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High Court of Australia |
MAGUIRE v. SIMPSON [1977] HCA 63; (1977) 139 CLR 362
Constitutional Law (Cth)
High Court of Australia
Barwick C.J.(1), Gibbs(2), Stephen(3), Mason(4), Jacobs(5) and Murphy(6) JJ.
CATCHWORDS
Constitutional Law (Cth) - Federal jurisdiction - Suit to which Commonwealth a party - Limitation of actions - Commonwealth statute requiring rights of Commonwealth to be as nearly as possible the same as in a suit between subject and subject - Whether substantive rights affected - State statute of limitations - Whether Commonwealth suit statute-barred - The Constitution (63 & 64 Vict. c. 12), ss. 75 (iii), 78 - Judiciary Act 1903 (Cth), s. 64 - Limitation Act, 1969 (N.S.W.) ss. 14 (1) (a), 63.
HEARING
Sydney, 1976, August 3-5; 1977, December 5. 5:12:1977DECISION
1977, Dec. 5.2. In proceedings in the Supreme Court of New South Wales under the Trustee Act, 1925 (N.S.W.), as amended, to determine claims against a fund in court, the Bank claimed to participate as an unsecured creditor notwithstanding that more than six years has passed since its debt became due. Its claim was contested on the footing that its cause of action for the debt was statute barred by virtue of s. 14 (1) (a) of the Limitation Act, 1969 (N.S.W.) ("the Limitation Act"). That section provides that an action for such a cause as that asserted by the Bank is not maintainable if action therefor is brought after the expiration of six years from the date of the accrual of the cause of action. (at p368)
3. Section 63 (1) of the Limitation Act purports to extinguish such a cause of action for which proceedings are not commenced within the limitation period. However, having regard to the views I am about to express, I find no need to examine the question whether this provision can competently apply to the Bank's cause of action. To bar suit in the courts of the State is one thing: to extinguish the cause of action altogether is a matter of a different kind. (at p368)
4. The Bank's assertion of its immunity from the provisions of s. 14 (1) (a)
of the Limitation Act involved a question inter se
of the constitutional
powers of the Commonwealth and State. Consequently, the proceedings in
relation
to the administration of
the fund were removed into this Court
pursuant to s. 40A of the Judiciary Act 1903-1973 ("the Judiciary Act").
Thereafter, the
following question was referred under s. 18 of the Judiciary
Act for argument before a Full Court:
"Would ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.) be
applicable in an action commenced in the Supreme Court of New South Wales by
the Commonwealth Trading Bank of Australia
in which it sought to recover the
balance of a current account said to be owed to it by a customer -
(a) either of their own force, or
(b) by virtue of the Judiciary Act?" (at p368)
5. The answer to the question turns, in my opinion, upon the true
construction of Pt IX of the Judiciary Act, and in particular
of s. 64. Apart
from the provision of this Part, it would be difficult, in my opinion, to
conclude that a State could legislate
directly
to bind the Commonwealth in any
of its manifestations or emanations. However that might be, I have come to the
conclusion
for reasons
which I proceed to express that by dint of s. 64 of the
Judiciary Act the provisions of s. 14 (1) of the Limitation
Act could be
successfully pleaded against the Bank were it to sue in a New South Wales
court for the recovery of the debt due to
it.
(at p369)
6. The jurisdiction of the State court to entertain and decide upon the action of the Bank to recover its debt is federal jurisdiction, for the reason that the Bank, regarded as suing on behalf of the Commonwealth, is the plaintiff. Consequently, the appropriate law to govern the rights of the parties must be derived directly or indirectly from the Commonwealth, that is to say, from the Parliament as the principal source of federal law. (at p369)
7. The Judiciary Act is the relevant legislation and, of that Act, Pts IX and XI in particular relate to the present question. Consequently, as I have said, the answer to the question posed for the Full Court will be found in the proper construction of those provisions. Of these, s. 64 is submitted to be the source of the authority of a State court to apply s. 14 (1) (a) of the Limitation Act to a suit by the Bank to recover a debt due to it. (at p369)
8. Section 64 is placed in Pt IX amongst sections which, generally speaking, are concerned with procedure. Section 56, either alone or in combination with s. 64, has been regarded as submitting the Commonwealth to liability, e.g. in tort, and as not merely indicating the courts in which suits against the Commonwealth may be brought. By parity of reasoning, ss. 57 and 58 ought similarly to be regarded, though they have not been the subject in that respect of judicial decision. But ss. 60, 61, 62 and 63 do relate only to procedure. The same may be said of ss. 65, 66 and 67. (at p369)
9. The proper ambit of s. 64 has not heretofore been the subject of a decision of this Court. Various Justices have expressed views on the operation of s. 64 in cases in which its meaning and scope were not necessary for the decision of the case in hand. These views are diverse and inconclusive. I have no need to canvass them as, in my opinion, they afford little assistance in the resolution of the question presently before the Court. The references to them may be found in pars 169-178 in the section "High Court and Federal Judiciary" in vol. 14 of the Australian Digest, 2nd ed. (at p369)
10. If the Court's task in this case were merely to construe s. 64 without regard to historical considerations peculiar to the relationship of the Crown and the citizen in Australia, I should feel the greatest difficulty in concluding that the words in which s. 64 is expressed were apt to do more than specify matters of procedure in the conduct and manner of carrying on a suit to which the Commonwealth or a State was a party: and I would feel that difficulty notwithstanding the operation given by the decisions of this Court to s. 56. That section and ss. 57, 58 and 59 in terms provide for the initiation of suits by or against the Commonwealth or by or against a State. Sections 61 and 62 specify the formality of such suits; s. 63 provides for the service of process; ss. 65, 66 and 67 for the manner of executing the result of any such suit. Thus, s. 64 might well be considered as doing no more than regulate the conduct of such a suit, dealing with the procedural rights of the litigants throughout the suit and the form in which the result of the suit might be expressed. The provisions of Div. 2 of Pt XI of the Judiciary Act, and in particular s. 79, would, in my opinion, tend to confirm such a conclusion, providing as they do for the substantive law to be applied in the exercise of federal jurisdiction. (at p370)
11. However, the Court is not able, in my opinion, simply to construe the relevant words of the Judiciary Act as if enacted in a vacuum. The Judiciary Act was passed in 1903 when the Commonwealth, but lately established, was engaged in providing for the law to be administered and the procedures to be followed by courts exercising federal jurisdiction. This involved the Commonwealth in providing - to borrow from the preamble to 20 Vict. No. 15, the Claims Against the Government Act of 1857 (N.S.W.) - for the settlement of "disputes and differences (which might) . . . arise between the subjects of Her Majesty the Queen" (though inapt in the new reign) and the Commonwealth. (at p370)
12. The Constitution by s. 78 gave to the Parliament power to "make laws conferring rights to proceed against the Commonwealth or a State in respect of matters within the limits of the judicial power". This power was not confined, in my opinion, to the making of procedural laws which did not create substantive rights. A right "to proceed in respect of any matters within the judicial power of the Commonwealth" in the Constitution cannot, in my opinion, be construed as no more than enabling the provision of a right of access to the courts to enforce some claim or demand which by some other law, including the common law, was a valid cause of action against the Crown. In my opinion, the Parliament was authorized by s. 78 to make a law giving the subject a substantive right against the Commonwealth in respect of any matter within the judicial competence of the Commonwealth. (at p371)
13. Section 75 of the Constitution had created federal jurisdiction to entertain a matter in which the Commonwealth was a party. Thus, the jurisdiction to entertain a claim by a citizen against the Commonwealth existed apart from any law made under s. 78. The mere procedural aspects of that jurisdiction did not, in my opinion, depend upon the existence of any law made by virtue of s. 78. This consideration, in my opinion, fortifies, if it were necessary, the view that laws made under s. 78 could confer substantive rights. (at p371)
14. But, more importantly I think, the ambit of the power given by s. 78 of the Constitution and the meaning of s. 64 of the Judiciary Act must be determined in the light of the tradition already established by 1900 in the Australian colonies with respect to the liability of the Crown to be sued and to suffer judgment in respect of any cause of action for which a citizen in like circumstance was liable. (at p371)
15. The New South Wales Act of 1857, from whose preamble I earlier borrowed a phrase, recognized that by reason of the necessity for the executive government to undertake many things which in England were not done by government at all, greater facility should be provided for recovery from the Crown for injury done to the citizen by the servants of the Crown. Consequently, that Act prescribed machinery for the enforcement through the courts of claims of the citizen against the colonial government. But between the citizen and access to the courts that statute placed the discretion of the Governor in Council not to refer the claim to the courts. There was a further possible impediment to the citizen's access to the courts for the determination of his claim, for it was provided by that Act that, if the Governor in Council was of opinion that the subject matter of the citizen's claim affected the Royal prerogative, it was necessary to obtain Her Majesty's approval for the reference of the claim to the courts. (at p371)
16. It is important to observe that apart from the reference to the Imperial prerogative, no limitation was placed by the Act of 1857 upon the nature of the citizen's claim which could be referred by the colonial executive to the Supreme Court. Thus, the Governor in Council could refer a claim, founded on an act of the "government", which if done by a citizen would be tortious in nature. (at p371)
17. The procedures prescribed by the Act of 1857 were ameliorated by the enactment in 1861 of "An Act for the Amendment of the Law as to Claims against the Crown" (24 Vict. No. 27) without any limitation as to the nature of the claim against the government which might have been made the subject of the proceedings. (at p372)
18. It is interesting to observe in passing the distinction made in the Act of 1857 between the prerogative of the Imperial Crown and the liability of the colonial government. The concept of an indivisible Crown operating in right of different self-governing communities had not then fully developed. But the concept was emerging in the distinction made in the provisions of the Act of 1861. (at p372)
19. In 1876 the legislature of New South Wales enacted 39 Vict. No. 38, "An Act to enforce Claims against the Colonial Government . . .". The Act, reserved for Royal assent, which it subsequently received, repealed both of the prior Acts. In terms it extended to "any just claim or demand whatever against" the colonial government. It provided for the appointment of a nominal defendant by the colonial executive but ensured that in default of any such appointment, the colonial treasurer should be the nominal defendant (s. 2). The citizen was given the right to sue such defendant "at law or in equity in any competent Court and every case shall be commenced in the same way and the proceedings and rights of the parties therein shall as nearly as possible be the same and judgment and costs shall follow . . . as in an ordinary case between subject and subject" (s. 3). In any such action "all necessary judgments may be given and made", including certain kinds of relief specifically nominated lest the generality of the words I have quoted might be thought to be insufficient to embrace them (see s. 5). (at p372)
20. Thus the discretion of the colonial executive and that of the Imperial executive which the Act of 1857 placed in the way of the citizen were removed. The exception as to claims of the citizen which might affect the Imperial prerogative was not repeated. (at p372)
21. The Supreme Court of New South Wales in Bowman v. Farnell (1886) 7 NSWLR 1 gave full effect to the breadth of the language in which ss. 2, 3 and 5 of the Act of 1876 were couched. The citizen by virtue of them could sue the government of the colony upon any cause of action. The rights of the parties to which s. 3 referred were substantive and not merely procedural rights. (at p372)
22. The Privy Council in Farnell v. Bowman (1887) 12 App Cas 643 affirmed this decision, recognizing "that the local Governments in the Colonies, as pioneers of improvements, are frequently obliged to embark in undertakings which in other countries are left to private enterprise, such, for instance as the construction of railways, canals and other works for the construction of which it is necessary to employ many inferior officers and workmen. If therefore", said their Lordships, "the maxim that 'the king can do no wrong' were applied to Colonial Governments in the way now contended for by the appellants, it would work much greater hardship than is done in England" (1887) 12 App Cas, at p 649 . The Privy Council gave to the words of the Act of 1876 their plain meaning. (at p373)
