CLAIMS AGAINST THE COMMONWEALTH AND STATES AND THEIR INSTRUMENTALITIES IN FEDERAL JURISDICTION: SECTION 64 OF THE JUDICIARY ACTl Susan Kneebone* INTRODUCTION Two recent decisions of the High Court, Mutual Pools and Staff Pty Ltd v Commonwealth 2 (Mutual Pools) and Georgiadis v Australian and Overseas Telecommunication Corporation 3 (Georgiadis) have re-opened the debate about the source of the Commonwealth's liability to be sued in civil proceedings. 4 The debate can be expressed in this form: does that liability arise from the Constitution so as to confer a constitutionally guaranteed right to sue the Commonwealth (the "constitutional argument") or does it arise from rights conferred by s 64 of the Judiciary Act 1903 (Cth) - possibly in combination with "rights to proceed" allowed by the Constitution?5 In practical terms this is a difference between entrenching the Commonwealth's liability in the Constitution or acknowledging that those "rights to proceed" can be removed by Commonwealth legislation preventing action against it. Before his recent appointment to the High Court, Gummow J raised the issue in two cases in the Federal Court, pointing to the conflict of opinion between Brennan J (as he then was) and McHugh J in Georgiadis. In Bienke v Minister for Primary Industries and Energy,6 an action in negligence against the Commonwealth Minister, Gummow J commented that "in Australia, consideration ... is required of the extent of the 'waiver' of liability effected by the Judiciary Act, or by the Constitution itself, something still * Lecturer, Faculty of Law, Monash University. This article is a revised version of a paper presented to the 45th ALTA Conference, Australian National University, September 1990, "Claims in Tort in the Federal Jurisdiction: Section 64 of the Judiciary Act". I would like to thank Professor Enid Campbell, Professor Leslie Zines and Associate Professor Peter Hanks for their detailed comments on that paper. I accept responsibility for errors or misconceptions which may appear in this article. [1994] HCA 9; (1993) 179 CLR 155. (1993) 179 CLR 297. The definition of "suit" in the Judiciary Act 1903 (Cth) makes it clear that it does not extend to criminal proceedings: below n 23. See also Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254 at 265. For example, Commonwealth v Dinnison (1995) 129 ALR 239 at 243 per Gummow and Cooper JJ. (1994) 125 ALR 151; 34 ALD 413. 1 2 3 4 5 6 94 Federal Law Review Volume 24 unresolved ... ".7 In Commonwealth v Dinnison 8 he again referred to the debate as "unsettled"9. In view of the current composition of the High Court the debate is thus a live one. The question is whether the Commonwealth's liability should be treated as a constitutional issue or whether its civil liability should be governed by the common law. In this article, it is argued that the latter view is most consistent with the basic rule that the civil liability of governments is to be assimilated to that of private individuals "as nearly as possible" as the words of s 64 recognise. 10 It is important to note that this basic rule was recognised and applied by the majority in Northern Territory v Mengel (Mason CJ, Dawson J, Toohey J, Gaudron J and McHugh J);11 they expressly referred to s 64 of the Judiciary Act. Arguing in favour of constitutionally guaranteed rights, Aitken suggests that his view is consistent with the "dignity" of the Constitution.l 2 He suggests that the view that the Commonwealth's liability can be removed by lefislation "demeans the Constitution as the fundamental doctrine of the Federation"l and further, that such view is "legally disingenuous".14 He supports his argument by pointing to the impossibility of reconciling all the "minutiae" surrounding s 64 of the Judiciary Act and contrasts the appealing simplicity of the constitutional argument. 1S He attacks the s 64 view on the basis that it seems "odd" that the Commonwealth Parliament has no control over the Commonwealth's liability.16 My argument is that the way that s 64 has been interpreted by the courts provides a flexible case-by-case approach appropriate to determining the civil liability of governments and that it provides adequate protection for citizens' rights. The effect of the constitutional argument, however, enhances the assumed superiority of the Commonwealth in inter-governmental matters. In response to Aitken, I suggest that the constitutional argument depends upon equating a grant of jurisdiction with entrenched liability. I argue that the constitutional argument overlooks the importance of an essential and basic distinction, recognised by the courts, between liability to be sued and the conferral of jurisdiction or authority to adjudicate. This distinction is in turn consistent with the separation of powers which the Constitution implies. By enacting s 64 of the Judiciary Act, the legislature has conferred power upon the courts to determine the extent of liability of parties sued in the federal jurisdiction. The High 7 8 9 10 11 12 13 14 15 16 Ibid at 173; 433, citing Georgiadis v Australian and Overseas Telecommunications Corp (1993) 179 CLR 297. (1995) 129 ALR 239. Ibid at 243 per Gummow and Cooper JJ. This basic principle is enshrined in the common law and in the various Crown proceedings Acts of each State, eg: Crown Proceedings Act 1980 (Qld), s 9(2); Crown Proceedings Act 1992 (SA) s 5(1)(b). Cf Crown Proceedings Act 1958 (Vic), s 23(1)(b), pursuant to which the liability of the Crown is a vicarious one. (1995) 69 ALJR 527 at 544, n 82. L Aitken, "The Liability of the Commonwealth under Section 75(iii) and Related Questions" (1992) 15 UNSWLl483 at 485-486; L Aitken, "The Commonwealth's Entrenched Liability Further Refinements" (1994) 68 ALl 690 at 690-691. L Aitken (1994), above n 12 at 690. L Aitken (1992), above n 12 at 485-486 and 491. Ibid at 514. Ibid at 487. 1996 Section 64 of the Judiciary Act 95 Court has, however, recognised that its jurisdiction is entrenched by the Constitution. This provides some assurance that the rights of citizens against the Commonwealth will be protected by the law, in contrast to the position under State Constitutions. This has become a major issue in Victoria, for example, in relation to damage caused by works associated with the staging of the Formula One Grand Prix race at Albert Park. Although s 85 of the Constitution Act 1975 (Vic) prescribes a procedure for statutes altering the jurisdiction of the Supreme Court, it does not entrench the jurisdiction of the Court, and legislation has removed the common law rights of citizens to sue for damages. 17 The debate raises extraordinarily complex issues. To begin with, because s 64 of the Judiciary Act has been interpreted to apply in actions between States, the debate must be extended to include the position of States sued in the federal jurisdiction. 18 It raises the basis of the contract and tort liability of the Commonwealth, States and their instrumentalities, as s 64 extends to the latter. 19 To what extent does that liability depend upon the express removal of the Crown's traditional immunity in tort (and possibly contract)? The context is often inter-governmental immunities because s 64 has been interpreted as applying the statutes of one legislature to another government. 20 Another relevant context is principles of conflict of law. I tum first to a summary of these issues before examining in more detail the application of s 64 and the two High Court decisions in Mutual Pools and Georgiadis. SECTION 64 IN CONTEXT Section 64 appears in Part IX of the Judiciary Act 1903 (Cth), which makes provision for "Suits By and Against the Commonwealth and the States". Sections 56-59 of the Judiciary Act 1903 (Cth) (in Part IX) make provision for claims to be brought by and against the Commonwealth and the States, in courts exercising federal jurisdiction. Sections 56 and 57 each provide for claims in "contract or in tort" to be brought against the Commonwealth by private persons and States respectively. Sections 58 and 59 refer to claims against States by "any person" (which has been held to include the Commonwealth)21 or by another State. The claims to which s 58 refers are in "contract or in tort", but s 59 refers simply to "any claim" without limiting it to contract or tort. Sections 56-59 also provide the venue22 for the hearing of such "suits",23 in courts exercising federal jurisdiction. 