261

Kraljevich v. Lake View and Star Limited [1945] HCA 29; (1945) 70 CLR 647

George Hudson Limited v. Australian Timber Workers' Union [1923] HCA 38; (1923) 32 CLR 413

McKain v. R W Miller & Co (SA) Pty Limited [1991] HCA 56; (1991) 174 CLR 1

Minister for Youth and Community Services v. Health and Research Employee's Association of Australia (NSW Branch) (1978) 10 NSWLR 543

Newfoundland (Board of Commissioners of Public Utilities) v. MacDonald (1991) 49 Admin LR 48

THE STATE OF NEW SOUTH WALES v. BRIAN McMULLIN and LEONE MARGARET McMULLIN

No. NG819 of 1996

BEAUMONT, O'LOUGHLIN AND MOORE JJ.

SYDNEY

28 February 1997

IN THE FEDERAL COURT OF AUSTRALIA )

)

NEW SOUTH WALES DISTRICT REGISTRY ) No. NG819 of 1996

)

GENERAL DIVISION )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN: THE STATE OF NEW SOUTH WALES

Appellant

AND: BRIAN McMULLIN and LEONE MARGARET McMULLIN

Respondents

CORAM: Beaumont, O'Loughlin and Moore JJ.

DATE: 28 February 1997

ORDERS

THE COURT ORDERS:

Appeal dismissed, with costs.

Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA )

)

NEW SOUTH WALES DISTRICT REGISTRY ) No. NG819 of 1996

)

GENERAL DIVISION )

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN: THE STATE OF NEW SOUTH WALES

Appellant

AND: BRIAN McMULLIN and LEONE MARGARET McMULLIN

Respondents

CORAM: BEAUMONT, O'LOUGHLIN AND MOORE JJ.

DATE: 28 February 1997

REASONS FOR JUDGMENT

BEAUMONT AND O'LOUGHLIN JJ.

INTRODUCTION

The appellant, the State of New South Wales ("the State"), has been sued for damages for common law negligence and for breaches of provisions of the Fair Trading Act 1987 (NSW). The background to the claim, which arises out of the use of a cotton insecticide, known as "Helix", between 1989 and 1994, is, in outline, as follows:

On 20 February 1989, the Registrar of Pesticides registered "Helix" under the Pesticides Act 1978 (NSW).

On 1 July 1989, an earlier national scheme dealing with agricultural and other chemicals was enacted in the Agricultural and Veterinary Chemicals Act 1988 .

On 15 March 1995, after the "Helix" was used and the alleged damage caused, the national statutory "Agvet Code" commenced its operation under the provisions of the Agricultural and Veterinary Chemicals Code Act 1994 and corresponding State enactments, including the Agricultural and Veterinary Chemicals (New South Wales Act 1994 (NSW) ("the NSW Act 1978 "). As a consequence, the prior registration of "Helix" under the Pesticides Act (NSW) was treated as registration under the Code, so that for the purposes of the Code, "Helix" is a "registered chemical product".

On 3 May 1995, the respondents, Brian McMullin and Leone Margaret McMullin, instituted these proceedings.

By its defence in these proceedings, the State relies upon s.31(1) of the NSW Act 1988 and pleads that, by virtue of its provisions, the State "is not liable to" the respondents.

Section 31(1) relevantly provides:

"31(1) No action, suit or other proceeding for damages lies against the State... for any loss or injury directly or indirectly suffered as a result of:

(a) ...; or

(b) the handling [which is defined so as to include `use'] of a registered chemical product; or

(c) the handling of an active constituent for a proposed or existing chemical product, or of a chemical product, in respect of which a permit or exemption has been issued or given by the NRA [National Registration Authority]; or....." (Emphasis added).

THE PROCEEDINGS AT FIRST INSTANCE

At first instance, the State moved for the summary dismissal of the proceedings on the basis that, in law, the State had an unanswerable defence (see General Steel Industries Inc. v. Commissioner for Railways (NSW) [1964] HCA 69; (1964) 112 CLR 125 per Barwick CJ. at 137). On behalf of the State, it was contended that the defence or exemption provided by s.31(1) was available because the respondents had commenced their proceedings in May 1995, that is, on a date after the commencement of the operation of s.31(1) on 15 March 1995.

THE REASONING AT FIRST INSTANCE

The learned primary Judge, Wilcox J., held that s.31(1) was capable of application, according to its terms, to claims of the kind made by the respondents, in that "Helix" was, for present purposes, a "registered chemical product", and the proceedings were for loss allegedly suffered as a result of the use of the product.

However Wilcox J. went on to hold that, because of the presumption against retrospectivity, s.31(1) could not be invoked with respect to a cause of action, as here, that had vested before the commencement of the NSW Act.

On the meaning of the phrase "no action... lies..." in s.31(1), Wilcox J., applying the reasoning of the High Court in dealing with that phrase used in s.44(1) of the Safety Rehabilitation and Compensation Act ("the SRC Act 1994 ") in Georgiadis v. Australian and Overseas Telecommunications Corporation [1994] HCA 6; (1994) 179 CLR 297, said:

"Georgiadis is of present interest because of its characterisation of s.44(1). In this regard there is no difference between the views expressed by the majority and minority Justices. Mason CJ, Deane and Gaudron JJ said at 306: `... the effect of s.44, if valid, is to extinguish a vested cause of action that arose under the general law'. Brennan J at 310 referred to `the extinguishment of the plaintiff's cause of action'. Dawson J at 314 said that the 1988 Act `purported to extinguish the plaintiff's claim for damages for his back injury'. At 318 Toohey J spoke of the `extinguishment' of the plaintiffs common law action for damages. McHugh J at 322 said that `(t)he 1988 Act extinguishes all rights to sue the Commonwealth... for damages for injuries...'.