23. The situation thus brought about by statute and judicial decision had become almost universal throughout the Australian colonies by 1900. It was in the climate of this situation that Pt IX of the Judiciary Act, including s. 64, was enacted. Although more direct language could have been used to ensure that substantive rights akin to those between subject and subject were being erected, the draftsman was understandably content to use language of somewhat the same order as that employed in the Act of 1876 which had received judicial construction. Of course, the entire collocation of the provisions of that Act could not, in my opinion, have properly been thought to be of a mere procedural nature: whereas, as I have said, the terms of s. 64 in the setting of so many procedural provisions in Pt IX of the Judiciary Act, viewed apart from the historical background, might have been so regarded. (at p373)
24. Because of that background, I have reached the conclusion that it is proper to regard s. 64 as expressing the intention of the Parliament to subject the Crown in right of the Commonwealth as nearly as possible to the same liability as would obtain in the like circumstances as between subject and subject. Although, as I have said, s. 64 is found in association with procedural provisions, it should be given a like construction to that given to the provisions of the Act of 1876 in the cases to which I have referred. This means, in my opinion, that the subject may set up s. 14 (1) of the Limitation Act against the Bank in a proceeding by it to recover the debt it claims to be due. (at p373)
25. Accordingly, I would answer the question referred to the Full Court as follows: (a) Unnecessary to answer. (b) Yes, as to s. 14 (1) (a) of the Limitation Act: unnecessary to answer, as to s. 63 of the Limitation Act. (at p373)
GIBBS J. In the course of proceedings brought in the Supreme Court of New
South Wales for the determination of claims against
a fund that had been paid
into court to be dealt with under Pt IV of the Trustee Act, 1925 (N.S.W.), as
amended, the question arose whether a claim by the Commonwealth Trading Bank
of Australia ("the Bank"), as an unsecured
creditor, had become barred by the
lapse of time. In relation to this question counsel for the Bank submitted to
the Supreme Court
that the relevant statute of limitations, the Limitation
Act, 1969 (N.S.W.) ("the Limitation Act"), does not bind the Crown in right
of
the Commonwealth, and that the Bank, for this purpose, stands in the position
of the Crown. This submission depended (as will
be seen) on the premise that
the legislature of New South Wales had no power to render the Act binding on
the Commonwealth, and
accordingly raised an inter se question, with the result
that the matter was removed into this Court by virtue of s. 40A of the
Judiciary Act. The Chief Justice thereupon directed that the following
question be argued before a Full Court:
"Would ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.) be
applicable in an action commenced in the Supreme Court of New South Wales by
the Commonwealth Trading Bank of Australia
in which it sought to recover the
balance of a current account said to be owed to it by a customer -
(a) either of its own force, or
(b) by virtue of the Judiciary Act?" (at p374)
2. The section of the Limitation Act which, if applicable, would bar the
remedy of the Bank is s. 14 (1) which provides, inter
alia, as follows:
"An action on any of the following causes of action is not maintainable
if brought after the expiration of a limitation period
of six years running
from the date on which the cause of action first accrues to the plaintiff or
to a person through whom he claims
-
(a) a cause of action founded on contract (including quasi contract) not
being a cause of action founded on a deed;
. . ."Section 54 provides in effect for the extension of the limitation period where within that period the cause of action has been confirmed by acknowledgment or payment, but no question of confirmation falls for our consideration in the present case. If the remedy is barred by s. 14 the right itself is extinguished by s. 63 (1) which provides as follows:
3. The cause of action claimed by the Bank is of the kind to which these
provisions refer. Section 10 (1) of the Limitation Act
provides, subject to
immaterial exceptions, that the Act binds the Crown, and s. 10 (2) declares
that "For the purposes of this
Act an action by an officer of the Crown as
such or a person acting on behalf of the Crown is an action by the Crown".
Section
11 (1) provides that unless the context or subject matter otherwise
indicates or requires, "'Crown' includes not only the Crown
in right of New
South Wales but also, so far as the legislative power of Parliament permits,
the Crown in all its other capacities".
These provisions clearly reveal an
intention that the Act shall bind the Crown in right of the Commonwealth, and
persons acting
in its behalf, if the power of the New South Wales legislature
permits it to do so. The Bank can therefore only succeed in its claim
if it
establishes first, that the legislature of New South Wales has no power to
pass a limitation statute which binds the Crown
in right of the Commonwealth,
or, to put it in another way, which binds the Commonwealth, and, secondly,
that the Bank is entitled
to the immunity of the Crown in right of the
Commonwealth in this respect. But even if both of these propositions were
accepted
as correct, the further question would remain whether the provisions
of the Limitation Act are rendered applicable in the present
proceedings, not
of their own force, but by virtue of the provisions of the Judiciary Act. If
that question is answered in the
affirmative the Bank must fail and the other,
more fundamental, questions will not need to
be decided. I would therefore
turn first
to consider the effect of the Judiciary Act, upon the assumptions
that the Limitation Act does not of its own force bind the Commonwealth
and
that the Bank is an agent of the Crown in right of the Commonwealth and as
such is entitled to the prerogatives and immunities
of the Crown. (at p375)
4. By s. 79 of the Judiciary Act it is provided as follows:
"The laws of each State, including the laws relating to procedure,
evidence, and the competency of witnesses, shall, except
as otherwise provided
by the Constitution or the laws of the Commonwealth, be binding on all Courts
exercising federal jurisdiction in that State in all cases to which they
are
applicable."
The Supreme Court was exercising federal jurisdiction in the present case. It
was decided in Inglis v. Commonwealth Trading Bank
of Australia (1969) 119 CLR
334 that the Bank, when sued in legal proceedings, is "the Commonwealth or a
person . . . being sued
on behalf of the Commonwealth" within s. 75 (iii.) of
the Constitution, so that the High Court has original jurisdiction in such
proceedings, and the effect of s. 39 of the Judiciary Act is to invest
the
Supreme Court with federal jurisdiction in such a matter. The Supreme Court
was therefore required by s. 79 to apply the laws
of New South Wales, in so
far as they were applicable, in determining the questions in issue. However,
s. 79 "does not purport
to do more than pick up State laws with their meaning
unchanged": Pedersen v. Young [1964] HCA 28; (1964) 110 CLR 162, at p 165
; and see
Commissioner
of Stamp Duties (N.S.W.) v. Owens (No. 2) [1953] HCA 62; (1953) 88 CLR 168, at p
170 . It was pointed out
in John Robertson & Co. Ltd. v. Ferguson
Transformers
Pty. Ltd. [1973] HCA 21; (1973) 129 CLR 65 that there is an exception
to the generality of
that statement; a State law may be rendered
applicable by s. 79 to a court
exercising federal jurisdiction,
which is not a State court, notwithstanding
that the law according
to its own terms
is limited in its application to the
courts
of the State. The actual question which arose in that case, and upon
which the Court
was divided in opinion - whether a State statute
of
limitations was rendered applicable by s. 79 to an action which
was given by a
Commonwealth Act and which could only be brought
in the High Court - does not
here concern us.
But the four Justices
who considered the effect of s. 79 in
that case were, I consider,
all in agreement that, subject to an exception
of
the kind mentioned,
s. 79 does not enable a court exercising federal
jurisdiction
to give an altered meaning to a State statute
which it is
required
to apply (1973) 129 CLR, at pp 80-81, 83, 88, 94-95 . Section
79
therefore has nothing to say on the question
whether a State statute
which is
to be applied by a court exercising federal jurisdiction
becomes binding on
the Commonwealth.
In the present case if the
Limitation Act does not of its
own force bind the Bank, s. 79 does
not give its provisions an extended
operation which would render
them binding
upon the Bank. (at p376)
5. However, s. 64 of the Judiciary Act provides as follows:
"In any suit to which the Commonwealth or a State is a party, the rights
of parties shall as nearly as possible be the same,
and judgment may be given
and costs awarded on either side, as in a suit between subject and subject."
The words of this section, naturally construed, appear to have the effect that
if the Commonwealth is a party to proceedings its
rights, and the rights of
all other parties to the proceedings, will be governed by any statute of
limitations that would be applicable
if both parties were subjects. In the
present proceedings a subject in the position of the Bank would have no rights
against the
fund, because of the provisions of s. 14 (1) (a) and s. 63 of the
Limitation Act. The other parties to the proceedings would, if
the adverse
claimant in the position of the Bank were a subject, have rights to
the fund
free from the claims of that adverse claimant.
Unless some restriction should
be placed upon the apparently plain meaning
of the words of s. 64 their effect
is that in any suit
to which the Commonwealth is a party the litigants on both
sides shall as nearly as possible have
the same rights as if both were
subjects. In the present case this would bring about the result that the
rights of the Bank on
the one hand and those of the other
parties to the
proceedings on the other hand will as nearly as possible be the same as if the
Bank were in the position of an ordinary
subject. The qualification introduced
by the words "as nearly as possible" creates no
difficulty; it is quite
possible to apply
a statute of limitations to the Commonwealth and such a
statute can readily be applied
to the Bank. Indeed the provisions of a statute
of limitations may as appropriately be applied to a trading bank as to any
other
party. The effect of s. 64, stated more directly,
is that the Limitation
Act, which is to be applied in the proceedings by virtue of s. 79, is rendered
applicable
to the Commonwealth
as though it were a subject, and therefore
binds the Bank. The Limitation Act is so applied by force of Commonwealth law,
and not
by its own force as a State law. It may be accepted that because s. 63
of the Limitation Act extinguishes the right of the person
whose claim is
statute barred, the relevant provisions of that statute cannot be regarded as
merely procedural. But s. 64 is not
in terms limited to rights of a procedural
kind and no reason exists to imply a limitation of that kind in a remedial
provision
expressed in the broad terms of s. 64. (at p377)
6. It is true that some judges have thought that the only rights referred to
by s. 64 are rights of a purely procedural kind:
The Commonwealth v. Baume,
per O'Connor J. [1905] HCA 11; (1905) 2 CLR 405, at p 418 ; Griffin v. South Australia, per
Isaacs
A.C.J. [1924] HCA 40; (1924) 35
CLR 200, at p 204 . In the former of those cases
O'Connor J. expressed the view (1905) 2 CLR, at
pp 417-418 that the
Commonwealth
Parliament derives its power to legislate with respect to suits
by and against the Commonwealth
from s. 78 of the Constitution, and that
"There is no power given by the section of the Constitution (s. 78) to affect
any right of the Commonwealth outside procedure". In The Commonwealth v.
Anderson [1960] HCA 85; (1960) 105 CLR 303,
at pp 317-318 ,
Menzies J. also expressed a doubt
as to whether s. 64 would be a valid provision if it extended to substantive
rights as well as to rights of procedure. There is, however, no decision
of
this Court either that s. 64 does not extend to substantive rights or that it
would be beyond constitutional power if it did so extend. The question whether
s. 64 does extend to substantive rights has been treated in a number of cases
as an open one: see Asiatic Steam Navigation Co. Ltd. v.
The Commonwealth
(1956) 96 CLR 397, at p 417 ; South Australia v. The Commonwealth (1962) 108
CLR 130, at p 140
and see also
Washington
v. The Commonwealth (1939) 39 SR
(NSW) 133, at p 142 . On the other hand there are decisions which support
the
view
that s. 64 governs substantive rights. In Baume v. The Commonwealth
[1906] HCA 92; (1906) 4 CLR 97 it was held that a subject has the same
rights of action
against the Commonwealth as he would have against a subject
in matters of tort
as well as contract. This right
was rested upon
ss. 56 and 64 of the Judiciary
Act. Griffith C.J. (with whom Barton J. concurred) said that he could not
distinguish between the section of the
New South Wales statute considered in
Farnell v. Bowman (1887) 12 App Cas 643 and the provisions of ss. 56 and 64
(1906) 4 CLR,
at p 110 . O'Connor J., notwithstanding the views he had
expressed in The Commonwealth v. Baume (1905) 2 CLR, at p 418 a year earlier,
also considered that s. 56 and s. 64 rendered the Commonwealth liable in tort
(1906) 4 CLR, at p 118 and apparently did not see
any constitutional objection
to the validity of sections having that effect. He added that the statute
considered in Farnell v.