24 Section 64 provides: 17 For example, Australian Grand Prix Act 1994 (Vic), s 50. Cf R v Hickman & ors : Ex parte Fox and Clinton [1945] HCA 53; (1945) 70 CLR 598. For a discussion of the effect of s 85, see C Foley, "Section 85 Victorian Constitution Act 1975: Constitutionally Entrenched Right ... or Wrong" (1994) 20 18 19 20 21 22 23 24 Mon LR 110. The nature of the federal jurisdiction is considered below at 102. Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362. Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254; Commissioner for Railways v Peters (1991) 102 ALR 579. Commonwealth v New South Wales (1923) 52 CLR 32. See the discussion below at 103-104. "Suit" is defined in s 2 to include "any action or original proceeding between parties". The meaning of "federal jurisdiction" is discussed below at 102-105. 96 Federal Law Review Volume 24 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. Removal of Crown immunity Section 64 either alone or in conjunction with ss 56 and 57 is on its face directed to removing the Commonwealth's traditional immunity in tort and contract. The history of the Crown's immunity in tort shows that there needed to be an express removal of that immunity.25 In the case of the Commonwealth, the framers of the Australian Constitution recognised that a grant of jurisdiction was not sufficient in itself to remove the immunity.26 Thus the Claims Against the Commonwealth Act 1902 (Cth)27 was enacted to provide that persons making claims in contract or in tort against the Commonwealth could petition the Governor-General requesting him to appoint a nominal defendant. 28 That Act was repealed by the Judiciary Act 1903 (Cth) and its provisions replaced by Part IX. In two early decisions where these provisions were considered it was decided that their combined effect was to render the Commonwealth liable in tort in the same manner as State Crown proceedings legislation. 29 In a number of decisions it has been recognised that the effect of s 64 in combination with s 56 renders the Commonwealth liable in tort as if it were a citizen according to ordinary tort principles (but subject to any residual Crown immunities).30 In the case of the States, other than Victoria, all had legislated to remove their immunity in tort by the 25 Farnell v Bowman (1887) 12 App Cas 643 (PC). With respect to claims in contract, it is arguable that no express removal of immunity was necessary as the petition of right lay against the Crown for claims in contract. However, that procedure required the consent of the Crown so the difference may not be great. See Thomas v R (1874) LR 10 QB 31; P Hogg, Liability of the Crown (2nd ed 1989) at 5-6; S Arrowsmith, Government Procurement and Judicial Review (1988) at 113-118; cf G Donaldson, "Commonwealth Liability to State Law" (1985) 16 UWALR 135, who maintains the distinction. Convention Debates, Melbourne 1898, 1653-79 quoted in J Quick and D G Garran, The Annotated Constitution of the Australian Government 1901 (1976) at 804-6. It is clear from the debates that s 78 of the Constitution was intended to confer the power to remove the Crown's common law immunity from suit. Howeyer, as is pointed out by Professor Campbell, s 78 may not be the exclusive source of "rights to proceed" under Part IX of the Judiciary Act 1903 (Cth): E Campbell, "Section 78 of the Commonwealth of Australia Constitution Act" (unpublished) Faculty of Law, Monash University, September 1987; see also Final Report of the Constitutional Commission (1988) vol 1 at para 6.275. The Hansard debates on the 1902 Act suggest that the purpose of the Act was to overcome the immunity of the Crown from action and to bring the liability of the Commonwealth in line with that of the States. See Cth ParI Deb 1902, Vol 12 at 16449-16466, 16668-16673, and 16714-16728. Section 2(1). The procedural model of the Claims Against the Government and Crown Suits Act 1897 (NSW) is clear. This legislation was similar to that in issue in Farnell v Bowman (1887) 12 App Cas 643. However, it should be noted that the Commonwealth Act expressly refers to claims in tort and contract. Baume v Commonwealth [1906] HCA 92; (1906) 4 CLR 97 at 110; Zachariassen v Commonwealth [1917] HCA 77; (1917) 24 CLR 166. In Baume v Commonwealth, O'Connor J pointed out that the Judiciary Act 1903 (Cth) amended the procedure of the 1902 Act to enable a subject to sue the Commonwealth direct: [1906] HCA 92; (1906) 4 CLR 97 at 118-9. For example, Shaw Savill & Albion Co Ltd v Commonwealth [1940] HCA 40; (1940) 66 CLR 344; Parker v Commonwealth [1965] HCA 12; (1965) 112 CLR 295. 26 27 28 29 30 1996 Section 64 of the Judiciary Act 97 time the Judiciary Act came into force. 31 It may be that the removal of their immunity in tort was effected by that State legislation rather than by ss 58 and 59 of the Judiciary Act. 32 Inter-governmental immunities Section 64 has, however, been seen as going beyond removing the Crown's traditional immunity and supplying the "right to proceed" where a common law liability is in issue. By applying the statutes of one government to another, it enables the modification of common law liabilities in proceedings in tort33 or contract34 and imposes liability both where that liability arises from a "novel statutory right"35 and where that liability is a common law one arising from the implication of the right to sue for breach of statutor~ duty.36 It is settled that those statutes include both those conferring procedural3 and substantive38 rights. Where the Commonwealth is a party, the explanation for this is that the provisions apply as if they were a Commonwealth law. In this way, s 64 performs a useful role which cannot be explained by the constitutional argument. Section 64's role in this respect appears to be at odds with the decision in Commonwealth v Cigamatic Pty Ltd,39 which is sometimes cited as authority for the proposition that State parliaments have no power to enact legislation which diminishes or affects the Commonwealth's legal rights. 40 However the Cigamatic decision, which is based upon Dixon J's assumed supremacy of the Commonwealth in relation to States, is controversial and has been questioned as a vestige of outdated immunity.41 Section 64 enables the effect of the Cigamatic decision, which enhances the position of the Commonwealth, to be avoided by applying State laws as if they were Commonwealth laws. 42 Aitken, however, argues that the Cigamatic doctrine provides a "further and more general residual protection for the Commonwealth against liability 31 The first State to legislate was South Australia in 1853 (Claims Against the Local Government Act, No 6 of 1853). The formula which s 64 of the Judiciary Act contains, specifying that the rights of the parties "shall as nearly as possible be the same ... as ... between subject and subject", was introduced by the Claims Against the Government Act 1866 (Qld) and reproduced in subsequent legislation. See Werrin v Commonwealth [1938] HCA 3; (1938) 59 CLR 150 at 166 per Dixon J, discussed below at 107108. Asiatic Steam Navigation Co Ltd v Commonwealth [1956] HCA 82; (1956) 96 CLR 397 (application of Merchant Shipping Act 1894 (Imp) to limit the Commonwealth's liability). Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362. Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254. Strods v Commonwealth [1982] 2 NSWLR 182 (approved in Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254). Commonwealth v Miller [1910] HCA 46; (1911) 10 CLR 742 (action for discovery); Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362. Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362. (1962) 108 CLR 372. P J Hanks, Australian Constitutional Law (5th ed 1994) at 451. J J Doyle, "1947 Revisited - The Immunity of the Commonwealth from State Law" in G Lindell (ed), Future Directions in Australian Constitutional Law (1994) 47; G Evans, "Rethinking Commonwealth Immunity" [1972] MelbULawRw 13; (1972) 8 Melb Univ LR 521; R P Meagher and W M C Gummow, "Sir Owen Dixon's Heresy" (1980) 54 ALJ 25; P J Hanks, above n 40 at 457; R Sackville, "The Doctrine of Immunity of Instrumentalities in the United States and Australia: A Comparative Analysis" [1969] MelbULawRw 2; (1960) 7 Melb Univ LR 15 at 62. Australian Postal Commission v Dao (1984) 63 ALR 1 at 30-35 per McHugh JA. 32 33 34 35 36 37 38 39 40 41 42 98 Federal Law Review Volume 24 under State law".43 This view does not appear to be supported either by principle or authority. In Commonwealth v Evans Deakin Industries Ltd, the majority in the High Court commented cryptically at the end of their judgment: The question whether The Commonwealth v Cigamatic Pty Ltd (In Liq) [1962] HCA 40; (1962) 108 C.L.R. 372 was correctly decided was not canvassed in argument and we do not need to consider it. 44 In Maguire v Simpson,45 Gibbs J thought that it was "unnecessary" to decide whether the Cigamatic decision should be followed. 46 Mason J pointed out that no mention was made of s 64 of the Judiciary Act in that case, "although there seems to be no reason why it should not have had an application if it extended to substantive rights".47 It has been sug~ested that on this basis, the Cigamatic decision could be considered wrongly decided. 4 It can be argued that the operation which the High Court has accorded to s 64 of the Judiciary Act is cOl\sistent with the view of Latham CJ in Uther v Federal Commissioner of Taxation,49 that laws of general application should be applied to the Commonwealth both in its dealings in contract and property matters and in relation to its tortious responsibilities. As Latham CJ has observed: The Commonwealth of Australia was not born into a vacuum. It came into existence with a system of law already established. To much of that law the Commonwealth is necessarily subject; for example, the Commonwealth has no general power to legislate with respect to the law of property, the law of contract, the law of tort. In relation to those subjects, speaking generally, it lives and moves and has its being within a system of law which consists of the common law (in the widest sense) and the statute law of the various States. 50 This view is subject to the proviso suggested by Lumb, namely that laws do not affect the Commonwealth in its "governmental" activities. 51 In some subsequent cases, a view similar to that of Latham CJ in Uther's case,52 namely that some State laws should apply to the Commonwealth, was accepted. This view is best expressed in the words of Fullagar J in Commonwealth v Bogle: If ... the Commonwealth Parliament had never enacted s 56 of the Judiciary Act 19031950, it is surely unthinkable that the Victorian Parliament could have made a law rendering the Commonwealth liable for torts committed in Victoria. The Commonwealth may, of course, become affected by State laws. If, for example, it makes a contract in 43 44 45 46 47 48 49 50 51 52 L Aitken (1992), above n 12 at 508-512. [1986] HCA 51; (1986) 161 CLR 254 at 267. [1977] HCA 63; (1976) 139 CLR 362. Ibid at 390. Ibid at 402. See also Stephen J, who commented that "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" (ibid at 396). L Zines, The High Court and the Constitution (3rd ed 1992) at 319; P J Hanks, above n 40 at 474; Australian Postal Commission v Dao (1985) 63 ALR 1 at 33-34 per McHugh JA. (1947) 74 CLR 509. Ibid at 521 (emphasis added). R D Lumb, The Constitution of the Commonwealth of Australia Annotated (4th ed 1986) at 3523. (1947) 74 CLR 509. 1996 Section 64 of the Judiciary Act 99 Victoria, the terms and effect of that contract may have to be sought in the Goods Act 1928 (Vic) ... 53 If it is accepted that Cigamatic did establish the Commonwealth's immunity from State law, then the explanation for the "affected by" doctrine stated by Fullagar J in Commonwealth v Bogle is similar to the s 64 view - that State laws "affect" the Commonwealth as a matter of Commonwealth law. If this view of the "affected" doctrine were accepted, it would seem that s 64 is simply declaratory of the common law position - as the words "as nearly as possible" in s 64 suggest. 54 In summary, whatever the intentions of the original legislators, s 64 has been given a dual role in relation to common law and statutory liabilities. It clearly goes beyond the removal of common law immunities and affects both the presumed immunity of the Crown from the application of statutes55 and the doctrine of intergovernmental immunities. Unlike its United States counterpart, it has not been used to create a federal common law or set of principles applicable in the federal jurisdiction. 56 This is an important point in evaluating the constitutional argument, for the role which the courts have attributed to s 64 cannot be explained by that argument. Section 64 has been used to subject the Commonwealth to a State statute which became the basis for an action in tort for breach of statutory duty. In Strods v Commonwealth,57 for example, which was an action for the tort of breach of statutory duty, it was held that the Factories Shops and Industries Act 1962 (NSW) bound the Commonwealth not by its own force but by virtue of s 64 of the Judiciary Act. Section 64 of the Judiciary Act thus enabled the Crown's presumptive immunity from statute to be avoided. However it has been established by a series of cases that s 64 only operates when there are no constitutional impediments. It will not, for example, operate in the face of s 109 of the Constitution. In Deputy Commissioner of Taxation v Moorebank,58 which was concerned with the liability of an individual to taxation, the reluctant taxpayer claimed that a State Limitation Act, which applied by virtue of s 64 of the Judiciary Act, prevented the bringing of a claim against him by the Commonwealth. It was decided that s 109 of the Constitution prevented the exercise of a Commonwealth power from being affected by a State Limitation Act. 59 Choice of law issues In Commonwealth v Bogle, Fullagar J, in the passage cited above, referred to s 56 of the Judiciary Act as the source of the power of the Victorian legislature to make the Commonwealth liable in tort. Passages in other cases suggest that it is the operation of ss 79 and 80 of the Judiciary Act which make the Commonwealth subject to a State 53 54 55 56 57 58 59 [1953] HCA 10; (1953) 89 CLR 229 at 259-60. See also Federal Commissioner of Taxation v Official Liquidator of EO Farley Ltd (Farley's case) [1940] HCA 13; (1940) 63 CLR 278 at 308 per Dixon J. See the discussion below at 115-116 of the meaning of those words in s 64. Bropho v State of Western Australia [1990] HCA 24; (1990) 171 CLR 1. See P Hogg, Liability of the Crown (1st ed 1971) at 224-226. [1988] HCA 29; [1982] 2 NSWLR 182. (1988) 165 CLR 55. See also Deputy Commissioner of Taxation v DTR Securities Pty Ltd [1988] HCA 28; (1988) 62 ALJR 376; Dao v Australian Postal Commission [1987] HCA 13; (1987) 61 ALJR 229; Gilvarry v Commonwealth (1995) 127 ALR 721. 100 Federal Law Review Volume 24 law. 60 There are two sources of choice of law in the Judiciary Act. First, ss 79, 80 and 80A in Part XI ("Supplementary Provisions", Division 2 - Application of Laws) provide choice of law rules for courts exercising federal jurisdiction. That is to say, they provide which body of law is to apply to a court which has properly assumed jurisdiction. 