I do not see any material distinction between the language used in s.31(1) of the NSW Act and that of s.44(1) of the SRC Act; the characterisation adopted in Georgiadis must apply to s.31(1). Contrary to the tentative view I earlier expressed, that subsection must be regarded as a provision extinguishing the right, not merely one that bars the remedy."

His Honour went on to say:

"Unlike s.44(1) of the SRC Act, s.31(1) of the NSW Act contains no indication that it was intended to apply to losses or injuries sustained before its commencement. There are no words corresponding to s.44(1)'s `whether that injury... occurred before or after the commencement of this section'. There is no reference to already- commenced proceedings. Nor does the subsection refer to things that could only have happened, or losses or injuries that could only have been sustained, before its enactment. ..... To construe it as having only a prospective operation does no violence to the language of s.31(1)."

Wilcox J. referred to the following summary of principles by Sloane JA. in Dixie v. Royal Columbian Hospital (1941) 2 DLR 138 (at 139-140), which was adopted by Dixon CJ. as a "practical summary" of the relevant principle in Maxwell v. Murphy [1957] HCA 7; (1956) 96 CLR 261 (at 270):

"unless the language used plainly manifests in express terms or by clear implication a contrary intention - (a) A statute divesting vested rights is to be construed as prospective. (b) A statute, merely procedural, is to be construed as retrospective. (c) A statute which, while procedural in its character, affects vested rights adversely is to be construed as prospective."

In dismissing the State's motion, Wilcox J. said:

"Once it is determined, as a matter of construction, that s.31(1) operates to extinguish rights, and not merely to bar remedies, it must be concluded that the presumption against retrospectivity applies. On the Georgiadis analysis, it is a provision `divesting vested rights', within para. (a) of Dixon CJ's summary of principles. It has the effect of `attaching new legal consequences' to facts that occurred before its commencement. Of course, the presumption against retrospectivity is only that, a presumption. A disposition to treat a statutory provision as not operating retrospectively must yield to any indication of a contrary intention, as in Georgiadis. But, as I have pointed out, s.31(1) contains no such indication. Accordingly, it should be understood not to apply to causes of action that accrued before its commencement. That is the present case. I hold that the subsection has no application to this case."

THE STATE'S GROUNDS OF APPEAL

The State now appeals, by leave granted, on the following grounds:

"5. His Honour erred in finding that Section 31(1) of the Agricultural and Veterinary Chemicals (New South Wales) Act (`the NSW Act') had the effect of extinguishing a vested cause of action rather than having the effect of denying to the [respondents] the remedy of bringing the present suit.

6. His Honour erred in finding that Section 31(1) of the NSW Act contains no indication that it was intended to apply to losses or injuries sustained before its commencement.

7. His Honour erred in concluding that the presumption against retrospectivity applied to Section 31(1) of the NSW Act in circumstances where:

(i) the NSW Act came into force on 15 March 1995;

(ii) the [respondents'] damage occurred between 1989 and 1994;

(iii) the [respondents] instituted proceedings on 3 May 1995."

CONCLUSIONS ON THE APPEAL

In our opinion, Wilcox J. was correct in dismissing the State's motion for the reasons he gave.

The learned Solicitor-General developed the State's grounds of appeal in a number of respects. It will be convenient to deal in turn with each of the issues raised by the several aspects of his argument.

(a) Is s.31(1) procedural or substantive in character?

On behalf of the State, it is submitted that s.31(1) falls within category (c) of Sloane JA.'s summary, that is, it is procedural in character, but it affects vested rights adversely.

In our opinion, the relevant distinction to be drawn in this area is between legislation that is "merely" procedural, and presumed to operate retrospectively, on the one hand, and legislation that in form appears to be procedural but which is, in truth, substantive in its operation, and presumed to operate prospectively, on the other. A provision altering the manner of enforcing a right would usually be of the former, "presumed retrospective" kind. On the other hand, a provision barring the pursuit of a claim absolutely, thus extinguishing the cause of action would be of the latter, "presumed prospective" kind.

In Kraljevich v. Lake View & Star Limited [1945] HCA 29; (1945) 70 CLR 647, Dixon J. said (at 652):

"The presumptive rule of construction is against reading a statute in such a way as to change accrued rights the title to which consists in transactions passed and closed or in facts or events that have already occurred. In other words, liabilities that are fixed, or rights that have been obtained, by the operation of the law upon facts or events for, or perhaps it should be said against, which the existing law provided are not to be disturbed by a general law governing future rights and liabilities unless the law so intends, appears with reasonable certainty. But, when the alteration in the law relates to the mode in which rights and liabilities are to be enforced or realized, there is no reason to presume that it was not intended to apply to rights and liabilities already existing and its application in reference to them will depend rather upon its particular character and the substantial effect that such an operation would produce.

In the present case, we have an example of a provision which at first sight looks to be expressed in terms more appropriate to procedure, but one, in substance, measuring liability. For to prescribe the basis of calculating redemption is in reality to express the measure of liability. But, when the statute is examined in detail, the form also of the amended clause is seen less as a statement about proceedings for the realization of rights than as a delimitation of their measure."

