Tunnock v Victoria [1951] HCA 55; (1951) 84 CLR 42 (8 October 1951)

HIGH COURT OF AUSTRALIA

TUNNOCK v. THE STATE OF VICTORIA [1951] HCA 55; (1951) 84 CLR 42

Constitutional Law

High Court of Australia
Dixon(1), McTiernan(2), Williams(3), Webb(3) and Kitto(4) JJ.

CATCHWORDS

Constitutional Law - Land - Compulsory acquisition - Soldier settlement - Joint Commonwealth and State scheme - Invalidity of Commonwealth Act - Operation of State Act - War Service Land Settlement Agreements Act 1945 (No. 52 of 1945), s. 3 (1) - Soldier Settlement Acts 1945-1949 (Vict.) (No. 5107 of 1945 - No. 5438 of 1949), ss. 22, 27, 28, 41 (b).

HEARING

Sydney, 1951, July 16.
Melbourne, 1951, October 8. 8:10:1951
DEMURRER

DECISION

October 8.
The following written judgments were delivered: -
DIXON J. I have not been able to understand how in point of principle the As reliance was placed by the plaintiffs upon the decision of the Court in P. J. Magennis Pty. Ltd. v. The Commonwealth [1949] HCA 66; (1949) 80 CLR 382 , a decision in which I was unable to agree, it is satisfactory to find that no member of the Court considers that either as a result of that decision or otherwise the plaintiffs are able to make out any title to relief. (at p48)

2. In my opinion the demurrer should be allowed and the suit dismissed with costs. (at p49)

MCTIERNAN J. In my opinion the demurrer should be allowed. (at p49)

2. The foundation of the Court's jurisdiction to entertain this action is that there is a matter arising under the Constitution or involving its interpretation, Judiciary Act 1903-1950, s. 30. The matter is the question of the validity of the War Service Land Settlement Agreement 1945. The Court has already decided that this Agreement is void (P. J. Magennis Pty. Ltd. v. The Commonwealth [1949] HCA 66; (1949) 80 CLR 382 ). (at p49)

3. In the present case the defendants have not argued that Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 was wrongly decided; but they have demurred to the statement of claim, at the same time accepting the position that the Agreement is void, as the Court decided in that case. In order to support the demurrer they draw distinctions between the purpose of the acquisition which was the subject of Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 and the purpose for which the acquisition in the present case was made; also, between the legislative powers which would have been available to make the acquisition of the land of the plaintiff in that case, and the legislative powers under which the acquisition in the present case was made. (at p49)

4. In Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 the plaintiff alleged in the statement of claim that the Executive Government of New South Wales, in pursuance of s. 4 of the Closer Settlement Acts of the State, published a proclamation notifying that the Government of New South Wales proposed to consider the advisableness of acquiring certain land of the plaintiff "for the purpose of closer settlement". The plaintiff further alleged in the statement of claim that what the government of New South Wales threatened and intended by the proclamation was the acquisition of the land "for the purposes of the Agreement", namely, the War Service Land Settlement Agreement. The case was a demurrer and this allegation was assumed in the argument to be correct. The Court decided that the Agreement was void and that neither the Commonwealth nor the State of New South Wales had any constitutional power to ratify it or to make provision for the execution or performance of the Agreement. It may be observed that the Government of New South Wales had power under the Closer Settlement Acts of the State to resume land for closer settlement, the purpose mentioned in the Proclamation, and under this power it could, doubtless resume land in order to settle any person in the class for whose benefit the Agreement had been made. The Court decided that as the Agreement was null and void the Government of New South Wales could not lawfully apply the powers which it had under the Closer Settlement Acts of the State to resume any land for the purpose of the Agreement. It followed, so it was decided, that the Government of New South Wales could not lawfully proceed to make the resumption which the Proclamation indicated that it was about to contemplate. (at p50)