61 Section 79 makes applicable the law of the State in which a court is sitting62 and s 80 applies English common law as modified by statute. Section 80A applies the same rules to courts of a Territory hearing claims against the Commonwealth under s 56 of the Judiciary Act. These sections apply a system of law rather than particular laws from within that system. 63 The latter function is the province of s 64 of the Judiciary Act. The difference between choosing an applicable system of law and applying a particular rule from within the system was explained by Gibbs J in Maguire v Simpson 64 when he said: 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 ap~licable to the Commonwealth as though it were a subject, and therefore binds the Bank. 5 Sections 79 and 80 of the Judiciary Act were intended to fill the gap of applicable law in cases where federal jurisdiction is exercised. 66 Generally, they will apply where there is no Commonwealth statute or constitutional provision which applies, that is, where the federal law is insufficient. 67 In practice, s 79 is the most relevant provision. In some circumstances where a choice of law issue arises in actions brought in State courts, s 79 of the Judiciary Act will apply the lex fori. 68 Section 79 has been interpreted as applying not only the substantive common and statute law of a State,69 but also the 60 61 62 63 64 65 66 67 68 69 Federal Commissioner of Taxation v Official Liquidator of EO Farley Ltd (Farley's case) [1940] HCA 13; (1940) 63 CLR 278 at 308 per Dixon J; Uther v Federal Commissioner of Taxation [1947] HCA 45; (1947) 74 CLR 508 at 528 per Dixon J. For a discussion of this matter, see Pavich v Bobra Nominees Pty Ltd (1988) 84 ALR 285 per French J; J H C Morris, Dicey's Conflict ofLaws (1958) at 7-8. Section 79 cannot apply a State law which would extend the meaning of the statute beyond the limits of principles of construction or of the Constitution. See Commissioner of Stamp Duties (NSW) v Owens (No 2) [1953] HCA 62; (1953) 88 CLR 168; Trade Practices Commission v Manfal Pty Ltd (1990) 92 ALR 416 at 418 per Lee J; (1990) 97 ALR 231 (Full Ct Fed Ct); HE Renfree, Federal Judicial System in Australia (1984) at 305; Pedersen v Young [1964] HCA 28; (1964) 110 CLR 162 at 165. See also John Robertson & Co Ltd (in liq) v Ferguson Transformers Pty Ltd [1973] HCA 21; (1973) 129 CLR 65. P Hogg, above n 56 at 226; E Campbell, "Suits between the Governments of a Federation" [1971] SydLawRw 1; (1971) 6 Syd LR 309, 326; C Howard, "Some Problems of Commonwealth Immunity and Exclusive Legislative Powers" (1972) 5 FL Rev 31 at 34. [1977] HCA 63; (1976) 139 CLR 362. Ibid at 377. See also South Australia v Commonwealth [1962] HCA 10; (1962) 108 CLR 130 at 140 per Dixon J. This generally refers to jurisdiction conferred under s 77(iii) of the Constitution. See below at 104-105. P D Phillips, "Choice of Law in Federal Jurisdiction" [1961] MelbULawRw 21; (1961) 3 Melb Univ LR 170; M Pryles and P Hanks, Federal Conflict of Laws (1974) at 192. Commonwealth v Dixon (1988) 13 NSWLR 601. Uther v Federal Commissioner of Taxation (1947) 74 CLR 509; L Grollo & Co Pty Ltd v Nu Statt Decorating Pty Ltd (in liq) (1980) 4 ACLR 907; Trade Practices Commission v Manfal Pty Ltd (1990) 92 ALR 416. See P D Phillips, above n 67; R W Harding, "Common Law, Federal and Constitutional Aspects of Choice of Law in Tort" (1965) 7 UWALR 196. Cf B O'Brien, "The Law Applicable in Federal Jurisdiction" [1976] UNSWLawJl 8; (1976) 1 UNSWLJ 327. 1996 Section 64 of the Judiciary Act 101 State's choice of law rules. 70 The current position in Australia is that the rule in Phillips v Eyre71 applies as the common law choice of law rule in tort. 72 Under this rule, a plaintiff will succeed in a tort action only if he or she would be successful under both the lex fori and the lex loci delicti. Section 79 thus preserves the common law position. Section 64's role in supplying substantive rights is consistent with these choice of law provisions in the Judiciary Act. 73 In addition there is now substantial authority 74 that in claims in tort in the federal jurisdiction where s 56 of the Judiciary Act applies, the choice of law is governed by that section and that it refers to the lex loci delicti. That view is said to flow as a matter of intention from the invocation of federal jurisdiction. 75 If that view is correct, the law of" the place where the tort was committed will apply by virtue of s 56 and it is unnecessary to refer to s 64. The choice of law provisions (ss 56 and 79) tend to discount the constitutional argument as they suggest that the question of choice of law depends on the intention of the Commonwealth Parliament. Section 79 frequently applies in conjunction with s 64, but a different result may be obtained by applying s 56. 76 Rights to proceed The next important point in considering the context of s 64 is that ss 56-59 of the Judiciary Act either alone or in conjunction with s 64 appear to confer "rights to proceed" in the matters specified in ss 75(iii) and (iv) of the Constitution. The power to enact ss 56-59 seems to derive from s 78 of the Constitution. Section 78 provides: 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. Section 75(iii) of the Constitution confers original jurisdiction on the High Court of Australia in all matters in which the Commonwealth or a "person suing or being sued on behalf of the Commonwealth, is a party". Section 75(iv) gives the High Court original jurisdiction in matters between States, between residents of different States, or between a State and a resident of another State. Section 78 was included in the Constitution to clarify the removal of the Commonwealth's immunity.77 Aitken's reasoning in favour of the constitutional argument focuses upon uncertainty as to the scope, meaning and function of s 78 of the Constitution. Is it the source of rights to proceed in tort and contract (that is, is it tied to the operation of ss 56-59 of the Judiciary Act) or does the fact that s 64 has been read separately from 70 71 72 73 74 75 76 77 For example, Musgrave v Commonwealth [1936] HCA 80; (1937) 57 CLR 514; Parker v Commonwealth [1965] HCA 12; (1965) 112 CLR 295 at 306 per Windeyer J; Deputy Federal Commissioner of Taxation v Brown [1958] HCA 2; (1958) 100 CLR 32 at 39. (1870) LR 6 QB 1. McKain v Miller & Co (South Australia) Pty Ltd (1991) 174 CLR 1; Stevens v Head (1992) 176 CLR433. P Hogg, above n 56 at 226-230. Suehle v Commonwealth [1967] HCA 13; (1967) 116 CLR 353; Breavington v Godleman [1988] HCA 40; (1989) 169 CLR 41; Commonwealth v Mewett [1994] FCA 1444; (1995) 126 ALR 391. Musgrave v Commonwealth [1936] HCA 80; (1937) 57 CLR 514 at 547-548; Commonwealth v Dinnison (1995) 129 ALR 239 at 244. Commonwealth v Mewett [1994] FCA 1444; (1995) 126 ALR 391; cf Gilvarry v Commonwealth (1995) 127 ALR 721. See above n 26. 102 Federal Law Review Volume 24 ss 56-59 as going beyond removing governmental immunity in tort or contract (whilst at the same time s 56 has been limited to removal of the Commonwealth's immunity) mean that the reach of s 78 rights to proceed extends to any "matter" within the original jurisdiction of the High Court as set out in ss 75 and 76 of the Constitution?78 Section 76 of the Constitution provides for the express conferral of additional original jurisdiction on the High Court. The corollary of linking s 78 to the Judiciary Act is that rights to proceed can be removed by legislation. This controversy is a "red herring" to a large extent because s 78 of the Constitution may not be the exclusive source of the power to confer "rights to proceed".79 Certainly the background to the drafting of the clause showed that it was intended to clarify the removal of the Commonwealth's common law immunities. It was accepted that a mere grant of jurisdiction was not sufficient to remove those immunities. But "rights to proceed", particularly in claims outside tort or contract, could also be supported by a combination of s 61 (the executive power) and s 51(xxxix) (the express incidental power), or some other heading of s 51. 