In Maxwell v. Murphy, above, Williams J. said (at 279- 280):

"The right to enforce a cause of action (sometimes called an accrued claim) is an existing substantive right: Gillmore v. Executor of Shooter; Henshall v. Porter; Brueton v. Woodward. It is of the same character as the right to prosecute an appeal which was held by the Privy Council in Colonial Sugar Refining Co. v. Irving to be in this category. There can be no distinction in principle between a right given by law to commence an action and a defence given by law which bars an action. A law which has the effect of taking away such a right or immunity could not be classed as merely procedural. Procedural statutes are statutes which regulate the procedure and practice of the courts: Wright v. Hale. The Statute of Frauds and Lord Tenterden's Act 1987 are examples of statutes which relate to procedure but they have been held to affect substantive rights and therefore to be prima-facie statutes which should not be construed as having a retrospective operation."

See now also to the same effect, on the procedural/substantive distinction, McKain v. R.W. Miller & Co. (S.A.) Pty Limited [1991] HCA 56; (1991) 174 CLR 1, per Brennan, Dawson, Toohey and McHugh JJ. at 43-4; see also Georgiadis, above, at the passages cited by Wilcox J.

In our view, this reasoning is directly applicable here. That is, although s.31(1) speaks of remedies, its operation, in substantive terms, is to extinguish the cause of action absolutely. It follows, in our opinion, that s.31(1) should be presumed to operate prospectively and thus not to destroy causes of action previously accrued.

(b) Is the presumption of prospectivity displaced here?

It is true, as the learned Solicitor-General submitted, that the foregoing deals only with a presumption of interpretation, not a rule of law. He went on to submit that, by virtue of both the provisions of s.31(2) of the NSW Act and the application of the "aggregate justice" approach, the presumption of prospectivity was displaced.

Section 31(2) is in these terms:

"31(2) If an action, suit or other proceeding is brought against a person responsible for the importation, manufacture, supply or handling of:

(a) ...

(b) a registered chemical product; or

(c) ...

(d) ...

in relation to any loss or injury directly or indirectly suffered because of the importation, manufacture, supply or handling of the constituent or product, it is not a defence to that action, suit or other proceeding that the NRA had approved the constituent, registered the product, issued a permit or given an exemption in relation to the constituent or the product or issued a licence in relation to a step in the manufacture of the product."

The "basic principle" which calls for an inquiry into the overall impact of the relevant legislative instrument ("aggregate justice"), was discussed by Isaacs J. in George Hudson Limited v. Australian Timber Workers' Union [1923] HCA 38; (1923) 32 CLR 413, in the following passage (at 434), which is now much relied on by the State:

"[The basic] principle is stated in Maxwell on Statutes, 6th ed., at p.381, on the authority of the Institutes (2 Inst., 292) in these terms: `Upon the presumption that the Legislature does not intend what is unjust rests the leaning against giving certain statutes a retrospective operation.' That is the universal touchstone for the Court to apply to any given case. But its application is not sure unless the whole circumstances are considered, that is to say, the whole of the circumstances which the Legislature may be assumed to have had before it. What may seem unjust when regarded from the standpoint of one person affected may be absolutely just when a broad view is taken of all who are affected. There is no remedial Act which does not affect some vested right, but, when contemplated in its total effect, justice may be overwhelmingly on the other side."

In discussing these observations in the context of the rationale of the presumption against retrospectivity, D.C. Pearce and R.S. Geddes, Statutory Interpretation in Australia, 4th ed., say (at 248):

"While a legislative instrument may take away some rights it may confer others and the overall aggregate justice may indicate that retrospectivity was intended. In determining this issue, regard needs to be paid to the problem with which the legislation was intended to deal: cf Baker v Australian Asbestos Insulations Pty Ltd (1985) 3 NSWLR 280 at 289. The presumption is a rule of construction and the context in which the relevant provision appears will ultimately determine its effect: cf Nicholas v Commr for Corporate Affairs [1988] VR 289 at 300-301 per Fullagar J."

In our opinion, George Hudson, above, is distinguishable for present purposes. As Kirby P. observed in Baker, above (at 289), the dicta of Isaacs J. in George Hudson may be viewed as authority for the proposition that -

"The deprivation of rights that have accrued may, in some circumstances (emphasis added), be justifiable by reference to considerations of aggregate justice, as for example where, although some rights are taken away, others are afforded..."

It is difficult to generalise in this area, since questions of degree are necessarily involved.

Moreover, the context will always be important. In George Hudson, the context was industrial arbitration, in which an agreement had been reached in settlement of a dispute. The question was whether the agreement was binding on the employer's successor. The validity of the Commonwealth remedial statute, and its possible retrospective operation, were in issue. In holding that a retrospective operation was a just outcome, Isaacs J. took a global view of the entire legislative package, viewing it as the chosen legislative method of securing, amongst other things, "the general rights of the public to a maintenance of industrial peace" (at 435). He said (at 435):

"Parliament does not act in such a case without a comprehensive view of the situation."

But, in the present case, it is not apparent that the presence of s.31(2) serves as a "quid pro quo", as it were, so as to justify an implication that s.31(1) is to operate retrospectively. At the same time, in an industrial context, the importation of a "give and take" notion is readily understood.

It is true that s.31(2) does eliminate one possible line of defence by a person responsible for the importation, manufacture, supply or handling of a registered chemical product; and that, to this extent, a potential benefit could accrue to claimants in the position of the respondents. However, s.31(1) operates in different territory, by extinguishing absolutely certain accrued causes of action (i.e. choses in action - see e.g., Georgiadis per Brennan J. at 311) available against the State. Given the different defendants involved, and having regard to the absolute extinction of a cause of action, on the one hand, and the removal of only one (of many possible) line of defence, on the other, we have difficulty in accepting that the provisions of s.31(2) are of such significance as to displace the usual presumption of prospectivity in the cases of an extinguishment provision such as s.31(1). In our view, to accord such weight to s.31(2), limited as its operation must be, would bring about an unjust outcome, an intention not to be lightly attributed to the legislation.