5. In the present case it is necessary to consider a set of legislative provisions which are substantially different from the Closer Settlement Acts of New South Wales. The present plaintiffs complain of an acquisition made by the Government of Victoria. The defendants say that the acquisition is authorized by the powers conferred upon that Government by the Soldier Settlement Act 1945, as amended, of Victoria. The amending Acts were passed in 1946 and 1949. Section 27 of the principal Act confers power upon the Governor in Council to acquire compulsorily any land which the Soldier Settlement Commission, a body constituted under the Act, has recommended for acquisition "for the purpose of Soldier Settlement pursuant to the Act or any amendment thereof". Section 22 gives power to the Commission to recommend land to the Governor in Council for acquisition for that purpose. The principal Act ratified the execution of the War Service Land Settlement Agreement by the Executive Government of the State and approved of the Agreement. The Soldier Settlement Acts, however, do not merely provide for carrying out the Agreement or acquiring land for the purposes of the Agreement. It is equally true that the Closer Settlement Acts of New South Wales were not passed to provide for either of those purposes. The bases of the decision in Magennis' Case (1949) [1949] HCA 66; 80 CLR 382 is that the Government of New South Wales applied the Closer Settlement Acts to effectuate the purposes of the Agreement. They were passed to make provisions for the broad purpose of closer settlement within the State; the Victorian Soldier Settlement Acts provide for carrying out the more special but analogous purpose of soldier settlement upon the lands of that State. It has been shown that this special purpose is "soldier-settlement" pursuant to the Acts themselves. The references in the Acts to the War Service Land Settlement Agreement make the terms of the Agreement relevant to the construction of the Acts and qualify the purposes for which the Government may exercise its statutory powers of taking land. The Acts, however, embody a scheme of "soldier-settlement" which is the creation of the State legislature. It has not merely adopted the scheme embodied in the Agreement. The Soldier Settlement Acts authorize the compulsory acquisition of land only for the purpose of "soldier-settlement" pursuant to these Acts. The validity of these powers of acquisition is not affected by the invalidity of the War Service Land Settlement Agreement. In the present case the Government of Victoria exercised these powers in order to acquire the plaintiffs' land and the Government acquired the land for the purposes of "soldier-settlement" pursuant to these Acts. In Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 the Government of New South Wales intended, according to the allegations in the statement of claim, to resume land for the purposes of the Agreement and not for closer settlement pursuant to the Closer Settlement Acts of New South Wales. There is a substantial distinction between the purpose of the acquisition in the present case and the accepted purpose of the threatened acquisition in Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 . The purpose in the present case is lawful and clearly within the constitutional powers of the State of Victoria. The purpose in Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 was, according to the decision in the case, unlawful, beyond the constitutional powers of the State of New South Wales and outside the ambit of the Closer Settlement Acts of that State. In my opinion it is not possible to invalidate the acquisition of the plaintiffs' lands by applying Magennis' Case (1949) 80 CLR 382 . Apart from that decision, the validity of the acquisition could not be in doubt. (at p51)

WILLIAMS AND WEBB JJ. This is a demurrer to a statement of claim in an action brought by the executors of Francis Hay deceased, who died on 6th June 1948, seeking declarations (1) that the Soldier Settlement Acts 1945-1949 (Vict.) are, or alternatively that the Soldier Settlement Act 1945 (No. 5107) is, inoperative and of no effect; (2) that the agreement made between the Commonwealth of Australia and the State of Victoria set forth in the First Schedule to the Commonwealth War Service Land Settlement Agreements Act 1945 and the Schedule to the Soldier Settlement Act 1945 (No. 5107) is void and inoperative; (3) that the purported compulsory acquisition by the defendant Commission on behalf of the State of Victoria of the land referred to in the statement of claim is void and of no effect; and consequential injunctions. The grounds of the demurrer to the statement of claim are (1) that it discloses no cause of action against the defendants or any of them; (2) that the Soldier Settlement Acts of the State of Victoria are valid and effective exercises of the legislative powers of the State of Victoria and that each of these Acts is operative and of full force and effect within the State of Victoria; (3) that the above agreement is valid; (4) that even if this agreement is invalid the Soldier Settlement Acts are not thereby rendered invalid or inoperative or of no effect, but are valid and operative and effective notwithstanding that fact; and (5) that upon their proper construction the Soldier Settlement Acts authorized the compulsory acquisition by the defendant Commission on behalf of the State of Victoria of the land referred to in the statement of claim and such compulsory acquisition was validly effected under these Acts. (at p52)