Bowman was "in much the same language" as s. 64 (his
reference to s. 54 (1906) 4 CLR, at p 119 appears to have been a typographical
error). The New South Wales statute considered in Farnell v. Bowman provided
that "the proceedings and rights of parties . . .
shallas nearly as possible
be the same, and judgment and costs shall follow . . . as in an ordinary case
between subject and subject",
and the Judicial Committee said that these words
should not be given a meaning other than their ordinary literal meaning (1887)
12 App Cas, at p 650 . For reasons which I gave in Downs v. Williams (1971)
[1971] HCA 45; 126 CLR 61, at pp 96-97 , I consider
that their Lordships
regarded those words
as not limited to rights of a procedural kind. Another
decision consonant with
the view
that s. 64 is not
limited to matters of procedure is Pitcher v.
Federal Capital Commission
[1928] HCA 44; (1928) 41 CLR 385 where
it was held that the
plaintiff
was entitled to maintain against the Federal Capital Commission an
action
under the Compensation to Relatives Act, 1897 (N.S.W.) (which in
substance reproduced Lord Campbell's Act) for compensation for the death of
his wife caused by the negligence
of the Commission. The Court held that ss.
56 and 64 of the Judiciary Act rendered the provisions of the Compensation to
Relatives
Act, which was applied to the Territory by the Seat of Government
Act
1909 and the Seat of Government (Administration) Act 1910,
binding on the
Commonwealth and therefore on the Commission. It was there argued that the
Compensation to Relatives Act, being
an Act of the legislature of New South
Wales, was not and could not be binding on the Commonwealth and that when that
Act
was by
federal legislation made applicable to the Federal Capital
Territory it must be given the same meaning in the Territory as
it had
in New
South Wales and consequently must be construed as not being binding in the
Territory on the Commonwealth or on the
Commission.
As to this argument, Knox
C.J. and Powers J. said (1928) 41 CLR, at p 390 :
"This argument leaves out of consideration two matters of importance,
namely, (1) that by sec. 4 of the Federal Act No. 25
of 1910 the Act in
question is to 'have the effect in the Territory as if it were a law of the
Territory,' and (2) that the provisions
of secs. 56 and 64 of the Federal
Judiciary Act 1903-1920 relating to claims against the Commonwealth - an Act
which was in force
in the Territory immediately before its surrender and
acceptance - are in substance not distinguishable from the provisions of the
New South Wales Act on which Farnell v. Bowman was decided."
See also per Higgins J. (1928) 41 CLR, at pp 391, 393 . Gavan Duffy and Starke
JJ. said (1928) 41 CLR, at pp 395-396 :
"And these sections" (ss. 56 and 64) "have been construed by this Court
as giving to a subject the same rights of action
against the Commonwealth as
he would have had against a subject in an action of tort as well as of
contract (Baume v. Commonwealth
[1906] HCA 92; (1906) 4 CLR 97 ); see also Farnell v. Bowman
(1887) 12 App Cas 643 . The result is that the Commonwealth comes
exactly
within
the category of those made liable by the provisions of the Compensation
to Relatives Act 1897 . . . If those provisions
are applied
to the
Commonwealth they do not deprive the Crown of any prerogative or right
peculiar to it but merely subject it,
along with
all others guilty of a
wrongful act, neglect or default, to a new form of action for the benefit of
the relatives of
the deceased
where it would already have been liable in an
action by and for the benefit of the deceased had he not died."
With regard to the statement by Gavan Duffy and Starke JJ. that the
Commonwealth would already have been liable in an action by
and for the
benefit of the deceased had he not died, it may be remarked that such
liability was itself created by the Judiciary
Act - see Baume v. The
Commonwealth. Their Honours' reference to a prerogative or right peculiar to
the Crown may have been intended
to suggest that in some cases, because of the
special position of the Crown, it may not be possible exactly to equate the
rights
of the Crown to those of a party who is a subject - a situation for
which the words "as nearly as possible" in s. 64 may have been
intended to
provide. (at p380)
7. Two other cases in which the liability of the Commonwealth, when sued in
tort, was held to be governed by State statutes which
were not of a procedural
kind were Parker v. The Commonwealth [1965] HCA 12; (1965) 112 CLR 295 and Suehle v. The
Commonwealth
[1967] HCA 13; (1967) 116 CLR
353 - both decisions of Windeyer J. in original
jurisdiction. In the former case the plaintiff was
held to have
a right of
action
against the Commonwealth because of the effect of two Victorian
statutes, which respectively re-enacted
the substance
of Lord Campbell's
Act
and abolished the doctrine of common employment, but Windeyer J. did not make
it entirely
clear by what
process those statutes
came to apply to the
Commonwealth, and he did not discuss s. 64. The statute which abolished
the
doctrine
of common employment
was later in date than the Judiciary Act. In
Suehle v. The Commonwealth, in a discussion which
was obiter because of the
decision
reached on the facts, Windeyer J., having
expressed the opinion that
the law to be applied was
that of South Australia (this aspect
of the decision
does not concern us),
went on to say that the statutory modification of the
common law allowing for apportionment
of damages in cases of contributory
negligence would have been applicable if the facts of
the case had called for
its application.
Apparently s. 64 played some part in leading him to this
conclusion for he said (1967)
116 CLR, at pp 356-357 :
"I say this because, notwithstanding what Jordon C.J. said in Washington
v. The Commonwealth (1939) 39 SR (NSW) 133 , the
references in the Judiciary
Act to the laws of the States (e.g. in s. 64) are now regarded as having an
ambulatory effect. They
are not tied to State law as it was in 1903." (at
p380)
8. It cannot be regarded as doubtful, in the light of these decisions, that
the liability of the Commonwealth, when sued in tort,
is governed by the
relevant statutes of the State whose law is to be applied, notwithstanding
that those statutes do not bind the
Commonwealth of their own force. However,
the members of the Court who decided those cases have been disposed to treat
s. 56, as
well as s. 64, as contributing to that result. When the Commonwealth
was sued in tort it was unnecessary to decide whether the application
of the
statutes of a State was effected by ss. 56 and 64 in conjunction or by s. 64
alone, but in the present case the question
becomes crucial, for s. 56
obviously can have no relevant operation. In my opinion it was s. 64, unaided
by s. 56, that rendered
the Commonwealth subject to the State legislation
considered in those cases. Section 56 provides that "A person making a claim
against the Commonwealth, whether in contract or in tort, may in respect of
the claim bring a suit against the Commonwealth" in
the courts mentioned in
the section. There is not a word in the section that suggests that State laws
which of their own force
do not bind the Commonwealth should, in respect of
such claims, be applied in a modified form so as to render them binding upon
the Commonwealth. Moreover, it seems unlikely to have been intended to
assimilate the rights of the Commonwealth to those of a
subject when it is
sued in tort or in contract but not to effect a similar assimilation in any
other case. Perhaps it was natural
for the members of the Court to refer to
ss. 56 and 64 together because some of the words of both those sections
appeared in the
legislation considered in Farnell v. Bowman (1887) 12 App Cas
643 , and because they were concerned only with cases of tort, but
in my
opinion the provisions of s. 56 are quite inapt to render a State statute
applicable to the Commonwealth. Properly understood
these decisions must in my
opinion rest on s. 64. (at p381)
9. This view derives the strongest support from the decision in Asiatic Steam
Navigation Co. Ltd. v. The Commonwealth [1955]
HCA
67; (1956) 96
CLR 397 . There a suit was
brought by the Commonwealth to limit its liability, under s. 503 of the
Merchant
Shipping
Act, 1894
(Imp.), for loss or damage which occurred as a
result of a collision between a Commonwealth ship and another
vessel. Section
741
of that statute provided that the Act should not, except where specially
provided, apply to ships belonging
to Her Majesty.
The
Court held,
notwithstanding that provision, that the Commonwealth was entitled to limit
its liability. The
majority of the
Court
based their decision on two quite
distinct grounds. One ground, with which we are not concerned, depended
on s.
80 of the
Merchant
Shipping Act, 1906 (Imp.). But the majority held that quite
independently of that section the substance
of s. 503 was incorporated
as part
of the law governing the tortious liability of the Commonwealth in respect of
its ships. Dixon
C.J. and McTiernan and Williams
JJ. said (1956) 96 CLR, at pp
419-420 :
"On the whole the better view seems to be that s. 64 of the Judiciary
Act or, if not s. 64 itself, the law resulting from
ss. 56 and 64 of that Act
and ss. 75 (iii.) and 78 of the Constitution covers s. 503 as part of the
private law on the subject which it incorporates in the law applicable to the
liability of the Crown."
Kitto J. based his conclusion entirely on s. 64 (1956) 96 CLR, at pp 427-428 .
Fullagar J. dissented from this view, saying that in his opinion the effect of
s. 64 was not to make applicable either in favour of the Commonwealth or
against it a statute the express terms of which exclude the Crown
(1956) 96
CLR, at p 424 . (at p382)
10. Although the majority in that case left open the question whether s. 56
contributed to the result which they reached, in my opinion upon analysis it
must be concluded that that section could not have
had any application.
Section 56 refers to a suit brought against the Commonwealth in respect of a
claim in contract or tort. The proceedings in Asiatic Steam Navigation
Co.
Ltd. v. The Commonwealth were not brought against the Commonwealth - they were
brought by the Commonwealth. It seems to me
impossible to stretch the words of
s. 56 to apply to such a case. It must have been s. 64 which rendered s. 503
of the Merchant Shipping Act applicable to the Commonwealth. The true
position, in my respectful opinion,
was stated by Kitto J. (1956) 96 CLR, at p
427 :
"I also think that s. 64 of the Judiciary Act 1903-1950 (Cth) provides
an independent ground for reaching the same conclusion.
When one reads Farnell
v. Bowman (1887) 12 App Cas 643 and the New South Wales section which was
there construed by the Privy Council,
and then turns to s. 64 of the Judiciary
Act, the conclusion seems inevitable that the rights referred to in s. 64
include the
substantive rights to be given effect to in the suit. If that be
so, it follows that s. 64 must be interpreted as taking up and
enacting, as
the law to be applied in every suit to which the Commonwealth or a State is a
party, the whole body of the law, statutory
or not, by which the rights of the
parties would be governed if the Commonwealth or State were a subject instead
of being the Crown.
The portion of that law which is taken by s. 64 from
statutes, whether Imperial, Commonwealth or State, is then to be applied in
such suits by the independent force of that section; and if, in its original
setting any provision of that law was so expressed
as not to apply to the
Crown, s. 64 nevertheless explicitly makes it applicable, as completely as
possible, to the determination
of the rights of the Commonwealth or State
against its opponents and of their rights against the Commonwealth or State."
I would adopt this passage as a correct statement of the law. (at p383)
11. There are two authorities which might be thought to suggest that s. 64
has a narrower scope than I have attributed to it,
but they are both in my
opinion distinguishable from the present case. In The Commonwealth v. Anderson
[1960] HCA 85; (1960) 105
CLR 303 it was
held that the provisions of the Landlord and Tenant
(Amendment) Act, 1948-1958 (N.S.W.), which made courts
of petty
sessions the
only competent courts in ejectment proceedings, but which expressly provided
that the Act should not bind
the Commonwealth,
did
not prevent the Supreme
Court of New South Wales from entertaining an action in ejectment brought by
the
Commonwealth. The
Court
held that s. 64 did not have the effect of
applying those provisions to the suit brought by the Commonwealth.