80 The High Court has assiduously avoided a definitive statement of the scope of s 78. It is implicit in the expanded role that has been attributed to s 64 that the "rights to proceed" can be found in a variety of Commonwealth legislative sources but that liability is not entrenched by the Constitution. FEDERAL JURISDICTION AND VENUE Before considering the application of s 64, there are some more preliminary details about the source of federal jurisdiction which need to be explained. The Const~.tution and the Judiciary Act make provision, sometimes overlapping, for the matters which come within federal jurisdiction and the designation of venue. Federal jurisdiction has been described as authority to adjudicate derived from the Commonwealth Constitution and laws. 81 Sometimes the issue may arise whether a court is indeed exercising federal jurisdiction and whether other provisions of the Judiciary Act, such as s 64, apply to proceedings. 82 The provisions in the Constitution which confer jurisdiction appear in Chapter III under the heading "The Judicature". Chapter III is an expression of the separation of powers which the Constitution implies and contains provisions about the judicial power of the Commonwealth. In interpreting Chapter III, the High Court has consistently displayed two broad concerns. The first is to preserve the special nature of the judicial power by ensuring that only properly constituted courts exercise the 78 79 80 81 82 This was the recommendation of the Final Report of the Constitutional Commission (1988) at para 6.285. Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254 at 263. Commissioner for Railways for State of Queensland v Peters (1991) 102 ALR 579; Mutual Pools [1994] HCA 9; (1993) 179 CLR 155. PH Lane, Commentaries on the Australian Constitution (1986) at 351; HE Renfree, above n 62 at 534; Western Australian Psychiatric Nurses' Association (Union of Workers) v Australian Nursing Federation (1991) 102 ALR 265 at 272 per Lee J. For example, China Ocean Shipping Co & Others v State of South Australia (1979) 145 CLR 172; 27 ALR 1 (held: admiralty jurisdiction was conferred by Merchant Shipping Act 1894 (UK), not by s 39(2) of the Judiciary Act, and that therefore s 64 of the Judiciary Act was not applicable); Commonwealth v Mewett [1994] FCA 1444; (1994) 126 ALR 391. 1996 Section 64 of the Judiciary Act 103 power,83 and secondly to ensure that the provisions which confer jurisdiction are read broadly. That last point is illustrated by the fact that the courts have assumed that the references to "States" and the "Commonwealth" in the Judiciary Act bear the same meaning as in ss 75(iii) and (iv) of the Constitution. 84 In relation to the Commonwealth it was accepted in Maguire v Simpson 85 that, for the purposes of s 64 of the Judiciary Act, the reference to the "Commonwealth" includes "persons suing or being sued on behalf of the Commonwealth" as in s 75(iii) of the Constitution. In that case, the Commonwealth Trading Bank sued a customer in the Supreme Court of New South Wales. Jacobs J, who specifically considered the issue, thought that the reference to the Commonwealth in s 78 of the Constitution should be taken as including a person suing or being sued on behalf of the Commonwealth, and that s 64 of the Judiciary Act should be construed in the same manner. 86 In relation to States, it has been accer,ted that the same meaning applies to the Judiciary Act as to s 75 of the Constitution. 7 In Crouch v Commissioner for Railways,88 Gibbs CJ referred to Maguire v Simpson 89 and said: "Logically it must follow that the words 'a State' could have a similarly wide meaning"90 for the purpose of s 75(iv).91 Thus s 64 has a potentially broad reach. The important point for my argument is that the provisions which confer jurisdiction are tied to the judicial power of the Commonwealth. This assists in understanding the special nature of "federal jurisdiction" and points to the distinction between jurisdiction and causes of action. Sections 56-59 in Part IX of the Judiciary Act, which provide for suits by and against the Commonwealth and the States, and for the venue of such suits, appear to be an expression of the original jurisdiction of the High Court conferred by ss 75(iii) and (iv) of the Constitution. Sections 56-59 should be read together with ss 38 and 39 of the Judiciary Act. These sections appear in Part VI of the Act under the heading "Exclusive and Invested Jurisdiction". Section 38 provides that, subject to the remittal power in s 44 of the Judiciary Act,92 the jurisdiction of the High Court shall be exclusive93 in 83 84 85 86 87 88 89 90 91 92 For example, Brandy v Human Rights and Equal Opportunity Commission [1995] HCA 10; (1995) 183 CLR 245. For example, State Bank of New South Wales v Commonwealth Savings Bank of Australia (State Bank case) [1986] HCA 62; (1986) 161 CLR 639; Breavington v Godleman [1988] HCA 40; (1989) 169 CLR 41; Commissioner for Railways of Queensland v Peters [1977] HCA 63; (1991) 102 ALR 579. (1976) 139 CLR 362. Ibid at 404. State Bank case [1986] HCA 62; (1986) 161 CLR 639. (1985) 159 CLR 22. (1976) 139 CLR 362. (1985) 159 CLR 22 at 32. In some instances there may be differences in the extent of liability of an instrumentality depending upon whether s 64 applies. If the constating statute of an instrumentality provides it with rights, they may conflict with those arising under s 64 of the Judiciary Act. In other situations where the liability of a State or its instrumentality is in issue, there may be differences between its liability under State Crown proceedings legislation and under the Judiciary Act: see, eg, Downs v Williams [1971] HCA 45; (1972) 126 CLR 61. This power was discussed in Johnstone v Commonwealth [1979] HCA 13; (1979) 143 CLR 398, in which it was held that a negligence action against the Commonwealth arising from acts which occurred in South Australia could be remitted from the High Court to the Supreme Court of New South Wales, although the Supreme Court of New South Wales did not have jurisdiction to hear the action under s 56 of the Judiciary Act. In other words, the High Court decided that 104 Federal Law Review Volume 24 suits between States (or between persons suing or being sued on behalf of different States)94 and in suits between the Commonwealth and States (or between persons suing or being sued on their behalf).95 These provisions are consistent with ss 57 and 59 of the Judiciary Act in requiring that the High Court be the venue for such claims. Section 58 of the Judiciary Act (claims against States), which provides that the venue for claims is either the High Court or a State Supreme Court, is thus qualified by ss 38(b) and (c) when the claim is brought by the Commonwealth. 