2. The deceased in his lifetime owned 363 acres of land in the Parish of Katunga, County of Moira, in the State of Victoria, on which he carried on a farming business and this business has been continued by his executors since his death. On 23rd November 1945 the State of Victoria entered into an agreement with the Commonwealth of Australia subject to approval by the State with a view to the settlement on land in the State of discharged members of the Forces and other eligible persons. The form of the agreement is set out in the First Schedule to the War Service Land Settlement Agreement Act 1945 of the Commonwealth of Australia and in the Schedule to the Soldier Settlement Act 1945 (No. 5107) of the State of Victoria. The entering into an agreement in the same form between the Commonwealth and the State of New South Wales was held to be beyond the constitutional powers of the Commonwealth in P. J. Magennis Pty. Ltd. v. The Commonwealth [1949] HCA 66; (1949) 80 CLR 382 . The Victorian Acts known as the Soldier Settlement Acts of the State of Victoria passed subsequently to the agreement of 23rd November 1945 are the Soldier Settlement Act 1945 (No. 5107), the Soldier Settlement (Amendment) Act 1946 (No. 5133) to be read and construed as one with Act No. 5107, the Soldier Settlement Act 1946 (No. 5179) to be read and construed as one with the two previous Acts, the Soldier Settlement Act 1949 (No. 5370) to be read and construed as one with the three previous Acts, and the Soldier Settlement (Amendment) Act 1949 (No. 5438) to be read and construed as one with the four previous Acts. By a preliminary notice of acquisition, notified in the Victoria Government Gazette of 18th January 1950, it was directed that the 363 acres should be compulsorily acquired for the purposes of the Soldier Settlement Acts. The last of these Acts, No. 5438, was not then in force. It came into force on 8th February 1950. A second preliminary notice of compulsory acquisition of the 363 acres was then notified in the Gazette of 22nd February 1950 and this notice was followed by a final notice of compulsory acquisition published in the Gazette on 11th October 1950. (at p53)

3. The attack on the validity of the acquisition is based on the reasoning of the majority of this Court in Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 . It was contended that the same considerations which led the majority to hold not only that the War Service Land Settlement Agreements Act 1945 of the Commonwealth so far as it authorized the execution of the agreement contained in the First Schedule to that Act was invalid, but also that the War Service Land Settlement Agreement Act 1945 (N.S.W.) and the proviso to s. 4 (4) (b) of the Closer Settlement (Amendment) Act 1907 introduced by the War Service Land Settlement and Closer Settlement (Amendment) Act 1945 and amended by the War Service Land Settlement and Closer Settlement (Amendment) Act 1948 were inoperative, must lead in the present case to the conclusion that the Victorian Soldier Settlement Acts are also inoperative. The principal Act is No. 5107. It is divided into five Parts. Part I provides for the ratification and approval of the agreement in question; Part II provides for the incorporation of the Soldier Settlement Commission; Part III provides for financial matters; Part IV provides for the powers and functions of the Commission, comprising Div. 1 - Acquisition and Setting Apart of Land, and Div. 2 - Settlement of and Advances to Discharged Soldiers; and Part V provides for the making of regulations. It follows from Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 that Part I of the Act must be inoperative because there was no valid agreement between the Commonwealth and the State of Victoria which the Victorian Parliament could ratify and approve. But what of the four other Parts? The reasoning in Magennis' Case [1949] HCA 66; (1949) 80 CLR 382 throws no light upon the effectiveness of these Parts of the Act. In that case the War Service Land Settlement Agreement Act 1945 (N.S.W.) was held to be inoperative because all that it did was to approve and ratify the agreement made on 28th November 1945 between the Commonwealth and the State of New South Wales. But that was an agreement into which the Commonwealth could not validly enter, so that there was no agreement which could be approved and ratified and the Act was ineffective. The proviso to s. 4 (4) (b) of the Closer Settlement (Amendment) Act 1907 amended as already mentioned provided that where any resumption was made for the purposes of the scheme approved and ratified by the War Service Land Settlement Agreement Act 1945 the value of the land should not exceed its value on 10th February 1942. It was held that this proviso was also inoperative because it dealt with a resumption for the purpose of the scheme and that purpose failed because the agreement was invalid. As there was no agreement, the War Service Land Settlement Agreement Act 1945 approved and ratified nothing, and there could not be any resumption under the Closer Settlement (Amendment) Act to which the proviso could apply. The War Service Land Settlement Agreement Act 1945 and the proviso were valid exercises of legislative power by the New South Wales Parliament, but the enactments failed because they had in law no operation whatsoever. (at p54)