The reason
for the
decision was expressed by Dixon C.J. as follows (1960) 105 CLR, at p
310 ):
"It may be conceded, at all events for the purposes of the argument,
that once you have a suit in the High Court or the Supreme
Court to which the
Commonwealth is a party, then for all purposes to which the words 'rights of
parties', on the true meaning of
the provision, extend, the law as between
subject and subject must so far as possible be taken to supply the rights of
the parties
notwithstanding that one is a government. It is perhaps not
unimportant to bear in mind that it is the rights of parties as in a
suit
between subject and subject, not the law, that are to apply as nearly as may
be. But in any case the essential condition of
the application of s. 64 is the
existence of the suit to which the Commonwealth is a party and as a result of
s. 39 (2) of the
Judiciary Act 1903-1959 that includes a suit in the Supreme
Court in which the Commonwealth is plaintiff. It is obvious therefore
that no
provision of State law which provides that such a suit shall not be brought in
the Supreme Court as between subject and
subject can be the source of such
rights."
Later he said (1960) 105 CLR, at p 311 :
"It is difficult, indeed it is impossible, to find in Pt III the
creation of definite rights between subject and subject
operating
independently of the authority of the competent courts, the petty sessions and
proclaimed tenancy courts. In other words
the provisions contained in Pt III
are not the source of definite rights between subject and subject capable of
appropriation under
s. 64 of the Judiciary Act to the purpose of determining
what are the rights between the Commonwealth and its tenants in a suit
in the
High Court or the Supreme
Court. Provisions of a State law of such a kind
denying general jurisdiction which would otherwise
exist over a subject matter
and committing the subject to a special tribunal armed with particular powers
and discretions in the
judicial administration of
State legislative
restrictions on common law rights cannot supply the rights between subjects to
be
applied pursuant to s. 64 in the actual exercise of the jurisdiction of the
Supreme Court and High Court invested by the Constitution or the Judiciary
Act. In the application of s. 64 of the Judiciary Act you begin with the
existence of the jurisdiction and of
the suit brought by or against the
Commonwealth of State."
All that this case decided is that a provision of a State law which prevents a
court from exercising jurisdiction in a suit of
a particular kind is not
applied by s. 64 because it is only when the court has jurisdiction that s. 64
can operate. The statement
by Dixon C.J. that "it is the rights of parties . .
. not the law, that are to apply" was described
by Windeyer J. in Downs v.
Williams [1971] HCA 45; (1976) 126 CLR 61, at p 83 as "somewhat cryptic and elliptical" and
it is in many cases difficult to see
the significance
of the
distinction which
Dixon C.J. drew, since if rights are applied the law which is their source can
for practical
purposes
be regarded
as equally applicable. However, Dixon C.J.
may have had in mind no more than the very situation with which
The
Commonwealth
v.
Anderson was concerned, i.e., a case in which the law which it
was sought to apply affected the jurisdiction
of the court and
not
the rights
of the parties in the court which was exercising jurisdiction. (at p384)
12. In Downs v. Williams [1971] HCA 45; (1976) 126 CLR 61 the Court was concerned not with s. 64 of the Judiciary Act but with s. 3 of the Claims against the Government and Crown Suits Act, 1912 (N.S.W.), a re-enactment of the statute considered in Farnell v. Bowman (1887) 12 App Cas 643 . Section 4 of that Act contains words similar to those of s. 64. The action was one against a nominal defendant appointed under s. 3 of the Act for damages allegedly resulting from breaches of the Factories, Shops and Industries Act, 1962 (N.S.W.). The majority of the Court held that the latter statute did not either expressly or by necessary implication bind the Crown. It was further held by McTiernan, Menzies and Owen JJ., with Windeyer J. and myself dissenting, that the Claims against the Government and Crown Suits Act does not impose a liability on the Crown for damage alleged to have been incurred as a result of a breach of a statutory duty if the statute alleged to impose the duty does not bind the Crown. This decision is distinguishable from the present case in two respects. In the first place the decision in Downs v. Williams involved the reconciliation of two statutes of a single legislature. The Court there had to consider whether the general provisions of a New South Wales statute passed in 1912 were intended to apply to the Crown the provisions of another New South Wales statute passed in 1962, upon the assumption that the latter provisions, properly construed, did not bind the Crown. This question was similar to that considered by the Judicial Committee in Nisbet Shipping Co. Ltd. v. The Queen (1955) 1 WLR 1031; (1955) 3 All ER 161 which was distinguished in Asiatic Steam Navigation Co. Ltd. v. The Commonwealth (1956) 96 CLR, at pp 418-419, 427-428 . Section 64 on the other hand does not require the court to reconcile different statutes of one legislature; in effect it renders applicable to the Commonwealth the statutes of another legislature which by hypothesis do not bind the Commonwealth. Secondly, Menzies J., one of the Justices forming the majority in Downs v. Williams, thought that the effect of a decision rendering the Crown liable in that case would be that upon the commencement of the action the Crown became subject to obligations which did not apply as between the plaintiff and the Crown at the time when the events giving rise to the so-called obligations occurred and that this cast doubt on the correctness of such a decision (1971) 126 CLR, at p 68 . Whether or not it was right to look at the matter in that way, no similar argument could be advanced against the validity of a decision that the rights of the Commonwealth are subject to the Limitation Act in the present case. (at p385)
13. Although Downs v. Williams [1971] HCA 45; (1971) 126 CLR 61 is distinguishable, I should
add, with the greatest respect,
that I am unable
to accept some of the
reasoning
of the majority in that case, at least if applied to s. 64.
McTiernan J., after
saying that "it
is the rights of the parties in the suit
in question, rather that the law, which are to apply
as nearly as may be
as if
between
subject and subject" (1971) 126 CLR, at p 65 , and citing The
Commonwealth v. Anderson (1960)
105 CLR, at p 310 went
on to say (1971)
126
CLR, at p 66 :
"In such a case as this therefore it is only after it has been
ascertained that a statutory duty is imposed on the Crown
that the rights
between the parties are determined by the general law applicable as between
subject and subject."
That conclusion does not, in my respectful opinion, follow from the
proposition for which The Commonwealth v. Anderson is cited.
Menzies J. said
(1971) 126 CLR, at p 69 that he recognized that s. 64 gave rise to different
problems from those raised by the
Claims against the Government and Crown
Suits Act, but added that he preferred
the statement of Fullagar J. in Asiatic
Steam Navigation
Co. Ltd. v. The Commonwealth (1956) 96 CLR, at p 424 to the
observations
of Kitto J. in that case. But the views expressed by Fullagar
J.
were contrary not only to those of Kitto J., but also to those
of the other
three members of the Court, and Fullagar J. failed
to observe the distinction,
which all the other members of the
Court noted, between Nisbet Shipping Co.
Ltd. v. The Queen (1955)
1 WLR 1031; (1955) 3 All ER 161 and a case arising
under s. 64.
Finally, in Downs v. Williams, Owen J. said (1971) 126 CLR, at pp
91-92 :
"In an action between subjects in which the plaintiff claimed damages
for a breach by the defendant of a statutory duty,
the defendant would be
entitled to raise the question whether he was a person to whom the statute in
question applied and I cannot
understand why, on the true construction of s.
4, the Crown cannot do the same."
His Honour concluded by saying that "the Crown is, by virtue of s. 4, entitled
to the rights which a subject would have if sued
for a breach of statutory
duty and that includes the right to deny that any obligation is imposed upon
it by the statute said to
have been breached" (1971) 126 CLR, at p 92 .
However, this statement, if true, would surely be equally true if the statute
sought
to be applied were one which gave a right of action for compensation
for the death of another, and yet it is established that a
statute of that
kind is rendered applicable by s. 64. (at p386)
14. The questions with which I have been dealing have been considered also in some decisions of the State Supreme Courts. It has been held in New South Wales by the Full Court of that State that in an action against the Government under the Claims against the Government Act, 1897 (N.S.W.) the defendant has the same right as a subject to plead the Statute of Limitations: De Rossi v. Walker (1902) 2 SR (NSW) 249 . That decision is in accord with the opinions that I have expressed. Similarly the actual decision of the Full Court in Washington v. The Commonwealth (1939) 39 SR (NSW) 133 , that an action lay against the Commonwealth under the Compensation to Relatives Act, 1897 (N.S.W.), was in my opinion correct, although I cannot agree with the suggestion there made (1939) 39 SR (NSW), at pp 142-143 that s. 56 of the Judiciary Act is sufficient to bring about this result, or that it was only the law in force when the Judiciary Act was passed that was applied. In The Commonwealth v. Lawrence (1960) 77 WN (NSW) 538; (1960) NSWR 312 Else-Mitchell J. reached a conclusion similar to that at which this Court arrived in The Commonwealth v. Anderson [1960] HCA 85; (1960) 105 CLR 303 , but for different reasons. In the course of his judgment, Else-Mitchell J. said that s. 64 did not make it possible, in an action in which the Commonwealth seeks to recover a debt, to disregard the fact that Crown debts of the Commonwealth are entitled to priority in virtue of the prerogative and are not subject to the statutes of limitation. He sought to explain this result by saying that "the transmutation of the rights of the Commonwealth or a State into those of a private litigant by s. 64 of the Judiciary Act is only 'as nearly as possible' and that it is consistent with such a transmutation that the character of the Crown or of Commonwealth or State in relation to the subject matter of debt, contract or property, cannot be ignored" (1960) 77 WN (NSW), at p 540; (1960) NSWR, at p 315 . If this theory were carried to its logical conclusion, it would seem to give s. 64 no effect, and I am unable to accept this wide view of the effect of the words "as nearly as possible". Else-Mitchell J. suggested that another possible explanation for the view that he espoused is that s. 64 applies only to procedural rules, but I have already indicated that I do not agree with that suggestion. His dictum that s. 64 does not subject the Commonwealth to the statutes of limitation was in my opinion erroneous. In Re Young's Horsham Garage Pty. Ltd. (1969) VR 977 Menhennitt J. held that the Commonwealth and the Deputy Commissioner of Taxation were not required to obtain the leave of the Supreme Court under s. 263 (2) of the Companies Act 1961 (Vict.) before suing a company in liquidation. The decision was based on the view that the State law was applied by s. 79 of the Judiciary Act with its meaning unchanged, and so did not apply to the Crown in right of the Commonwealth. As I have already said, I accept that view of the effect of s. 79. However, his Honour did not consider the effect of s. 64 and his decision can only be sustained if the section of the Companies Act there in question is regarded as denying jurisdiction to the Court so that the case comes within the principle of The Commonwealth v. Anderson [1960] HCA 85; (1960) 105 CLR 303 . Finally, in The Commonwealth v. Burns (1971) VR 825 , the Commonwealth sued to recover moneys mistakenly paid out of public revenue to a person not entitled to them. The defendant submitted that the Commonwealth was estopped from alleging that the payments were made without lawful authority. Newton J. applied the principle that "a party cannot be assumed by the doctrine of estoppel to have lawfully done that which the law says that he shall not do" (1971) VR, at p 830 . He said that this rule could apply as between subject and subject, and that s. 64 had no application. That statement would appear to be unexceptionable, but his Honour went on to say: "It was not suggested that s. 64 prevented the application of the principle in the Auckland Harbour Board Case (1924) AC 318 and, in my view, it does not do so: cf. South Australia v. Commonwealth (1962) [1962] HCA 10; 108 CLR 130, at p 140 per Dixon C.J." The principle of the Auckland Harbour Board Case is that any payment made out of the consolidated funds without parliamentary authority is illegal and ultra vires, and may be recovered by the Government if it can be traced. It is unnecessary for present purposes to discuss whether s. 64 would assimilate the rights of the Commonwealth to those of a subject in such a case. (at p388)