96 If a claim is brought by an individual resident of another State, then s 38 does not apply. In such case, a State Supreme Court could exercise jurisdiction either pursuant to s 39(2) of the Judiciary Act, which is also in Part VI of the Act under the sub-heading "Federal jurisdiction of State Courts in other matters", or pursuant to s 56 of the Judiciary Act. Section 56 of the Judiciary Act, which deals with claims by a "person" against the Commonwealth, provides that the venue for claims against the Commonwealth shall be either the High Court, the Supreme Court of the State or Territory "in which the claim arose", or any other court of competent jurisdiction of the State or Territory "in which the claim arose".97 There is a potential for conflict between s 39(2) of the Judiciary Act and s 56, as the decision of Breavington v Godleman98 (discussed below) shows. This is because it can be argued that a State could submit to the jurisdiction of another State Supreme Court. The power to "define jurisdiction" as described above arises from s 77 of the Constitution, in relation to s 75 and s 76 "matters". Section 3999 of the Judiciary Act is a provision of general operation enacted under s 77(iii), which gives the power to invest State courts with federal jurisdiction. lOO Section 39(2) provides, subject to the High Court's exclusive jurisdiction and other limits, that State courts be invested with federal jurisdiction in all matters in which the High Court has original jurisdiction. Section 39 was passed with the object of ensuring, as far as possible, that cases of a constitutional nature should be finally decided in the High Court. lOl The terms of ss 75 and 76 of the Constitution are consistent with the object of s 39 of the Judiciary Act; they seem to be directed at "matters" which could be described as raising "federal", "constitutional" or "inter-State" issues. l02 The authority to adjudicate conferred by ss 56-59 and ss 38-39 of the Judiciary Act is in relation to the "matters" referred to in ss 75 and 76 of the Constitution. "Federal jurisdiction", in the context of s 77 of the Constitution, means the authority to adjudicate which is conferred by federal law and which concerns a the exercise of jurisdiction under s 56 of the Judiciary Act was not a pre-condition to the remittal of a matter under s 44. 93 These provisions appear to be enacted under s 77(ii) of the Constitution. 94 Judiciary Act 1903 (Cth), s 38(b). 95 Judiciary Act 1903 (Cth), s 38(c), (d). 96 In Commonwealth v New South Wales (1923) 52 CLR 20, it was held that the word "person" in s 58 included the Commonwealth. 97 See also s 77(i) of the Constitution, which contains a general power to define the jurisdiction of any federal court. 98 [1988] HCA 40; , (1989) 169 CLR 41. 99 For a discussion of s 39, see H E Renfree, above n 62, ch 4. 100 Commissioner for Railways for State of Queensland v Peters (1991) 102 ALR 579. 101 HE Renfree, above n 62 at 541. 102 Cf E Campbell, above n 63 where it is suggested that s 75(iii) refers to inter-governmental, not necessarily constitutional, matters. 1996 Section 64 of the Judiciary Act 105 "matter" in s 75 or s 76 of the Constitution. l03 The whole scheme of the legislation suggests that the description of those matters is intended to define the ambit of federal jurisdiction rather than to prescribe causes of action available against defendants sued in the federal jurisdiction. JURISDICTION AND CAUSE OF ACTION: A FUNDAMENTAL DISTINCTION Aitken argues that S5 75(iii) and (iv) of the Constitution have the "dual function" of both conferring jurisdiction on courts exercising federal jurisdiction and being the source of substantive liability.l04 In support of that view he relies largely upon the decision in Commonwealth v New South Wales. 105 In this section it is argued that that decision does not support his argument. The distinction between "jurisdiction", meaning "authority to adjudicate"106 or authority to decide a case,107 and the existence of a cause of action, is fundamental. There is a logical distinction between the role of a court in determining whether facts proved establish a cause of action, and the conferral of jurisdiction on a court to hear a matter. The existence of a cause of action is separate from the conferral of jurisdiction.lOB The above distinction is particularly vital in this contextl09 for two reasons. First, because the Constitution and the Judiciary Act make elaborate provision for the conferral of federal jurisdiction as an expression of tIle judicial power of the Commonwealth, these jurisdiction-conferring provisions are clearly intended to be just that. The cause of action may arise from the common law (which can be read broadly as including equitable principles) or from statute, but it lo~ically exists apart from the authority to decide a matter, or indeed to grant a remedy.l 0 Indeed, the whole history of the passage of legislation to do with proceeding against the Crown shows that the procedural reform to the petition of right led to substantive change in the common law. lll The scope of s 64 determines what causes of action arise in the federal jurisdiction. The second feature of this context which points to the need for distinguishing between causes of action and jurisdiction is that the cases in which s 64 has been used 103 PH Lane, A Manual of Australian Constitutional Law (4th ed 1987) at 351. 104 L Aitken (1992), above n 12 at 484. See also L Aitken, "Jurisdiction, Liability and 'Double Function' Legislation" (1990) 19 FL Rev 31. 105 [1923] HCA 23; (1923) 32 CLR 200. 106 P H Lane, above n 103 at 351; HE Renfree, above n 62 at 534. 107 E Campbell, above n 63. lOB The fundamental distinction between jurisdiction and substantive or procedural rights was recognised in the High Court decision in Deputy Commissioner of Taxation v Richard Walter Pty Ltd [1995] HCA 23; (1995) 69 ALJR 223 at 227 per Mason CJ, at 242-433 per Deane and Gaudron JJ, at 109 Contrast the tendency in the context of jurisdictional error and judicial review to merge the concepts of jurisdictional and non-jurisdictional error. But in that context there is a concern to preserve the jurisdiction of the courts to review all errors of law: Re Gray; Ex parte Marsh (1985) 157 CLR 357 at 371 per Gibbs CJ. Note that in L Aitken, above n 104, the distinction between jurisdiction to grant a remedy and jurisdiction to decide or to hear a matter is not made. Farnell v Bowman (1887) 12 App Cas 643. 251 per Dawson J, at 258 per Toohey J and at 264 per McHugh J. 110 111 106 Federal Law Review Volume 24 to impose a substantive l12 civil liability upon a public authority all arose from a primary obligation in tort or contract. In the context of actions in tort, the courts have consistently made it clear that the existence of a cause of action cannot be confused with the obligations which might be enforced against a defendant in public law, since the cause of action or primary obligation must arise under the private law. 113 By corollary, the conferral on a court of the right or jurisdiction to grant a remedy in public law does not give the right to award damages for breach of a "private" law obligation. 114 The co-existence of ss 75(iii) and (v) of the Constitution, under which a remedy in the nature of prohibition, mandamus or injunction may be sought against an "officer of the Commonwealth" in conjunction with a claim for damages, might be thought to test this argument. But discussion of these provisions by McHugh J in Georgiadis l15 endorses the view that they are basically directed at the jurisdiction of the High Court and that s 75(iii) is not the source of liability. The distinction between the existence of a cause of action or rights to proceed and jurisdiction or authority to adjudicate was raised in Commonwealth v New South Wales. 116 That case involved an action for damages by the Commonwealth against the State of New South Wales, as a result of a collision between a New South Wales steamship and a Commonwealth motor launch. The issue was whether the Commonwealth could bring a High Court action against the State without its consent. For the State, it was argued that it had a prerogative right not to be sued without its consent unless jurisdiction had been given by s 75, together with an enactment pursuant to s 78 of the Constitution, conferring the right to proceed against the State. It was argued that the reference in s 58 of the Judiciary Act to "any person making a claim against a State" was not intended to refer to the Commonwealth. The majority of the High Court accepted the latter point but rejected the s 78 argument. They said that it was only necessary to refer to s 75(iii) of the Constitution to find a right to proceed against the State. In other words, it was held that both jurisdiction to entertain an action in tort against the State and the right to proceed without its consent were conferred by s 75(iii). It is important to note that this was an action in tort and the liability of the State as such was not in issue. Rather it was a question of whether the State was properly named as a defendant. So the existence of a cause of action was not in issue - the State's liability to the Commonwealth might have arisen from its own Crown Proceedings legislation. 