4. It was contended for the plaintiffs that the Soldier Settlement Acts of Victoria also fail because their operation is entirely dependent upon the validity of the agreement of 23rd November 1945 and the invalidity of section 3 (1) of the Commonwealth War Service Land Settlement Agreements Act 1945 destroys the effective operation of the Victorian legislation. This contention requires a short examination of the Victorian Acts. Act No. 5107 was no doubt mainly enacted to carry out the joint Commonwealth and State scheme embodied in the agreement for the settlement of discharged soldiers and other eligible persons on Victorian land. The preamble states that it is an Act to ratify the execution for and on behalf of the State of Victoria of an agreement between the said State and the Commonwealth of Australia in relation to Soldier Settlement and to approve the agreement so executed. But the operation of the Act was not confined to this purpose. The preamble also states that it is an Act to constitute a Soldier Settlement Commission and confer certain powers and functions upon the Commission, and for other purposes. Part II of the Act contains ss. 5 to 16. Section 5 (1) provides that "For the purposes of this Act there shall be a Commission, appointed by the Governor in Council and constituted as hereinafter provided, to be called the 'Soldier Settlement Commission'". Part III contains ss. 17 to 21. Section 17 (1) provides that "For the purposes of this Act the Governor in Council - (a) may from time to time increase the amount of stock known as the Victorian Government Stock erected under the authority of the Victorian Government Stock Act 1896 by an additional amount not exceeding in the whole Fifteen million pounds;" (increased to 25,000,000 pounds by s. 4 of Act No. 5370). This Part provides for the application of this amount in the acquisition &c., of land acquired or set apart pursuant to this Act or the Land Settlement (Acquisition) Act 1943 (Vict.). The introductory words in Parts II and III "For the Purposes of this Act" are quite inapt to make the operation of these parts dependent upon the validity of the agreement. If that had been the intention of the Victorian Parliament the words would have been "For the purposes of the agreement". The State of Victoria did not promise in the agreement to enact these Parts. They are an independent exercise of the constitutional legislative powers of the Victorian Parliament. (at p55)

5. Part IV of the Act contains the provisions for the acquisition and setting apart of land pursuant to which the defendant Commission has purported compulsorily to acquire the plaintiffs' land. Section 22 provides that for the purposes of soldier settlement pursuant to this Act or any amendment thereof - (a) the Commission, with the approval of the Minister, may recommend to the Governor in Council that any Crown land should be set apart for those purposes; and (b) the Commission, with the approval of the Minister may (i) direct any of its inspectors, &c., to enter and inspect and report on any land which, in the opinion of the Commission, may be suitable for such purposes; and recommend to the Governor in Council that any land should be acquired for such purposes. Section 24 provides that "if the Governor in Council approves any such recommendation (a) under paragraph (a) of section twenty-two of this Act - the Governor in Council may direct the Minister to cause such land to be set apart accordingly; (b) under paragraph (b) of section twenty-two of this Act - the Governor in Council may direct the Commission to negotiate for the acquisition of such land accordingly." Section 27 (1) provides that "Where it appears to the Governor in Council that any land proposed to be acquired for the purposes of this Act cannot be acquired by agreement or cannot be so acquired at a reasonable price the Governor in Council may direct that such land be acquired compulsorily." Section 28, as amended by s. 2 of Act No. 5438, provides that upon publication of the preliminary notice of compulsory acquisition every person who has any estate or interest in respect of the land described in the notice shall have a claim for compensation and that upon publication of the final notice by virtue of this Act and without any further or other conveyance or transfer the land described in the final notice shall be vested in the Crown for the purposes of this Act and deemed to be unalienated land of the Crown. Sections 30 to 36 provide for the assessment of compensation by agreement or by action. Section 36 (2), as amended by s. 3 of Act No. 5438, provides that in the determination of compensation the value of the land shall be taken to be such amount as a bona-fide purchaser who proposed to use the land for the same purpose as that for which it was being used at the date of publication of the preliminary notice of compulsory acquisition might reasonably have been expected to offer for the land at that date. (at p56)