15. The conclusion that I have reached, as a matter of construction and on authority, that the rights referred to in s. 64 include substantive rights, does not mean that s. 64 has an operation which extends beyond constitutional power. Notwithstanding the doubts expressed by O'Connor and Menzies JJ., I consider that it is right to say, as was said by Dixon C.J. and McTiernan and Williams JJ. in Asiatic Steam Navigation Co. Ltd. v. The Commonwealth that "the Constitution . . . conferred the fullest power upon the Commonwealth Parliament with reference to the law governing the liability of the Crown in right of the Commonwealth" (1956) 96 CLR, at p 418 . It is unnecessary to discuss fully the source of this power. In so far as the Bank is concerned, if the Commonwealth has power to set up the Bank it has power to legislate with regard to its substantive rights and liabilities, and can do so by a general law such as s. 64 as well as by a particular law. (at p388)
16. Two questions remain to be considered. The first is whether it is material that the Limitation Act was passed subsequent to s. 64 of the Judiciary Act. It would be a most unsatisfactory result if s. 64 required the rights of the parties to a suit to which the Commonwealth was a party to be adjusted by reference to the law in force as between subject and subject at the time when the Judiciary Act was passed. By the date of the suit that law might have become outmoded and superseded. However, it is now settled that s. 64 has an ambulatory operation and is capable of including legislative changes made in State law after that section was enacted: Moore v. The Commonwealth [1958] HCA 53; (1958) 99 CLR 177, at p 182 ; Suehle v. The Commonwealth (1967) 116 CLR, at pp 356-357 ; Downs v. Williams (1960) 105 CLR, at p 100 ; see also Parker v. The Commonwealth [1965] HCA 12; (1965) 112 CLR 295 . (at p389)
17. The second question is whether it is any obstacle to the operation of s. 64 in the present case that the party to the proceedings is not the Commonwealth but the Bank. It was suggested in argument that s. 64 must be confined to cases in which the Commonwealth by that name is a party. This argument was supported by reference to ss. 63 and 66 of the Judiciary Act, which it was said were not intended to be applicable where the party to the suit is an instrumentality possessing the immunity of the Commonwealth, but not the Commonwealth itself. Section 63 provides (inter alia) that where the Commonwealth is a party to a suit, all process required to be served upon that party shall be served upon the Attorney-General or upon some person appointed by him to receive service, and s. 66 provides (inter alia) that on receipt of the certificate of a judgment against the Commonwealth the Treasurer shall satisfy the judgment out of moneys legally available. It was also said that s. 55E of the Judiciary Act shows that the word "Commonwealth" in that statute should be narrowly construed. That section provides that the Crown Solicitor may, in his official capacity, act as solicitor for a number of persons there described, including "the Commonwealth", and "a body established by an Act". In my opinion, however, the submission that s. 64 has such a limited effect is wrong in principle and contrary to authority. In Pitcher v. Federal Capital Commission [1928] HCA 44; (1928) 41 CLR 385 and in Naismith v. McGovern [1953] HCA 59; (1953) 90 CLR 336 the provisions of s. 64 were held applicable where the party to the suit was in one case the Federal Capital Commission and in the other the Commissioner of Taxation. Those cases establish that it is not necessary for the application of the section that the Commonwealth should sue or be sued in that name. It would be a surprising result if an agency could claim that it represented the Commonwealth but that its rights in the suit were not affected by s. 64, although if the Commonwealth itself was a party its rights would be governed by that section. However, s. 64 does not have the effect that an agency of the Commonwealth has a greater immunity than the Commonwealth itself. It is unnecessary to consider whether ss. 63 and 66 apply where the party to a suit is an agency of the Commonwealth, but it may be observed that in many cases the question whether those sections, if unaffected by subsequent legislation, would be so applicable will not arise, because the statute under which the agency in question is established may reveal, expressly or by implication, an intention that process shall be served, and a judgment satisfied, otherwise than in accordance with those sections. Section 55E in my opinion neither creates a difficulty nor is of any assistance in the construction of s. 64. (at p390)
18. For the reasons I have given I consider that the rights of the parties in the present proceedings are governed by the Limitation Act, even if that Act does not of its own force bind the Commonwealth and the Bank is entitled to the immunities of the Commonwealth. That result seems to me eminently just, for I must confess myself quite unable to find any valid reason why a body set up to carry on general banking business (see s. 28 of the Commonwealth Banks Act 1959 (Cth), as amended) should be immune from the ordinary laws that provide limitations of time for the enforcement of debts. (at p390)
19. On the view that I take it is unnecessary to decide whether the decision in The Commonwealth v. Cigamatic Pty. Ltd. [1962] HCA 40; (1962) 108 CLR 372 should be followed or whether the Bank is entitled to the relevant immunity of the Commonwealth and I would therefore express no opinion upon either of those matters. (at p390)
20. I would answer the question asked as follows: (a) Unnecessary to answer. (b) Yes. (at p390)
STEPHEN J. The reasons for judgment of Gibbs J., which I have had the advantage of reading, do, by their full reference to relevant legislation and to the facts and circumstances of this matter, relieve me of the need for any recitals. In my view the present proceedings may be disposed of upon a quite narrow ground, and to it I shall confine myself. (at p390)
2. For the Commonwealth Trading Bank of Australia to make good its claim to the moneys paid into Court by the plaintiff Maguire it must overcome the effect upon its claim of the Limitation Act, 1969 (N.S.W.); otherwise that claim must fail as statute-barred. (at p390)
3. The Bank's answer to the plea of the statute must be to claim for itself the like immunities as are possessed by the Crown in right of the Commonwealth and also to assert that those immunities would prevent a like claim by that Crown from becoming statute-barred. To test the latter assertion I make two assumptions in favour of the Bank: first, that its claim is to be treated in all relevant respects as if it were being made by the Crown in right of the Commonwealth - as to which see Inglis v. Commonwealth Trading Bank of Australia [1969] HCA 44; (1969) 119 CLR 334 ; secondly, that, to the extent to which the State legislature, by s. 11 (1) of the Limitation Act, has purported to apply that Act to the Crown in all its capacities, this will be ineffective so far as concerns the Crown in right of the Commonwealth. (at p391)
4. Upon these assumptions it can only be by virtue of some law of the Commonwealth that the Limitation Act will operate to defeat the Bank's claim and the question is whether s. 64 of the Judiciary Act 1903 is such a law. Its applicability in the proceedings in the Supreme Court of New South Wales in which the Bank is a claimant is not in doubt, the fact that the Commonwealth, in the person of the Bank, is a party to those proceedings suffices to invest that Court with federal jurisdiction: Constitution s. 75 (iii.) and Judiciary Act s. 39 (2). It also renders applicable s. 64 of the Judiciary Act: The Commonwealth v. Anderson [1960] HCA 85; (1960) 105 CLR 303, at p 309 , per Dixon C.J., with which aspect of his judgment McTiernan, Kitto and Windeyer JJ. expressed agreement. (at p391)
5. If, then, s. 64 of the Judiciary Act be applicable, what precisely is its effect and, in particular, does it enable the plaintiffs to invoke the Limitation Act so as to bar this claim by the Bank? A preliminary point may be disposed of at the outset. If the Bank is to be assumed to be the agent of the Commonwealth, so as to attract to itself the immunities of the Crown, it must also, I think, be taken to be affected by s. 64 in like manner as is the Commonwealth; in both Pitcher v. Federal Capital Commission [1928] HCA 44; (1928) 41 CLR 385 and Naismith v. McGovern [1953] HCA 59; (1953) 90 CLR 336 the section was applied in this way to parties which, not being the Commonwealth itself, were in no relevantly different position from that of the Bank. (at p391)
6. Section 64, then, requires that in the present proceedings in the Supreme Court "the rights of parties shall as nearly as possible be the same . . . as in a suit between subject and subject". Read literally this would mean that when the Bank makes its claim to this fund in Court its entitlement is to be determined as if it were an ordinary, subject litigant. To a subject as litigant the provisions of the Limitation Act will of course apply; why then should those provisions not apply in like manner to the Bank, at least so long as whatever is to be regarded as the content of the qualification "as nearly as possible" is not found to stand in the way? In my view the section does apply s. 14 (1) (a) of the Limitation Act in this quite straightforward way to the facts of the present case and the qualifying phrase of s. 64 never becomes operative. Section 64 of the Judiciary Act has long been regarded as involving considerable difficulties of interpretation; I am far from discounting those difficulties, but do not see them as arising on the facts of the present case. (at p392)
7. One of the aspects of s. 64 which has long occasioned difficulty and has led to a marked division of opinion in this Court is "whether s. 64 is limited to questions of procedure or extends to the substantive law governing the liability put in suit": Dixon J. in South Australia v. The Commonwealth (1962) 108 CLR, at p 340 . Perhaps the most emphatic expressions of the first view were those of O'Connor J. in The Commonwealth v. Baume [1905] HCA 11; (1905) 2 CLR 405, at p 418 and of Isaacs A.C.J. in Griffin v. South Australia [1924] HCA 40; (1924) 35 CLR 200, at p 204 . On the other hand s. 64 has been described as applying to the Crown "the whole body of the law, statutory or not, by which the rights of the parties would be governed if the Commonwealth or State were a subject instead of being the Crown": Kitto J. in Asiatic Steam Navigation Co. Ltd. v. The Commonwealth (1957) 96 CLR 397, at p 427 . In citing for the first view judgments much earlier in date than are the views of Kitto J., I am not to be taken as suggesting that his Honour's view represents modern orthodoxy; on the contrary, I regard the question as still unresolved. (at p392)
8. No occasion for choosing between these two views arises in the present case. Section 14 (1) of the Limitation Act is clearly only procedural in character and is all that need be invoked in order effectively to bar the Bank's claim to the fund in Court; accordingly, if s. 14 (1) (a) be applicable to that claim it is unnecessary to consider whether the substantive provisions of s. 63 of the Limitation Act may also be applied. Section 14 (1) (a) enacts that an action of the relevant sort brought after more than six years is not "maintainable". As was said as long ago as 1663 in Lee v. Rogers (1663) 1 Lev 110, at p 110 [1793] EngR 642; (83 ER 322, at p 323) a provision such as this is made "for the ease of those who would take advantage thereof"; it simply bars the remedy without abolishing the right: Isaacs J. in The Crown v. McNeil (1922) 31 CLR 76, at p 100 , and see per Kitto J. in Chang Jeeng v. Nuffield (Australia) Pty. Ltd. [1959] HCA 40; (1959) 101 CLR 629, at p 642 . With such a provision may be contrasted s. 63 of the Limitation Act, which is substantive in nature, providing for the extinguishment of right and title. The contrast is noted and discussed in the leading case of Huber v. Steiner (1835) 2 Bing (NC) 203, at p 210 (132 ER, at p 83) , per Tindal C.J., although the whole basis for this distinction has been the subject of critical examination by Professor Jackson in Melbourne University Law Review, vol. 7 (1970), pp. 407 and 449. (at p392)