In our opinion, s.31(2) is a free-standing provision which has no material bearing upon the present question. Section 31(2) is not expressed to be interdependent with s.31(1) and the converse is also true. Nor is there any reason, for present purposes, to imply any such interdependence. Each provision has its own, distinct operation and it is extremely difficult, if not impossible, to attempt any comparative assessment of their respective operation for the purposes of an "aggregate justice" exercise.

(c) Conclusion on the construction of s.31.

It follows, we think, that there is nothing in the present context, and no other reason, to displace the ordinary presumption that an extinguishment provision, as s.31(1) is, will apply only to causes of action arising after its commencement.

It further follows that the appeal should be dismissed, with costs.

I certify that this and the preceding twelve (12) pages are a true copy of the Reasons for Judgment herein of Justices Beaumont and O'Loughlin.

Associate

Dated: 28 February 1997

THE FEDERAL COURT OF AUSTRALIA )

)

NEW SOUTH WALES DISTRICT REGISTRY ) No. NG 819 of 1996

)

GENERAL DIVISION )

BETWEEN: THE STATE OF NEW

SOUTH WALES

Applicant

AND: BRIAN McMULLIN and LEONE McMULLIN

Respondent

JUDGE: Beaumont, O'Loughlin and Moore JJ

PLACE: Sydney

DATE: 28 February 1997

REASONS FOR JUDGMENT

Moore J: This is an appeal by the State of New South Wales ("the State") against orders made by Wilcox J on 25 September 1996. Wilcox J dismissed a notice of motion brought by the State seeking the summary dismissal of proceedings by Brian McMullin and Leone McMullin. Leave to appeal was granted on 9 October 1996.

The State was one of seven respondents to the proceedings instituted by the McMullins ("the principal proceedings") on 3 May 1995. They are representative proceedings and arose from the use of cotton by- products as feed for cattle. The cotton by-products were said to contain the residue of an insecticide, Helix, which contaminated the meat and meat products derived from the cattle.

The liability of the State in the principal proceedings is alleged to arise under s 42 of the Fair Trading Act (NSW) as a result of representations concerning the use that could be made of the insecticide. Negligence of the State is also pleaded. It is unnecessary to particularise the claims in the principal proceedings further except to note that in this appeal it was common ground that the causes of action were based on events occurring before 15 March 1995 and thus were causes of action that arose before then. That date is significant because it is when the Agricultural and Veterinary Chemicals (New South Wales) Act 1994 (NSW) ("the 1994 NSW Act") commenced.

The application by the State for summary dismissal of the proceedings against it was founded on s 31 of the 1994 NSW Act. That section provides:

"31(1) No action suit or other proceeding for damages lies against the State or a person who is or has been a co-ordinator of this jurisdiction for any loss or injury directly or indirectly suffered as a result of:

(a) the handling of an approved active constituent for a proposed or existing chemical product, or

(b) the handling of a registered chemical product; or

(c) the handling of an active constituent for a proposed or existing chemical product, or of a chemical product, in respect of which a permit or exemption has been issued or given by the NRA; or

(d) an inability to use, or to use in a particular manner, an active constituent for a proposed or existing chemical product:

(i) because an approval, permit or exemption permitting its use, or permitting its use in that manner, has been refused by the NRA or such an approval, permit or exemption that was previously granted by the NRA has been suspended or cancelled; or

(ii) because its use, or its use in that manner, is precluded by the conditions of an approval, permit or exemption; or

(e) an inability to use, or to use in a particular manner, a chemical product:

(i) because a registration, permit or exemption permitting its use, or permitting its use in that manner, has been refused by the NRA or such a registration, permit or exemption that was previously granted by the NRA has been suspended or cancelled; or

(ii) because its use, or its use in that manner, is precluded by the conditions of a registration, permit or exemption; or

(f) the carrying out of a step in the manufacture of a chemical product in respect of when a licence has been issued by the NRA; or

(g) an inability to carry out, or to carry out in a particular manner or at particular premises, a step in the manufacture of a chemical product:

(i) because a licence to carry out that step, or to carry out that step in that manner or at those premises, has been refused by the NRA or such a licence that was previously granted by the NRA has been suspended or cancelled; or

(ii) because the carrying out of that step, or the carrying out of that step in that manner or at those premises, is precluded by the conditions of a licence.

(2) If an action, suit or other proceedings is brought against a person responsible for the importation, manufacture, supply or handling of:

(a) an approved active constituent for a proposed or existing chemical product; or

(b) a registered chemical product; or

(c) an active constituent for a proposed or existing chemical product or a chemical product, in respect of which the NRA has issued a permit or given an exemption; or

(d) a chemical product in respect of a step in the manufacture of which the NRA has issued a licence,

in relation to any loss or injury directly or indirectly suffered because of the importation, manufacture, supply or handling of the constituent or product, it is not a defence to that action, suit or other proceeding that the NRA had approved the constituent, registered the product, issued a permit or given an exemption relation to the constituent or the product, or issued a licence in relation to a step in the manufacture of the product.

(3) Expressions used in this section have the same meanings as in the Agvet Code of this jurisdiction."