117 The decision does not support the dual function approach except in that limited context. The reasoning of the majority can be explained as a decision to avoid reading s 78 of the Constitution too broadly.t 18 Section 64 has also been used to provide procedural rights, eg, Commonwealth v Miller [1910] HCA 46; (1911) 10 CLR 742 (discovery). 113 For exampl~, Rowling v Takaro Properties Ltd [1988] 1 All ER 162; Jones v Department of Employment [1988] 1 All ER 725; Sutherland Shire Council v Heyman (1985) 157 CLR 564. 114 For example, Park Oh Ho v Minister for Immigration and Ethnic Affairs [1989] HCA 54; (1990) 167 CLR 637 (no award of damages under the "necessary to do justice" provisions in s 16 of the Administrative Decisions Gudicial Review) Act 1977 (Cth». Aitken suggests that adopting a "double function" approach would allow such relief: L Aitken, above n 104 at 32. 115 (1993) 179 CLR 297 at 325-326. 116 [1923] HCA 23; (1923) 32 CLR 200. 117 Similar reasoning was employed by Dixon J in Werrin v Commonwealth [1938] HCA 3; (1938) 59 CLR 150, discussed below at 107-108. 118 G Donaldson, above n 25 at 144. 112 1996 Section 64 of the Judiciary Act 107 In a separate judgment, Higgins J decided that the source of the Commonwealth's right to sue the State was s 58 of the Judiciary Act, the scope of which as a matter of statutory interpretation included the Commonwealth as a plaintiff. He suggested that s 58 had been enacted pursuant to s 78 of the Constitution. 119 Although there was subsequent authority which supported the majority view in Commonwealth v New South Wales, there was also much criticism of it and support for the alternative view put forward by Higgins J in that case. 120 It was suggested, for example, that if the view of the majority in Commonwealth v New South Wales were accepted, it would have the effect of entrenching the Commonwealth's liability in tort in the Constitution and no legislation of the Commonwealth could dero~ate from that liability.121 As was pointed out by McHugh J in the Mutual Pools case,12 the view of the majority has never been overruled. In Werrin v Commonwealth,123 an action for refund of tax paid under mistake of law, the corollary of Commonwealth v State of New South Wales was successfully argued: that the effect of s 75(iii) was not to entrench substantive rights, and that therefore a statute banning recovery could apply.124 Dixon J attempted to explain the decision in Commonwealth v State of New South Wales on two grounds. He said first that the case came before the court on a motion to set aside the writ for want of jurisdiction. Therefore no question of substantive liability arose, only the question of whether the court had jurisdiction to entertain the suit and determine the liability, a jurisdiction which it clearly had under s 75. 125 Secondly, the decision could be explained on the basis that as the State of New South Wales had enacted Crown proceedings legislation it had abandoned its immunity.126 He continued: Probably the joint judgment of Isaacs, Rich and Starke JJ was not intended as a pronouncement that the liability of the State within Federal jurisdiction and of the Commonwealth was imposed directly by the Constitution so as to be unalterable and indestructible by legislation. It might be remembered that the question to which the 119 [1923] HCA 23; (1923) 32 CLR 200 at 220-221. 120 The decision in Commonwealth v New South Wales [1923] HCA 23; (1923) 32 CLR 200 was approved in the following decisions: New South Wales v The Commonwealth (No 1) [1932] HCA 7; (1932) 46 CLR 155 at 210, 211 and 215; New South Wales v Bardolph [1934] HCA 74; (1934) 52 CLR 455 at 458-9; Heinemann v Commonwealth [1935] HCA 73; (1935) 54 CLR 126 at 129; Musgrave v Commonwealth [1936] HCA 80; (1937) 57 CLR 514 at 550 per Evatt and McTiernan JJ; South Australia v Commonwealth [1962] HCA 10; (1962) 108 CLR 130 at 148. Decisions which establish that s 75(iii) does not create liability in tort include: Werrin v Commonwealth [1938] HCA 3; (1938) 59 CLR 150 at 167 per Dixon J, approved by Windeyer J in Suehle v. Commonwealth [1967] HCA 13; (1967) 116 CLR 353 at 355; Asiatic Steam Navigation Co Ltd v Commonwealth [1956] HCA 82; (1956) 96 CLR 397 at 422-423 per Fullagar J; Washington v Commonwealth (1939) 39 SR (NSW) 133 at 140 per Jordan CJ. The weight of academic opinion supports the proposition that s 75(iii) is a procedural or jurisdictional section only: P Hogg, above n 56 at 215-6; PH Lane, The Australian Federal System (2nd ed 1979) at 531-2; M Pryles and P Hanks, above n 67; HE Renfree, above n 62 at 162-9; G Donaldson, above n 25 at 144; Z Cowen and L Zines, Federal Jurisdiction in Australia (2nd ed 1978) at 32-38. See also Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254 at 269 per Brennan J (dissenting). Musgrave v Commonwealth [1936] HCA 80; (1937) 57 CLR 514 at 546 per Dixon J. [1994] HCA 9; (1994) 179 CLR 155 at 217. See also L Aitken (1992), above n 12 at 491. [1938] HCA 3; (1938) 59 CLR 150. See M Pryles and P Hanks, above n 67 at 186. [1938] HCA 3; (1938) 59 CLR 150 at 166. Ibid. 121 122 123 124 125 126 108 Federal Law Review Volume 24 material parts of the judgment are directed is the actionable liability of the Crown for tort and this is a subject upon which the distinction between procedure and substantive law has never been steadily maintained, at all events in the manner in which the Crown's immunity has been stated and explained.... Farnell v Bowman [(1887) 12 App. Cas. 643] is based upon the view that the grant of a general remedy against the Crown makes the torts committed on its behalf actionable. Implicit in this view appears to be the assumption that the Crown's substantive responsibility existed in contemplation of law but had not been the subject of legal remedy. If this mode of reasoning is applied, it is easy to understand how sec. 75 should be considered enough to expose the State and the Commonwealth to a remedy for tortious liability. It treats the liability as already existing in abstracto as a duty of imperfect obligation and made perfect by the creation of a jurisdiction in which the Crown may be sued without its consent. But it would not mean that the substantive liability was itself created and imposed by the Constitution. 127 This passage seems to recognise that on the facts of Commonwealth v New South Wales, the conferral of jurisdiction by s 75(iii) eliminated the procedural difficulty.128 The case does not support the proposition that conferral of jurisdiction under s 75(iii) of the Constitution removes the immunity of the Commonwealth or a State in tort. 129 As McHugh J explained in the Mutual Pools case, Commonwealth v New South Wales does not establish that s 75(iii) is the source of liability but rather that the inclusion of the action in s 75(iii) enables actions to be brought to challenge the scope of powers conferred by that section. 