9. In Downs v. Williams [1971] HCA 45; (1971) 126 CLR 61, at p 76 Windeyer J. pointed out that the question whether the Crown is bound by some Act of Parliament really asks no more than whether some particular enactment or enactments of that legislation so binds; the same is true of the effect of s. 64 of the Judiciary Act when it applies to the Crown provisions of the Limitation Act. Each section of the Limitation Act is to "have effect as a substantive enactment" - Interpretation Act of 1897 (N.S.W.), s. 11 - and of any particular section of the Limitation Act the question of the operation of s. 64 must be separately asked and answered. If the question be asked of s. 14 (1) (a), a provision procedural in character, the answer, on any view of the authorities, to some of which I have referred, must be that that section is made applicable to the Bank's claim and that will, without regard to the applicability or otherwise of s. 63 of the Limitation Act, be enough to dispose of the Bank's claim; the Bank's claim will be statute-barred and no need arises to consider whether the substantive provisions of s. 63 of the Limitation Act are also made applicable by virtue of s. 64 of the Judiciary Act. (at p393)
10. Quite apart from the debate whether s. 64 applies only to matters of procedure or extends also to substantive law there exists some uncertainty concerning the content of the qualifying phrase "as nearly as possible". In The Commonwealth v. Baume Griffith C.J. described it as meaning "as far as the provisions the aid of which is invoked are applicable to such a party as the Commonwealth" (1905) 2 CLR, at p 417 ; his Honour regarded as not so applicable a provision which required affidavits to be sworn by a party in person. O'Connor J. took a like view (1905) 2 CLR, at p 418 . However it was not only the fact that the Commonwealth was not a natural person, and hence incapable of swearing an affidavit, that the Chief Justice thought might bring into operation the qualification involved in "as nearly as possible"; any inconsistency with "the notion of a sovereign State" would have a like effect and the Chief Justice instanced process for contempt as something accordingly excluded from possible application to the Crown (1905) 2 CLR, at p 417 . In The Commonwealth v. Miller [1910] HCA 46; (1910) 10 CLR 742, at p 756 Isaacs J. gave to "as nearly as possible" the effect of excluding from application to the Crown "all coercive action incompatible with the dignity of the Crown and unwarranted by the express words of the enactment"; his Honour would thus have viewed this qualifying phrase as excluding from application to the Crown any provision inconsistent with its dignity. He regarded the furtherance of public justice, which is the concern of s. 64, as obliged to give way in face of "the still higher consideration of the general welfare" [1910] HCA 46; (1910) 10 CLR 742, at p 756 - and accordingly also regarded the qualifying phrase as preserving an adequate measure of Crown privilege in the discovery of documents. Higgins J. regarded s. 64 as not carrying the process of assimilation of Crown to subject so far, as to take away, in the case of orders for discovery, the "privilege of the Crown's officers as to affairs of State, etc." (1910) 10 CLR, at p 758 . In Marconi's Wireless Telegraph Co. Ltd. v. The Commonwealth (No. 2) (1913) 16 CLR 178 the Court was unanimous in concluding that Crown privilege against discovery was not abrogated by the effect of s. 64. The Chief Justice regarded a claim to privlege as examinable but if, on examination, it proved to be well founded the Crown might still take advantage of it (1913) 16 CLR, at p 186 . Barton J. appears to have taken a similar view; Isaacs J. took the opportunity of repeating what he had said in Miller's Case (1910) 10 CLR, at p 756 and of emphasizing that the privilege of public interest remained available to the Crown. (at p394)
11. More recent cases throw little further light upon the effect of the qualification, "as nearly as possible". In Asiatic Steam Navigation Co. Ltd. v. The Commonwealth (1956) 96 CLR 397 the joint judgment of Dixon C.J., McTiernan and Williams JJ. suggests that where "purposes or functions peculiar to Government" are in question, s. 64 may have but limited application (1956) 96 CLR, at p 417 - and see the reference to ships of war (1956) 96 CLR, at p 420 . On the other hand Kitto J. speaks (1956) 96 CLR, at p 427 of s. 64 as making the law as between subjects applicable "as completely as possible" to the Crown, any "special position of the Crown" being put out of account (1956) 96 CLR, at p 428 . This would appear to give a relatively narrow field of operation to the words "as nearly as possible". In South Australia v. The Commonwealth (1962) 108 CLR, at p 140 Dixon C.J. observed that the necessary difference between principles of private and public law had to be borne in mind in applying the law as between subject and subject to a cause concerning the rights and obligations of government. In Downs v. Williams (1971) 126 CLR, at p 103 Gibbs J. remarked that "not every statute which imposes a duty on a subject can be rendered applicable to the situation of the Crown". The observations of Owen J. (1971) 126 CLR, at pp 91-92 , if they are to be understood as concerned with the effect of "as nearly as possible", would seem to give that phrase a very wide operation and one which I find difficult to reconcile with that not inconsiderable number of cases in which the substantive law applicable to subjects has been applied to the Crown. To these references may be added what was said by Newton J. in The Commonwealth v. Burns (1971) VR, at p 830 in relation to the Chief Justice's observations in South Australia v. The Commonwealth [1962] HCA 10; (1962) 108 CLR 130 to which I have already referred and, in particular, to the judgment of Else-Mitchell J. in The Commonwealth v. Lawrence (1960) 77 WN (NSW) 538; (1960) NSWR 312 . In the latter case his Honour (1960) 77 WN (NSW), at p 540; (1960) NSWR, at p 315 provides instances of the possible operation of the phrase "as nearly as possible", instances which serve to emphasize the variety of cases to which the phrase may possibly have occasion to operate. (at p395)
12. Whatever may ultimately come to be regarded as involved in the qualification, "as nearly as possible", I see no good reason for treating the provisions of s. 14 (1) (a) of the Limitation Act as subject to it. The considerations which in past cases have been suggested as guides to the content of this qualification do not suggest that such a section falls within its terms; were it otherwise the operation of s. 64 would be diminished to an extent far greater than is justified by the words "as nearly as possible", whether understood either according to their ordinary meaning or in the somewhat extended sense suggested by observations such as those of Isaacs J. in The Commonwealth v. Miller (1910) 10 CLR, at p 756 . (at p395)
13. Without attempting any general analysis of the extent of the qualification involved in "as nearly as possible", I am content to conclude that it does not operate to exclude from the operation of s. 64 the provisions of s. 14 (1) (a) of the Limitation Act. (at p395)
14. The provisions of s. 64 antedate s. 14 of the Limitation Act by almost seventy years and were s. 64 to be regarded as applying only to laws then in force, as has sometimes been said to be the case, it would be necessary to look elsewhere than in the Limitation Act 1969 for some time bar possibly applicable in the present proceedings. However I prefer the view expressed by Windeyer J. in Suehle v. The Commonwealth [1967] HCA 13; (1967) 116 CLR 353 and adopted by Gibbs J. in Downs v. Williams (1971) 126 CLR, at p 100 , namely that, as befits a provision which undertakes the sort of task which s. 64 performs, it has an ambulatory operation, applying to the state of the law as it changes with time. (at p395)
15. Finally, I observe that the facts of the present case are such as to avoid particular problems which have in the past been thought to give rise to particular difficulty. The legislation which the plaintiff seeks to invoke, the Limitation Act, is an enactment which involves no verbal infelicity when applied to the Commonwealth Crown; this no doubt because it is legislation which is intended to apply to the Crown - see s. 11 (1), indeed it is intended to extend to the Crown in all capacities so far as legislative power permits. Again, situations such as that envisaged by Else-Mitchell J. in The Commonwealth v. Lawrence (1960) 77 WN (NSW), at p 541; (1960) NWSR, at p 316 , in which s. 64 might seem, in federal jurisdiction, to override as against a State the operation of later State laws expressly excluding the State from particular obligations or liabilities, are of no relevance to the present case. These and other possible applications of s. 64 which may be thought to give rise to difficulty should, I think, await circumstances which bring them before the Court. (at p396)
16. As has been remarked in the past, some of the possible effects of s. 64, both upon the Commonwealth and upon the States and in relation both to Commonwealth statutes and to those of a State, may prove both obscure and curious. This is, I think, good reason narrowly to confine the grounds of this judgment. It is even better reason for careful scrutiny by those concerned with law reform into the potentialities of the section with a view to its amendment, so that the already existing doubts as to its operation may be resolved and difficulties as yet to be encountered may be avoided. (at p396)
17. I answer the questions asked as follows: (a) unnecessary to answer; (b) as to s. 14 (1) (a) of the Limitation Act 1969 (N.S.W.), Yes; as to s. 63 of that Act, it is unnecessary to answer. (at p396)
MASON J. The question which we have to answer in this case concerns the possible application of ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.) to a claim made in the Supreme Court of New South Wales by the Commonwealth Trading Bank ("the Bank") to recover the balance of a current account said to be owing to it by a customer. The trustee of the Bank's customer paid into court under the provisions of the Trustee Act, 1925 (N.S.W.), as amended, a sum of money so that claims upon that fund by creditors might be judicially determined. The Bank made a claim against the fund on the footing that the customer was an unsecured creditor in respect of the amount of the debt. This claim was resisted on the ground that any action to recover the debt would be barred or extinguished by the statutory provisions to which I have referred. The issue is whether these provisions apply so as to bar or extinguish the Bank's claim. (at p396)
2. I put to one side the question whether the provisions of the State statute
could apply of their own force to a debt owing to
the Bank, for it is my
opinion that the provisions of the statute are picked up and made applicable
in any action that the Bank
could bring to recover the debt by s. 64 of the
Judiciary Act 1903, as amended. That section provides:
"In any suit to which the Commonwealth or a State is a party, the rights
of parties shall as nearly as possible be the same,
and judgment may be given
and costs awarded on either side, as in a suit between subject and subject."
(at p397)
3. It is ambulatory in its operation and will therefore make applicable the
terms of the relevant statute, whether Imperial, Commonwealth
or State, as
they are expressed from time to time (Moore v. The Commonwealth (1958) 99 CLR
177 ; Downs v. Williams (1971) 126 CLR,
at p 100 ). (at p397)
4. The first issue to be resolved is whether the Bank is comprehended by the
expression "the Commonwealth" within the meaning
of the section. Inglis v.
Commonwealth Trading Bank of Australia [1969] HCA 44; (1969) 119 CLR 334 decided that when an
action
is brought against
the Bank the action is one in which the Commonwealth
or a person
being sued on behalf of the Commonwealth is
a party within the
meaning of s. 75 (iii.) of the Constitution. Although it was unnecessary in
that case to decide into which part of s. 75 (iii.) the matter fell, Barwick
C.J. preferred "to regard the matter as one in which the Commonwealth was a
party" (1969) 119 CLR,
at p 336 . The view of Kitto J., with whom Windeyer J.
agreed, is less than clear upon this point. His Honour quoted the remarks
of
Griffith C.J. in Heiner v. Scott [1914] HCA 82; (1914) 19 CLR 381, at p 393 concerning the
original Commonwealth Bank Act 1911:
"Probably the
true effect of the Act is a
declaration
that the Commonwealth may itself carry on the business of banking
under the
name of the
'Commonwealth Bank of Australia'", and his
Honour went
on to say (1969) 119 CLR, at p 342 :
"The Banking Case [1948] HCA 7; (1948) 76 CLR 1 shows that the statement is true
without the word 'probably'; and in my
opinion a similar
statement may be made
with respect to the provisions of the Commonwealth Banks Act 1959,
substituting for the
'Commonwealth Bank
of Australia' the names of the three
banks amongst which that Act divides so much of the
business of government
banking as the
Reserve Bank Act has not declared that the Commonwealth may
carry on under the name of the
'Reserve Bank of Australia'."
(at p397)
5. From these observations it might be thought that Kitto J. was disposed to
take the same view as that expressed by the Chief
Justice. But his Honour's
conclusion was that the action was one in which the Bank was being sued on
behalf of the Commonwealth.