The 1994 NSW Act was enacted as part of co-operative legislative measures taken by the Commonwealth and the states to introduce uniform standards for the registration of agricultural and veterinary chemicals. It is unnecessary to repeat the summary of all the relevant legislation which is found in the reasons for judgment of Wilcox J of 25 September 1996. These reasons must be read with earlier reasons for judgment of 29 May 1996 when Wilcox J dismissed the principal proceedings as they related to claims against the Commonwealth and the National Registration Authority for Agricultural and Veterinary Chemicals ("the NRA"). It is sufficient to note at this point that the 1994 NSW Act adopted and rendered applicable as a law of New South Wales, a code directed to establishing standards for the registration of agricultural and veterinary chemicals, the Agvet Code, which was a schedule to the Agricultural and Veterinary Chemicals Code Act 1994 (Cth). While the NRA had been established by earlier Commonwealth legislation, it was to have a central role in the evaluation and registration of agricultural and veterinary chemicals under the Agvet Code. I will later refer to some aspects of the legislative scheme in more detail.

Wilcox J rejected the submission by the State that s 31 operated to preclude proceedings being brought against it after the Act commenced.

Wilcox J's reasoning involved two steps. First, Wilcox J considered the effect, as a matter of construction, of s 31(1). Wilcox J concluded that it was a provision that extinguished a right and was not merely one that barred a remedy. This conclusion was based on what Wilcox J viewed as the similarity in the language of s 31(1) of the 1994 NSW Act and s 44(1) of the Safety, Rehabilitation and Compensation Act 1988 (Cth) ("the Compensation Act"). Sub-section 44(1) of that latter Act had been considered by the High Court in Georgiadis v Australian and Overseas Telecommunications Corporation [1994] HCA 6; (1994) 179 CLR 297 and characterised as having extinguished a cause of action: per Mason CJ, Dean and Gaudron JJ at 306, Brennan J at 310, Dawson J at 314, Toohey J at 318 and McHugh J at 322.

The second step was to determine whether the sub-section operated only prospectively. Wilcox J quoted passages from Dixon CJ's judgment in Maxwell v Murphy [1957] HCA 7; (1956) 96 CLR 261 at 267:

"The general rule of the common law is that a statute changing the law ought not, unless the intention appears with reasonable certainty, to be understood as applying to facts or events that have already occurred in such a way as to confer or impose or otherwise affect rights or liabilities which the law had defined by reference to the past events. But, given rights and liabilities fixed by reference to past facts, matters or events, the law appointing or regulating the manner in which they are to be enforced or their enjoyment is to be secured by judicial remedy is not within the application of such a presumption. Changes made in practice and procedure are applied to proceedings to enforce rights and liabilities, or for that matter to vindicate an immunity or privilege, notwithstanding that before the change in the law was made the accrual or establishment of the rights, liabilities, immunity or privilege was complete and rested on events or transactions that were otherwise past and closed."

and (at 270):

"unless the language used plainly manifests in express terms or by clear implication a contrary intention - (a) A statute divesting vested rights is to be construed as prospective. (b) A statute, merely procedural, is to be construed as retrospective. (c) A statute which, while procedural in its character, affects vested rights adversely is to be construed as prospective."

Wilcox J then concluded that s 31(1) was a provision "divesting vested legal rights" within para (a) of Dixon CJ's summary of the principles. It was presumed to operate prospectively unless there was a contrary intention manifest in the legislation. Wilcox J had earlier concluded that there was no contrary intention.

In the appeal, the case of the State was that s 31(1) should be viewed as a provision that is procedural in character though it accepted that it affects vested rights adversely. That is, it is a provision comprehended by paragraph (c) of the principles referred to by Dixon CJ. Thus the State accepted there was a presumption that s 31(1) operated prospectively only. However, the State submitted that it has a retrospective operation and that is manifest, in particular, by s 31(2). Sub-section 31(2) precludes a defendant from raising a defence based on approval, registration, the issuing of a permit or the granting of an exemption in relation to a chemical product. The sub-section would have that effect from the date of commencement of the Act and would operate in relation to proceedings brought after its commencement. It is also a provision that is procedural in character. Sub-section 31(2) was not mentioned by Wilcox J in his reasons for judgment, though no submission was made by the State to Wilcox J that s 31(2) had any bearing on the construction and effect of s 31(1). The applicants preferred to characterise s 31(1) as a provision that divested vested rights and was thus comprehended by paragraph (a) referred to by Dixon CJ. They denied that s 31 manifests an intention that it is to operate retrospectively.

The issue raised in this appeal is a narrow one and is whether there is manifest in s 31 or elsewhere in the 1994 NSW Act, an intention that s 31(1) operates on a cause of action arising prior to the commencement of the Act by reference to past events.

Given the concession by the State in the appeal that s 31(1) attracts the principles discussed by Dixon CJ in Maxwell v Murphy (supra), it is unnecessary, on one view, to endeavour to determine whether s 31(1) should be characterised as either extinguishing a right or barring a remedy in the way Wilcox J did. However the meaning of s 31(1) should, in my opinion, be addressed because of the State's submission that s 31 in its entirety, is procedural in character.

It may be accepted that the dichotomy between a statutory provision that extinguishes a right and one that bars a remedy is now a settled one. As Brennan, Dawson, Toohey and McHugh JJ said in McKain v R.W. Miller & Co (SA) Pty Ltd [1991] HCA 56; (1991) 174 CLR 1 at 44:

"[T]here is a real distinction between a statute which extinguishes a right to damages and a statute which bars an action to enforce a right to damages, as the decision of this Court in The Commonwealth v Verwayen illustrates. At least the continued existence of a right to damages will furnish consideration for an agreement to settle the plaintiff's claim. But, whether or not a distinction between a statute extinguishing a right and a statute barring an action to enforce the right be thought desirable, it is firmly and clearly established as a principle of law. As the distinction has operated in practice free of injustice, there is no warrant for discarding it."