6. Clause 11 of the agreement provides that the State shall (a) set apart or resume, as the case might be, for settlement such land comprised in an approved plan of settlement as is Crown land; and (b) acquire compulsorily or by agreement and at a value not exceeding that ruling on 10th February 1942, private land or lands held under lease from the Crown comprised in an approved plan of settlement. The agreement, therefore, provides for the State of Victoria making both Crown lands and private lands available for the purposes of the agreement. But the power conferred by s. 24 is not confined to setting apart or resuming Crown land which is comprised in an approved plan of settlement, and the power to acquire private land was not in February 1950 a power to acquire the land at a value not exceeding that ruling on 10th February 1942, but to acquire the land at the value already mentioned. This shows that the Victorian Parliament did not intend the operation of the power of acquisition contained in Part IV of the Soldier Settlement Acts to be mere machinery for carrying out the agreement. (at p56)

7. No sound argument can be advanced to show that the operation of Act No. 5107 in its original form was intended to be dependent upon the validity of the agreement. Section 3 of this Act does no doubt provide that the agreement means the agreement a copy of which is set out in the Schedule to this Act, and that "discharged soldier" means any person who is an "eligible person" within the meaning of the agreement. But the agreement exists in fact if not in law and this is at most a referential definition of what is meant by a "discharged soldier" for the purposes of the Act. The same may be said of the reference to the assistance period referred to in the agreement contained in ss. 27 and 82 of Act No. 5179. Successive amendments of the Act have destroyed any shadow of such an argument if it ever existed. The references to the agreement in sections 25 and 41 (1) (b) of Act 5107 have been eliminated and the reference to the values ruling on 10th February 1942 in s. 36 (2) (b) has also been eliminated. That basis of valuation has now been superseded by a more just basis. Section 28 (1) of Act 5179 contained a reference to the factors referred to in sub-cl. 5 of cl. 6 of the agreement. But this reference has also been eliminated. Section 75 (a) of Act 5179, which previously imposed upon the Commission the duty of giving effect subject to the provisions of the Soldier Settlement Acts to the agreement, has now been recast in a more general form. An examination of the amendments indicates a definite intention on the part of the Victorian Parliament to make the operation of its Soldier Settlement Acts self-contained and quite independent of the validity of the agreement. There are some provisions of the Acts which still remain so closely linked with the agreement that its invalidity may affect their particular operation, see, for instance, ss. 13 (2) (a) (ii) and 20 of Act 5179. But, even if these provisions are ineffective, they cannot affect the validity of other portions of the Acts and, in particular, they cannot affect the validity of the provisions relating to the acquisition of the plaintiffs' land. Section 27 of Act 5107 authorizes the Governor-General to acquire land compulsorily for the purposes of the Act, not for the purposes of the agreement, and the preliminary and final notices of compulsory acquisition of the plaintiffs' land are notices that the land is acquired for the purposes of the Soldier Settlement Acts. (at p57)

8. For these reasons the demurrer should be allowed. (at p57)

KITTO J. In my opinion there is no substance in the plaintiffs' contention that the statutory provisions of the State of Victoria upon which the defendants rely are inoperative. The reasoning of the majority of the Court in P. J. Magennis Pty. Ltd. v. The Commonwealth [1949] HCA 66; (1949) 80 CLR 382 , plainly does not warrant the contrary view. That case, so far as it related to State legislation, was a decision on the construction of particular provisions which were markedly different from those now in question. I am unable to see in the allegations contained in the statement of claim any ground for denying the validity of the compulsory acquisition of the plaintiffs' land by the defendant Commission. (at p57)

2. In my opinion the demurrer should be allowed and the action dismissed. (at p57)

ORDER

Demurrer allowed. Suit dismissed with costs.