How his Honour arrived at this conclusion in view
of his earlier reference to the judgment of Griffith C.J. in Heiner v. Scott
and the comment which he made as to its application to the Inglis Case is by
no means apparent. For my part, agreeing as I do with
Kitto J.'s reasoning, I
prefer to accept the conclusion for which the Chief Justice expressed a
preference, namely that the action
was one in which the Commonwealth was a
party. (at p398)
6. The command in s. 81 of the Constitution that "All revenues or moneys raised or received by the Executive Government of the Commonwealth shall form one Consolidated Revenue Fund" is not an obstacle to this conclusion. This section is not addressed to statutory corporations which represent the Commonwealth through which the Commonwealth carries on an activity or undertaking. How the Commonwealth could effectively carry on or participate in banking business if it were compelled to pay all moneys raised or received in the course of the conduct of that business into Consolidated Revenue was not explained. (at p398)
7. On the view that the Bank is the Commonwealth it would seem to follow that the suit is one to which the Commonwealth is a party within the meaning of s. 64 of the Judiciary Act. This conclusion is inevitable unless the expression "the Commonwealth" in that section is to be confined to the Commonwealth stricto sensu so as to exclude a statutory corporation which is an agent or instrumentality of the Commonwealth. (at p398)
8. Section 75 (iii.) of the Constitution draws a distinction between the Commonwealth and a person suing or being sued on behalf of the Commonwealth. Yet the effect of the provision is to bring all actions in which the Commonwealth and such a person are parties within the perimeter of federal jurisdiction. Although the distinction that is drawn by s. 75 (iii.) provides some reason for thinking that the expression "the Commonwealth" might be used in a restricted sense in s. 64 of the Judiciary Act so as to exclude statutory corporations which represent the Crown, I do not think that the section should be given such a narrow construction. It would be a surprising result, to say the least of it, if s. 64 were to equate the rights of the Commonwealth to those of the citizen, yet leave a statutory corporation representing the Crown in right of the Commonwealth in possession of immunities and privileges attaching to it merely because it represents the Crown. The conclusion is, I think, inescapable that the expression "the Commonwealth", at least where it appears in ss. 56, 57 and 64 of the Judiciary Act, includes statutory corporations representing the Crown, certainly in cases where, as here, it is the Commonwealth that is carrying on the relevant activity under a corporate name. (at p399)
9. There may be some question whether "the Commonwealth" bears such a broad meaning in ss. 61, 65, 66 and 67 of that Act, but these provisions are procedural in character, dealing with the name in which the Commonwealth may sue, and execution and satisfaction of judgments in suits in which the Commonwealth is a party. Likewise s. 55E, which was inserted by Act No. 55 of 1966, is a special provision setting out the persons or bodies for whom the Crown Solicitor may act. Even if in these provisions the expression "the Commonwealth" should be more narrowly construed, I would not regard that circumstance as requiring that a similar interpretation be given to ss. 56, 57 and 64. (at p399)
10. It will be recalled that in Pitcher v. Federal Capital Commission (1928) 41 CLR, at p 389 et seq Knox C.J. and Powers J. held that ss. 56 and 64 applied to the Commission on the footing that it was "a corporation to which is handed over the administration of what is really a department of the Commonwealth Government". And in Naismith v. McGovern [1953] HCA 59; (1953) 90 CLR 336 , s. 64 was held to apply to a suit in which the Commissioner of Taxation was a party, his function in collecting the revenue being that of a department of government according to traditional notions. As Latham C.J. observed in South Australia v. The Commonwealth (the Uniform Tax Case) [1942] HCA 14; (1942) 65 CLR 373, at p 423 , it is impossible to distinguish "within functions of government, between essential and non-essential or between normal or abnormal", and "any activity may become a function of government if parliament so determines". There is accordingly no reason why a distinction between essential and non-essential functions of government should be drawn in applying s. 64 to statutory corporations which represent the Commonwealth. (at p399)
11. In one sense it is sufficient to dispose of this case to say that s. 64 certainly applies to procedural rights. Even if the authorities leave other questions obscure they at least speak plainly upon this point. The consequence is that s. 64 operates so as to make applicable to the Bank the provisions of s. 14 (1) of the Limitation Act which bar the remedy of the Bank after the expiration of six years from the date on which the Bank's cause of action first accrued, for this provision is unquestionably procedural and not substantive in character, barring the remedy after the lapse of the prescribed period of time (Pedersen v. Young [1964] HCA 28; (1964) 110 CLR 162, at p 166 ; John Robertson & Co. Ltd. v. Ferguson Transformers Pty. Ltd. (1973) 129 CLR, at pp 92-93 ); it does not extinguish the cause of action itself: cf. William Crosby & Co. Pty. Ltd. v. The Commonwealth [1963] HCA 6; (1963) 109 CLR 490, at p 493 . (at p400)
12. But, as there is the further question whether s. 63 (2), which is a substantive provision, also applies to extinguish the Bank's rights, there is a strong reason for examing the more controversial question whether s. 64 operates so as to pick up and make applicable to the Bank substantive as well as procedural provisions. In my opinion it does. (at p400)
13. This conclusion is in conformity with the language of the section which refers to "the rights of the parties" "in any suit", without qualifying those rights in any way. The subsequent reference to the giving of judgment, a judgment which necessarily gives effect to the rights of the parties, both substantive and procedural, suggests that the rights dealt with by the section are of the same character. The immediate context in which s. 64 appears provides some support for the contrary view: ss. 61-63 and 65-67 are procedural in character. But the force of this consideration is diminished by the circumstance that these sections begin with the name in which the Commonwealth may sue and end with the provisions relating to execution. As they span the litigious process from institution to execution it is not incongruous that at an appropriate point the provisions happen to deal with the substantive rights to which effect shall be given. (at p400)
14. Support for this broad view of the section is provided by the decision of the Privy Council in Farnell v. Bowman (1887) 12 APP cAS 643 on ss. 2 and 3 of the Claims against the Government Act, 1876 (N.S.W.), where the sections were held to apply to substantive as well as to procedural rights. There the statute contained an earlier reference to "proceedings" which perhaps assisted the conclusion that the reference to "rights" was not limited to matters of procedure. However, it is not a feature which in my view supplies a sufficient point of distinction from s. 64. In Baume v. The Commonwealth [1906] HCA 92; (1906) 4 CLR 97 , this Court unanimously held that s. 64 should be given a construction similar to that favoured in Farnell v. Bowman, being of opinion that the language of the section was indistinguishable from that of s. 3 of the Claims against the Government Act, 1876. Although Isaacs J. in Griffin v. South Australia (1924) 35 CLR, at p 204 thought that s. 64 was confined to procedural rights, the current of opinion has flowed in the opposite direction. Pitcher's Case [1928] HCA 44; (1928) 41 CLR 385 , to which I have referred in another connexion, is authority for the proposition that the section applies to substantive as well as procedural rights. There all the members of the Court held that ss. 56 and 64 of the Judiciary Act operated to pick up and apply the provisions of the Compensation to Relatives Act, 1897 (N.S.W.). In Asiatic Steam Navigation Co. Ltd. v. The Commonwealth (1956) 96 CLR, at p 427 , Kitto J. said that the rights referred to in s. 64 included substantive as well as procedural rights and that the section made applicable to the Commonwealth and State "the whole body of the law . . . by which the rights of the parties would be governed if the Commonwealth or State were a subject instead of being the Crown". Fullagar J. disagreed, asserting that s. 64 does not operate to pick up and apply to the Commonwealth a statute the express terms of which exclude the Crown (1956) 96 CLR, at p 424 . Although Dixon C.J., McTiernan and Williams JJ. left the question undecided (1956) 96 CLR, at p 417 , they said nothing to indicate their support for the view that the rights referred to in the section are procedural only. (at p401)
15. In The Commonwealth v. Anderson (1960) 105 CLR, at pp 317-318 , Menzies J. referred to the remarks of Kitto J. in the Asiatic Case, specifically disagreeing with the remarks of Kitto J. in that case, pointing out that if s. 64 were held to apply to substantive rights, its validity would require consideration in view of its reference to the rights of a State as well as to those of the Commonwealth. Menzies J. reiterated his view in Downs v. Williams [1971] HCA 45; (1971) 126 CLR 61, at p 69 . However, in that case Gibbs J. (1971) 126 CLR, at pp 100-102 expressed his agreement with the observations of Kitto J. in the Asiatic Case and his disagreement with the view of Fullagar J. His Honour drew attention to the fact that Fullagar J. had relied on the remarks of Viscount Simonds in Nisbet Shipping Co. Ltd. v. The Queen (1955) 1 WLR 1031, at p 1036; (1955) 3 All ER, at p 164 , evidently without appreciating, as Dixon C.J., McTiernan and Williams JJ. noted, that the Nisbet Shipping Co. Case, unlike the Asiatic Case, was one in which it was necessary to reconcile two enactments of the one legislature. (at p401)
16. The inclusion in s. 64 of the reference to the rights of a State does create a difficulty which is more readily eliminated if the section is confined to procedural rights. The extent to which the Commonwealth may legislate so as to affect the substantive rights of a State in the exercise of federal jurisdiction is an unexplored question. In the exercise of the powers conferred by s. 51 the Commonwealth may make laws which alter or affect such substantive rights, but it is doubtful, to say the least of it, whether the Commonwealth possesses a universal competence with respect to such rights, say, for example, by virtue of s. 51 (xxxix.). Even so, this is not to my mind a sufficient reason for confining the operation of s. 64 to procedural matters. The section can, and if need be should, be read as applying to all such rights as lie within the reach of the legislative power. (at p402)
17. In this case we are not concerned to decide whether a State statute, which explicitly excludes the Crown from its operation, is attracted to the Commonwealth by virtue of s. 64 because the Limitation Act is expressed to apply to the Crown. Consequently, the observations of Fullagar J. in the Asiatic Case (1956) 96 CLR, at p 424 do not assist the Bank. It will be recalled that his Honour thought that the section could not attract to the Commonwealth State laws which were expressed to exclude the Crown. As I understand his Honour's remarks, he did not confine the operation of the section to procedural matters but thought that it extended to substantive rights, subject to the qualification which I have already mentioned. However, I should not let the occasion pass without expressing my disagreement with his Honour's view. What the section does is to equate the rights of the Commonwealth to those of the citizen. In so far as the rights of the citizen are created by a State law, it is an irrelevant consideration that the Crown is excluded from the operation of the State law. The section looks to the rights of the citizen as against a fellow citizen; it does not look to the rights of the citizen as against the Crown. The precise content of the words "as nearly as possible" is obscure. Whatever they may mean, they cannot be regarded as preserving in every case the special position of the Crown as it exists under State law. (at p402)
18. In the view I take of this case I have no occasion to consider the doctrine which was enunciated in The Commonwealth v. Cigamatic Pty. Ltd. [1962] HCA 40; (1962) 108 CLR 372 . However, I should point out that no mention was made of s. 64 in that case, although there seems to be no reason why it should not have had an application if it extended to substantive rights. None the less, as the section was not argued I do not regard the decision as constituting authority for the proposition that the section does not apply to substantive rights. (at p402)
19. I would answer the questions asked - (a) Unnecessary to answer. (b) Yes. (at p402)
JACOBS J. The Limitation Act, 1969 (N.S.W.) provides in s. 14 (1) that action on certain causes of action (among them simple contract debts) is not maintainable if brought after the expiration of a limitation period of six years running from the date on which the cause of action first accrues. It further provides by s. 63 (1) that on the expiration of a limitation period for a cause of action to recover, among other things, a debt, the right and title of the person formerly having the cause of action is, against the person against whom the cause of action formerly lay and as against his successors, extinguished. (at p403)
2. The Commonwealth Trading Bank of Australia was owed certain money on current account by partners carrying on the business of Nobles Narrandera Quarries. The last dealing in the partnership bank account was entered on 15th February 1966 and that left a debit balance in the account at that date of $5,325.17. Shortly thereafter the main assets of the partnership were agreed to be sold. The sale was not completed until 1972. The net proceeds of sale, $9,832, were retained in solicitors' trust accounts until 7th February 1975 when an order of the Supreme Court of New South Wales was made that that sum be paid into court, to be retained pending the further order of the Court. Notice of proceedings to determine claims to the fund was given to various interested parties. In the proceedings before Holland J. in early April 1976 the Bank appeared to support its claim. The plaintiffs submitted that the Bank's claim was not an enforceable debt because it was barred and extinguished by operation of s. 14 (1) and s. 63 (1) of the Limitation Act. In reply the Bank asserted that the Limitation Act did not validly apply to the Bank. Holland J. held that an inter se question had thereby arisen and that the proceedings were removed into this Court by the operation of s. 40A of the Judiciary Act. (at p403)
3. Upon the matter being removed into this Court, Barwick C.J. stated a
question on agreed facts for determination by a Full Court
as follows:
"Would ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.) be
aplicable in an action commenced in the Supreme Court of New South Wales by
the Commonwealth Trading Bank of Australia
in which it sought to recover the
balance of a current account said to be owed to it by a customer -
(a) either of their own force, or
(b) by virtue of the Judiciary Act?" (at p403)
4. If any provision of the Judiciary Act governs the matter then the question
whether in the absence of that provision the sections
of the Limitation Act
would be applicable to the Bank, a question which would probably require a
reconsideration of the reasons
for decision in The Commonwealth
v. Cigamatic
Pty. Ltd. [1962] HCA 40; (1962) 108 CLR 372 , is hypothetical. I think that it is
therefore
correct
to examine first the effect of the Judiciary Act. At the same time,
however, I am conscious of the somewhat curious
situation that
the effect of
the Judiciary Act was not discussed in the reasons for judgment of any member
of the Court in Cigamatic
and yet it
would appear to me that, at least
in
respect of the moneys owing to the Commonwealth under the Post and Telegraph
Act
1901 and
the Telephone Regulations and Telegraph
Regulations, the
provisions of the Judiciary Act were as relevant there to be considered
as
they are in the present case. Nevertheless it appears to me that the question
whether
the reasoning in Cigamatic involves a
revival of the doctrine of
implied immunity of instrumentalities and whether it is essentially
consistent
with the Engineers' Case
[1920] HCA 54; (1920) 28 CLR 129 should not be pursued unless its
determination is essential to the present decision. (at p404)
5. I turn therefore to the Judiciary Act, and in particular to s. 64 which
provides:
"In any suit to which the Commonwealth or a State is a party, the rights
of parties shall as nearly as possible be the same,
and judgment may be given
and costs awarded on either side, as in a suit between subject and subject."