The provision considered by the High Court in Georgiadis (supra), s 44 of the Compensation Act, relevantly provided:

"(1) Subject to section 45, an action or other proceeding for damages does not lie against ... a Commonwealth authority ... in respect of:

(a) an injury sustained by an employee in the course of his or her employment, being an injury in respect of which the ... Commonwealth authority would, but for this subsection, be liable (whether vicariously or otherwise) for damages;

...

whether that injury, loss or damage occurred before or after the commencement of this section.

(2) Subsection (1) does not apply in relation to an action or proceeding instituted before the commencement of this section."

Section 44 was declared by a majority of the Court to be invalid as it effected the acquisition of property on other than just terms. Its operation was considered in the factual context of the plaintiff, Mr Georgiadis, having been injured in 1985 and 1986 and commencing proceedings on 17 September 1990. Section 44 came into force on 1 December 1988. At the time of the injury Mr Georgiadis had a cause of action against the Commonwealth. In issue was the effect of s 44 on that cause of action.

However the characterisation of s 44 of the Compensation Act by the members of the High Court as a provision extinguishing a cause of action does not necessarily lead to the conclusion that s 31(1) should be similarly characterised because of the use of common language in both sections. First, s 44 contained no provision similar to s 31(2). Section 31(2) is, in my opinion, relevant in determining the meaning of s 31(1), given that, together, they form the one section and each provides the immediate statutory context for the other. Moreover, the characterisation of s 44 as having extinguished existing rights arose in the context of a consideration of whether there had been an acquisition of property for the purposes of s 51(xxxi) of the Constitution. The issue that divided the Court was whether there had been an acquisition on the one hand or merely an extinction of a right on the other which did not attract the provisions of s 51(xxxi). The manner in which s 44 operated to extinguish the cause of action having regard to its terms was not addressed in detail by the Court. Of its operation, Mason CJ, Deane and Gaudron JJ said:

"However, the argument that s. 44 does no more than modify the limitation period applicable to a cause of action which vested before the new scheme began is, in effect, an argument that s.44 is not fairly characterized as a law with respect to the acquisition of property within s. 51(xxxi).

However, it is by no means accurate to describe s. 44 as a law modifying the limitation period applicable to causes of action with respect to injuries sustained by Commonwealth employees before the new scheme came into effect. Subject to s. 45, which does no apply in the present case, s. 44 puts an end to a cause of action against the Commonwealth or its agencies if it was not sued upon before it, s. 44, came into effect. Section 44 operated once and for all as a final measure terminating those causes of action which fall outside s. 45, not as a measure prescribing the time in which proceedings were to be commenced."

What is not clear from this passage is the manner in which s 44 terminated a cause of action. It is to be noted that s 44(1), unlike s 31(1), speaks of an "injury... in respect of which the ... Commonwealth authority would, but for this subsection, be liable". Plainly these words provide a relatively clear indication that s 44 was directed to the underlying liability of, relevantly, the Commonwealth authority and was not simply dealing with the right to seek a remedy.

In my opinion, the starting point in determining the effect of s 31(1) is to ascertain what is meant by the expression "no action, suit or proceeding for damages lies ...". There is considerable force, in my opinion, in the submission of the State that s 31 is directed to matters of procedure, though I accept that the characterisation of a section as procedural may raise as many questions as it answers, as is apparent from the judgments of the High Court in McKain (supra). However, if it is intended to deal with matters of procedure, then the word "lies" in s 31(1), may mean "may be brought" or "may be commenced". It is true, as pointed out by senior counsel for the McMullins, that the word "brought" is used in s 31(2) but not in s 31(1), signifying, it was submitted, that s 31(1) was directed to something other than the bringing of proceedings. At least in the context of s 31(2) "brought" means "commenced" or "instituted": see McManamny v Hadley [1975] VR 705 at 708. However, s 31(2) addresses a future conditional event and the structure of the subsection results in the verb "brought" being in the passive voice. The expression "if an action ... is brought" is an obvious formulation to describe the future conditional event as would be "if an action ... is commenced" or "if an action is ... instituted". However s 31(1) is framed differently. The drafter has elected to use the expression "no action suit or other proceedings for damages" as a nominal phrase which is the subject of the clause constituting the prefatory words of s 31(1). So structured, the verb in the clause must be in the active voice and "lies" would be a more economic way of saying what would be comprehended by the lengthier expressions, "may be commenced" or "may be instituted".

The meaning of the expression "no suit or action shall lie" was considered by the New South Wales Court of Appeal in Minister for Youth and Community Services v Health and Research Employees' Association of Australia, NSW Branch (1987) 10 NSWLR 543. The expression was in s 158(1) of the Child Welfare Act 1939 (NSW) which provided that "no suit or action shall lie against the Minister" for acts done in good faith and with reasonable care. Section 158(3) conferred a power on the Court to stay proceedings if the Court was satisfied that there were no reasonable ground for alleging want of good faith or reasonable care. Kirby P discussed at some length the meaning the expression "no suit or action shall lie". His Honour said at 549-550:

"The words "no suit or action shall lie..." are ambiguous. One possible construction (that urged by the Minister) is that no suit or action shall be commenced. According to this construction, the opening words of the Child Welfare Act, s 158, are addressed at the Registry of the court in which the suit or action is filed. The alternative construction is more consonant with the approach taken to statutory limitation provisions. By conventional theory, limitation statutes do not (unless their language clearly so requires) extinguish causes of action or rob a court of the jurisdiction to hear such actions. Parties may, and frequently do, waive such provisions. The court is then under no obligation, as in a matter of jurisdiction it is, to raise the limitation provision itself: cf Proctor v Jetway Aviation Pty Ltd [1982] 2 NSWLR 264 at 269; [1984] 1 NSWLR 166 at 174; cf Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 374. According to this view, provisions such as the Child Welfare Act, s 158, are not addressed to the jurisdiction of a court, such as, relevantly, the Industrial Commission. They simply provide a defence which may be pleaded by the party in whose favour the provision exists to prevent judgment being entered against it. Although the construction of s 158(1) is not entirely free from doubt, there being ambiguity and the provision being one which limits the rights which would otherwise exist in law, I would prefer the second view of the section. Not only is this more consonant with the normal construction given to limitation provisions, such as s 158. It is also more appropriate in this case because of the closing words of s 158(1) which envisage that, in certain limited circumstances, the exemption provided by the subsection will not apply. It is also a construction which fits more comfortably with the former provisions of s 158(2) which impose a time limit for the commencement of "such suit or action as aforesaid". That former provision lends colour to the meaning of s 158(1) at the time it was enacted. These were protective provisions, plainly derived from the formula used in the Lunacy Act 1898, s 172, to provide defences to a suit brought against a minister or public official. Upon this view, they do not go to the jurisdiction of the court hearing the suit or action. They are addressed not to the Registry clerk receiving the initiating proceedings but, ultimately, to the judge making the final orders disposing of the suit or action."

The same view was expressed by Priestley JA at 552.5. McHugh JA decided the matter on a basis that did not require consideration of this aspect of s 158(1). Section 158(1) was materially different in form and effect to s 31(1) as the former contained a qualification on its operation. However, of some significance, for present purposes, is that Kirby P viewed one possible meaning of the expression as being a prohibition on the commencement of proceedings.

A similar provision was considered in Canada more recently. In Newfoundland (Board of Commissioners of Public Utilities) v MacDonald (1991) 49 Admin LR 48. The Newfoundland Court of Appeal had to consider s 34A(5) of Motor Carrier Act 1992 RSN 1970 which provided that, in relation to certain office holders "no action or other proceeding lies against (them) for anything done ... in good faith ...". An application had been made to strike out proceedings against office holders to which s 34A(5) applied. As to the operation of that section Gushue JA said in the leading judgment:

"Various counsel for the appellants have argued that s. 34A-(5) places the onus on a plaintiff to establish at least a prima facie case of bad faith before the action may be permitted to stand. They say this has not been done and so the action is in effect void ab initio.

That submission should be dealt with first. The appellants say that because s.34A.-(5) states that "No action ... lies ...", this means that no action may be brought in these circumstances. However, various dictionaries define "lie" as utilized in a legal sense as also meaning "maintained" or "sustained". When one takes this with the second operative portion of the section, i.e., "for anything done or purporting to be done in good faith", which proposition could only be established by the actors themselves, they must establish that they are entitled to avail of that statutory immunity from suit. It is a shield to be used in certain circumstances which only they can prove exists." (emphasis added)

Again the view taken of the meaning of the expression "no action ... lies" was influenced by the qualification concerning good faith. However the discussion by Gushue JA indicates that his Honour accepts that the expression might mean that no action can be brought but that was not its meaning in the section under consideration. The observations of Gushue JA raise another matter that should be disposed of shortly though it does not directly arise in these proceedings

If "lies" in s 31(1) could mean either "can be brought", or alternatively can be "maintained" in the sense of "pursue" and "continue to pursue", then there could be little doubt that it would not mean the latter as it related to actions on foot on 15 March 1995, in the absence of a clear legislative indication it had that meaning. Provisions that might be viewed as bringing to an end proceedings on foot at the time of their enactment have been construed as not applying to proceedings which had been commenced prior to the time the legislation came into force: see Moon v Durden [1848] EngR 285; (1848) 154 ER 389: "no suit shall be brought or maintained"; Smithies v National Union of Operative Plasterers [1909] 1 KB 310: "an action ... shall not be entertained by any court"; Beadling v Goll [1922] 39 TLR 128: "no action shall be entertained ..."

To this point I have been discussing the meaning of the expression "no action, suit or other proceedings ... lies". In my opinion, it means that a person is precluded from bringing an action, suit or other proceeding and it would operate with this effect, having regard only to the language used in the prefatory words of s 31(1), from the date of commencement of the section, that is, 15 March 1995. However it must be accepted that while procedural in character, s 31(1) construed this way affects vested rights adversely in the way described by Dixon CJ in Maxwell v Murphy (supra). As earlier noted, this is conceded by the State. Thus the critical question is whether its operation with this effect is qualified in any respect having regard both to the presumption discussed in Maxwell v Murphy (supra) and the remainder of s 31(1) and the 1994 NSW Act more generally.

Of some significance, in my opinion, is the repeated reference in s 31(1) to the conduct of the NRA. There are direct references to the conduct of the NRA in s 31(1)(c),(d),(e),(f) and (g). There is an indirect reference to the conduct of the NRA in s 31(1)(a) because "an approved active constituent" is, by operation of s 3 of the Agvet Code which defines "approval" and "active constituent" and s 19 of the Agvet Code which deals with the manner of approval, an active constituent approved by the NRA. Similarly there is also an indirect reference to the conduct of the NRA in s 31(1)(b) because "registered chemical product" is, by operation of s 3 of the Agvet Code which defines "registered chemical product" and s 20 of the Agvet Code which deals with the manner in which a chemical product is registered, a chemical product registered by the NRA.