(at p404)
6. The power to enact this provision, so far as it confers rights to proceed
against the Commonwealth or a State, springs from
s. 78 of the Constitution -
"The Parliament may make laws conferring rights to proceed against the
Commonwealth or a State in respect of matters within the
limits of the
judicial power." The matters within the limits of the judicial power, as set
out in ss. 75 and 76, include those in s. 75 (iii.) and (iv.). It appears to
me to be the acceptable interpretation that the latter sub-sections are the
source of federal jurisdiction,
but that the rights against the Commonwealth
or a State enforceable in that jurisdiction are those conferred by the
Parliament
by virtue of s. 78. The opinion of the majority in The Commonwealth
v. New South Wales [1923] HCA 23; (1923) 32 CLR 200 was that s. 75 (iii.) was itself the
source of substantive rights; but see Musgrave v. The Commonwealth (1937) 57
CLR 514 and Werrin v. The Commonwealth
[1938] HCA 3; (1938) 59 CLR 150 , in particular the
discussion of the problem by Dixon J. in the latter case (1938) 59 CLR, at
pp
167-168 .
Since
s. 64 deals not only with suits where the Commonwealth is a
party but also with suits where a State is a party, it appears to me that
the
source of its validity is partly at least to be found in s. 78 of the
Constitution. (at p404)
7. It is true that s. 78 of the Constitution deals only with rights to
proceed against the Commonwealth or a State whilst s. 64 of the Judiciary Act
deals with rights of the
Commonwealth or a State in all suits where the
Commonwealth or a State is a party, plaintiff or defendant.
The source of the
power
to prescribe the rights of a State when that State is seeking relief
rather than the subject of proceedings
against it is not clear
to me, but that
question does not arise in the present case. However, the fact remains that s.
64 of the
Judiciary Act in so far
as it deals with rights to proceed against
the Commonwealth or a State is enacted pursuant to s. 78 and that fact is, It
think,
of some assistance in determining whether the subject matter of s. 64
includes not only procedural rights but also substantive rights.
Once
jurisdiction is found to be conferred by s. 75 (iii.) and (iv.), procedural
rights would, in the absence of particular provision
by the Parliament, be
governed by the rules of
procedure of the court exercising the federal
jurisdiction. It therefore appears
to me that when the Parliament enacted s.
64 of
the Judiciary Act a main purpose was to prescribe by virtue of s. 78 of
the Constitution the rights against the Commonwealth or a State which would be
enforceable in a court exercising federal jurisdiction when the source
of the
federal jurisdiction was the fact that the Commonwealth was a party as
provided in s. 75 (iii.) or a State was a party in the circumstances provided
in s. 75 (iv.) of the Constitution. (at p405)
8. Since the prescription of rights to proceed against the Commonwealth or a State was in this way a purpose of s. 64 the section cannot be treated as dealing only with procedural matters. The words "rights to proceed" in s. 78 are appropriate to refer to rights which entitle a person to proceed, to initiate an action, against the Commonwealth or a State. They cannot be limited to procedural matters in an action already initiated. That being so, there is no reason why s. 64 should not be construed as dealing with the prescription of substantive rights, including the rights of the parties when the Commonwealth is a plaintiff as well as when it is a defendant. This conclusion, I think, accords with the general current of authority in this Court although it must be conceded that the line of authority is not wholly clear and consistent. I cannot usefully add anything to the analysis of the cases which has been made in the reasons for judgment of other members of the Court. (at p405)
9. It has been held that the Commonwealth Trading Bank of Australia is "the Commonwealth or a person suing or being sued on behalf of the Commonwealth" within the meaning of those words in s. 75 (iii.): Inglis v. Commonwealth Trading Bank of Australia [1969] HCA 44; (1969) 119 CLR 334 . Section 78 refers only to the Commonwealth and not to a person being sued on behalf of the Commonwealth but I do not think that the difference in language has a significant difference in effect. Section 75 (iii.) deals with cases where the Commonwealth in substance, though not necessarily in form, is suing or being sued. The intention was to make the words as comprehensive as poosible. I do not think that it was intended to make a definitive categorization between the Commonwealth on the one hand and on the other hand a person suing or being sued on behalf of the Commonwealth. In this context the word "Commonwealth" in s. 78 should be taken to embrace not only the case where in form the Commonwealth is the actual party on the record but also the case where the actual party is a person being sued on behalf of the Commonwealth. Section 64 of the Judiciary Act should be construed in the same manner. I would, however, add, although in the event it is not necessary to be decided, that it does not follow that, because the Bank falls within the descriptions in s. 75 (iii.) and the description in s. 78 of the Constitution, it is necessarily the Crown in right of the Commonwealth so that there is attracted to it any prerogative immunity of the Crown in respect of limitation of action. The latter subject matter and the subject matter of s. 75 (iii.) are different. Section 75 (iii.) should be given a wide construction and effect: the Banking Case (1948) 76 CLR 1 ; Inglis's Case (1969) 119 CLR, at pp 335-336 , per Barwick C.J. On the other hand the Crown prerogative does not generally extend as widely. Cf. Rural Bank of New South Wales v. Bland Shire Council [1947] HCA 28; (1947) 74 CLR 408, at p 417 ; Rural Bank of New South Wales v. Hayes [1951] HCA 58; (1951) 84 CLR 140, at p 146 . But on this aspect I do not need to express a concluded view. Section 64 of the Judiciary Act is applicable and therefore the rights of the Bank (as "the Commonwealth" within the meaning of the word in that section) and of a person sued by it for the recovery of money lent are to be as nearly as possible the same as in a suit between subject and subject. In a suit between subject and subject ss. 14 (1) and 63 (1) of the Limitation Act would apply and those sections likewise would be applicable in an action by the Bank to recover the balance of a current account. (at p406)
10. I would therefore answer the questions as follows: (a) Unnecessary to answer; (b) Yes, by virtue of s. 64 thereof. (at p406)
MURPHY J. This matter was removed into this Court by operation of s. 40A of
the Judiciary Act 1903, as amended. The Chief Justice
directed that the
following question be argued before a Full Court:
"Would ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.) be
applicable in an action commenced in the Supreme Court of New South Wales by
the Commonwealth Trading Bank of Australia
in which it sought to recover the
balance of a current account said to be owed to it by a customer -
(a) either of its own force, or
(b) by virtue of the Judiciary Act?" (at p407)
2. The Limitation Act, 1969 (N.S.W.), in so far as it purports to apply of its own force to the Commonwealth Trading Bank, is invalid (Williams v. Hursey [1959] HCA 51; (1959) 103 CLR 30, at p 68 ). The collection of debts by the Commonwealth Trading Bank is a subject of dominant federal interest. The State Act is pre-empted by federal law in the absence of an intention to allow the State Act to operate. No such intention is expressed or implied in the Commonwealth Banks Act 1959 (Cth). (at p407)
3. The Commonwealth Banks Act does not confer any governmental (Crown) privileges on the Commonwealth Trading Bank in relation to its debts. The function of the Bank is to carry on general banking business (s. 28). The Parliament did not intend to put the Bank's customers in the position of a subject dealing with the Crown (that is, in a worse position than customers of private banks). This would have disadvantaged the Bank as well as its customers and other. I find no reasons for (and many against) introducing notions of governmental privilege into this area. (at p407)
4. Section 64 of the Judiciary Act states:
"In any suit to which the Commonwealth or a State is a party, the rights
of parties shall as nearly as possible be the same,
and judgment may be given
and costs awarded on either side, as in a suit between subject and subject."
The Bank is regarded as the Commonwealth for the purposes of s. 75 of the
Judiciary Act (Inglis v. Commonwealth Trading Bank of
Australia (1969) 119 CLR
334 ). It is also the Commonwealth for the
purposes of s. 64 of the Judiciary
Act. The main arguments
in this case centred on whether s. 64 was confined to
procedural rights.
In my opinion, s. 64 applies to substantive as well as
procedural rights. This construction is supported by the weight of authority,
the most important of which is Asiatic Steam Navigation
Co. Ltd. v. The
Commonwealth (1956) 96 CLR 397 . (at p407)
5. Section 64 is ambulatory, as the Commonwealth conceded in Moore v. The Commonwealth (1958) 99 CLR, at p 182 . Jordan C.J.'s construction in Washington v. The Commonwealth (1939) 39 SR (NSW) 133 was too restrictive. (at p408)
6. The consequence of this construction of s. 64 is that, in the absence of uniform State laws on a subject, the party to a suit to which the Commonwealth or a State is a party may be dealt with differently (not only procedurally but substantively) according to the State in which the action is heard or decided. This may mean that a person in one State will have a right to succeed against the Commonwealth while a person in similar circumstances in another State will not; and a person may be liable to the Commonwealth where a person in similar circumstances in another State will not be liable. The issue of the Parliament's competence to use (directly or, as in this case, indirectly) its legislative power to make different laws for those in different States, and so to discriminate between the people of various States was not raised. The effect, if any, of s. 99 of the Constitution was not raised. It was not contended that the discriminatory consequences should tell against imputing to Parliament the intention to deal with substantive law in s. 64. (at p408)
7. Thus, s. 64 of the Judiciary Act incorporates by reference the provisions of the Limitation Act and makes them applicable to the Bank. The Limitation Act becomes, for this purpose, surrogate Commonwealth law. (at p408)
8. Although s. 64 contains the qualification "as nearly as possible", I see no basis for holding that it is impossible to apply the Limitation Act. The present case is not concerned with "special situations arising out of purposes or functions peculiar to Government" (referred to by Dixon C.J. and McTiernan and Williams JJ. in Asiatic Steam Navigation Co. Ltd. v. The Commonwealth (1956) 96 CLR, at p 417). (at p408)
9. It follows that the questions asked should be answered:
(a) No. (b) Yes. (at p408)
ORDER
Question referred to be answered as follows:
Question: Would ss. 14 (1) (a) and 63 of the Limitation Act, 1969 (N.S.W.)
be applicable in an action commenced in the Supreme Court of New South Wales
by the Commonwealth Trading Bank of Australia
in which it sought to recover
the balance of a current account said to be owed to it by a customer -
(a) either of their own force, or
(b) by virtue of the Judiciary Act?
Answer: (a) Unnecessary to answer(b) Yes.
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