The NRA was established in 1992 by the Agricultural and Veterinary Chemicals (Administration) Act (Cth) and came into existence on 15 June 1993. It had no function under New South Wales law until the enactment of the 1994 NSW Act even though, under a Commonwealth law, the NRA had before then and by agreement with the State, played a role in New South Wales. Thus the operation of s 31 must be viewed in the context of the NRA only performing a function conferred directly by New South Wales law after 15 March 1995. The section was designed to preclude action against the State arising from the conduct of the NRA. This feature of s 31 suggests that the section would apply only to future facts or events because conduct of the NRA authorised by New South Wales law which would found the action, suit or other proceeding upon which s 31 was intended to operate, would be conduct engaged in after the 1994 NSW Act commenced to operate. If this is so, s 31 could only operate on causes of action arising after 15 March 1995.

It is necessary, however, to mention s 174 of the Agvet Code which is relied on by the State. It provides:

"(1) If, immediately before the commencement of the Agvet Code of this jurisdiction, a chemical product was registered by the previous registering authority of this jurisdiction and a label in relation to, or in relation to containers for, that product was also registered or approved by the authority, the following paragraphs apply:

(a) the product is taken to have been registered by the NRA under section 20 of the Code upon that commencement subject to the conditions (if any) to which its registration by that previous registering authority was subject;

(b) the person who applied for the registration of the product by the previous registering authority or, if that registration was renewed, the person who applied for the renewal or the last renewal, as the case may be, is taken to be the person who applied for the registration of the product under that Code;

(c) the label is taken to have been approved in relation to the product by the NRA under section 21 of that Code upon that commencement:

(i) for the containers for which it was registered or approved by that previous registering authority or, if it was not registered or approved for containers, for all containers for the product; and

(ii) subject to the conditions (if any) to which its registration or approval by the previous registering authority was subject.

(2) If:

(a) immediately before the commencement of the Agvet Code of this jurisdiction, the supply of a chemical product that was not registered by the previous registering authority of this jurisdiction was permitted in this jurisdiction, either unconditionally or subject to conditions, because the product was registered by the previous registering authority of another jurisdiction; and

(b) a label for containers for the product becomes approved under that Code;

the following paragraphs apply:

(c) if the supply of the product was permitted unconditionally - the product is taken to be registered by the NRA under section 20 of that Code when the label becomes approved;

(d) if its supply was permitted subject to conditions - the product is taken to be so registered subject to those conditions;

(e) the person who applied for the registration of the product by the previous registering authority of the other jurisdiction or, if that registration was renewed, the person who applied for the renewal or the last renewal, as the case may be, is taken to be the person who applied for the registration of the product under that Code.

(3) If, immediately before the commencement of the Agvet Code of this jurisdiction:

(a) a chemical product was registered by the previous registering authority of this jurisdiction; but

(b) it was unlawful under the law of this jurisdiction to supply the product;

the product is taken for the purposes of this section not to have been so registered immediately before that commencement."

However s 174, in my opinion, simply operates to confer a status on a chemical product: see s 174(1)(a), and (2)(c) and (d), and (3); a person: s 174(1)(b) and (2)(e); or a label: s 174(1)(c). Section 174 does not directly deem or treat the conduct of the previous registering authority to be the conduct of the NRA and it can only be viewed as doing so indirectly or obliquely. The same can be said of s 172 and s 176 which are broadly to the same effect as s 174.

In my opinion, the repeated reference to the conduct of the NRA in s 31(1) provides a clear indication that the sub-section's operation was, for reasons just explained, limited to causes of action arising after the commencement of the 1994 NSW Act because it was only from that point that the NRA would perform a function under New South Wales law. Resort to presumptions are unnecessary as the section itself indicates, in my opinion, that its operation is prospective in relevant respects.

Indeed this view of the purpose of s 31(1) and the time it was intended to operate is reinforced by the perpetuation of s 76 of the Pesticides Act 1978 (NSW). It has not been repealed. That Act was the legislation under and by reference to which pesticides were registered prior to the enactment of the 1994 NSW Act though, at that time, the NRA played a role in their evaluation. Section 76 provided:

"76. No proceedings lie against the Minister or a person appointed or employed under section 7 for or on account of any act, matter or thing done or ordered or directed to be done by the Minister or person, and purporting to be done for the purposes of carrying out the provisions of this Act, if the Minister or person, as the case may be, has acted in good faith and with reasonable care."

Persons appointed under s 7 included the Registrar of Pesticides whose functions under that Act included registering pesticides and labels and approving containers. Thus, prior to 15 March 1995 there existed a law providing a qualified immunity from suit for the person responsible, under prevailing New South Wales law, for the registration of pesticides. Section 174 operated on registration by the Registrar of Pesticides. It is unlikely that s 31, when read with s 174 and related sections, was also intended to confer an immunity for the same act or conduct which was in different terms.

Wilcox J correctly concluded s 31 did not preclude the bringing or prosecution of the principal proceedings against the State. I would dismiss the appeal with costs.

I certify that the preceding eighteen (18) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Moore.

Associate:

Alexandra George

Dated: 28 February 1997

Counsel and Solicitors K. Mason QC, Solicitor-General for NSW,

for appellant: and P.R. Garling.SC instructed by Lynn Boyd

Counsel and Solicitors R J. Ellicott QC and J.E. Rowe instructed

for respondents: by Peter Long & Co.

Dates of hearing: 29 November 1996

Date Judgment delivered: 28 February 1997