130 The decision in Breavington v Godleman 131 is relied upon by Aitken to support his argument against the use of s 64 of the Judiciary Act. 132 He suggests that the decision shows the difficulty in reconciling the "minutiae" of s 64. As the discussion which follows shows, that case gives firm support to the distinction between the conferral of jurisdiction and the existence of a cause of action. Breavington v Godleman 133 involved an action brought in the Supreme Court of Victoria arising from a motor accident which had occurred in the Northern Territory. The claim was covered by s 56 of the Judiciary Act because it was accepted that the third defendant, the Australian Telecommunications Commission (Telecom) was the "Commonwealth" for the purposes of that section. On the facts the venue was important because a choice of law issue arose. Under the Motor Accidents (Compensation) Act 1979 (NT), a claim for economic loss was barred, whereas in Victoria common law principles applied. The High Court in Breavington v Godleman held that s 56 did not preclude the litigation being heard in the Supreme Court of Victoria, although it decided that the law of the 127 128 This passage was approved by Mason CJ in Deputy Commissioner of Taxation v Richard Walter Pty Ltd [1995] HCA 23; (1995) 69 ALJR 223 at 227, when he explained (re s 75(v»: "The provision is not a source of substantive rights except in so far as the grant of jurisdiction necessarily recognises the principles of general law according to which the jurisdiction to grant the remedies mentioned is exercised". Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 404 per Jacobs J; Z Cowen and L Zines, above n 120 at 32-38; H E Renfree, above n 62 at 162-9. Cf L Aitken (1992), above n 12 at 487-489. [1994] HCA 9; (1994) 179 CLR 155 at 217. [1988] HCA 40; (1989) 169 CLR 41. L Aitken (1992), above n 12 at 497-500. [1988] HCA 40; (1989) 169 CLR 41. Ibid at 167-168 (emphasis added). 129 130 131 132 133 1996 Section 64 of the Judiciary Act 109 Northern Territory applied.l 34 As, on the facts, Telecom had not objected to the jurisdiction of the Supreme Court, s 39(2) prevailed over s 56. Breavington v Godleman showed the potential conflict between ss 56 and 39(2) of the Judiciary Act which arises because s 56 provides that the venue for claims against the Commonwealth should be the High Court or a court of the State or Territory in which the claim arose, whereas s 39(2) invests State courts generally with federal jurisdiction. In other words, one issue was whether s 56, a specific provision, prevailed over s 39(2), a general and ambulatory135 provision. The rule with respect to the interpretation of statutes is that a general provision gives way to a specific provision. 136 Section 56 and s 39(2) both appear to be provisions investing State and other courts with federal jurisdiction pursuant to s 77(iii) of the Constitution. It has been suggested that s 77(iii) may be the source of power for more than one law investing State courts with federal jurisdiction.137 The High Court, however, interpreted s 56 of the Judiciary Act as merely "qualifying or restricting"138 s 39(2) of the Judiciary Act rather than "limiting or curtailing" it. 139 To have interpreted the sections otherwise, as three of the judges said,140 would be to deprive the States of jurisdiction invested under s 39(2). Section 56, said the High Court, was not a provision which invested jurisdiction in the High Court or in the courts of States in actions against the Commonwealth. 141 That, said Mason CJ, is the function of s 75(iii) of the Constitution and s 39(2) of the Judiciary Act. 142 That view, which was shared by the other judges, was based upon a comparison of ss 56 and 39(2) of the Judiciary Act. Wilson and Gaudron JJ, for example, relied upon the language of ss 39(2) and 56, and the difference between the headings of the Act under which they appeared. 143 They suggested that Part VI ("Exclusive and Invested Jurisdiction") was referable to s 77 of the Constitution, whereas Part IX ("Suits by and against the Commonwealth") was probably referable to s 78. 144 The "permissive" language of s 56, they thought, enabled a plaintiff to select the Supreme Court of the State in which the action arose. 145 The result of this aspect of the case is summed up in the words of Toohey J: In the present case s 39(2) operates to confer jurisdiction on the Supreme Court of Victoria to entertain a claim against the Commonwealth. Notwithstanding s 56, the 134 Four judges (Wilson, Gaudron, Brennan and Dawson JJ) decided that s 56 provided the 135 136 137 138 139 140 141 142 choice of law: [1988] HCA 40; (1989) 169 CLR 41 at 101, 118 and 141. P H Lane, above n 103 at 344-5. DC Pearce and R S Geddes, Statutory Interpretation in Australia (3rd ed 1988) at para 2.5-2.9. H E Renfree, above n 62 at 537; P H Lane, above n 103 at 343. [1988] HCA 40; (1989) 169 CLR 41 at 69 per Mason CJ. Ibid. Ibid at 102 per Wilson and Gaudron JJ and 140 per Deane J. Ibid at 68 per Mason CJ and 118 per Brennan J. Ibid at 68, following the decision in Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254. See also [1988] HCA 40; (1989) 169 CLR 41 at 102 per Wilson and Gaudron JJ and at 140 per DeaneJ. 143 Ibid at 100-101. 144 Ibid at 104. 145 Ibid at 104 and 118 per Brennan J. See also at 140 per Deane J. 110 Federal Law Review Volume 24 Commonwealth may submit to the jurisdiction of the Court and that is what it has done in the present case. 1ii6 The High Court left open the question whether s 56 is the source of the ~ommonwealth's liability in tort either alone or in conjunction with s 64 of the Judiciary Act and perhaps ss 75(iii) and 78 of the Constitution. All of the seven judges touched on the issue in passing. Four judges appeared to approve the suggestion that s 56 is the source of the Commonwealth's liability in tort. 147 But Gaudron and Wilson JJ (with whose view Toohey J seemed to agree) referred to Commonwealth v Evans Deakin Industries Ltd and firmly rejected the view that s 56 rendered the Commonwealth liable in tort. 148 There is thus tentative support for the suggestion that s 56 removes the Crown's immunity in tort but strong support for the view that Part IX of the Judiciary Act is not concerned with matters of jurisdiction; rather it is concerned with causes of action. At the same time it was accepted that s 75(iii) of the Constitution and s 39(2) of the Judiciary Act are concerned with jurisdiction. It is therefore difficult to understand Aitken's conclusion that the decision shows the High Court "groping its way again to the original position in Commonwealth v New South Wales" and that it made "heavJ weather" in explaining the relationship between ss 56, 64 and 39 of the Judiciary Act. 1 9 On the facts, the High Court did not need to explain the relationship any more than it did. THE APPLICATION OF SECTION 64: THE DISTINCTION BETWEEN JURISDICTION AND SUBSTANTIVE LIABILITY MAINTAINED In this section three features of the application of s 64 are demonstrated. First, that s 64 operates to apply statutes between governments by which they might not otherwise be bound. Secondly, that s 64 is applied flexibly to ensure that the liability of instrumentalities is "as nearly as possible" assimilated to private individuals. Thirdly, advancing the argument put forward in this article, the application of s 64 demonstrates a distinction between jurisdiction and causes of action. Applying statutes to the Commonwealth Section 64 was discussed in Maguire v Simpson,150 where an action in contract was brought by the Commonwealth Trading Bank against a customer. It was held that the Limitation Act 1969 (NSW) applied to the bank by virtue of s 64 of the Judiciary Act. It was argued 'that s 64 of the Judiciary Act only ap~lied procedural laws, but five of the six-member High Court rejected that argument. 1 1 The case therefore establishes that s 64 of the Judiciary Act applies both procedural and substantive laws. 152 As the facts did not involve a claim against the Commonwealth, the case did not fall within ss 56-59 of the Judiciary Act, although it did fall broadly within the scope of Part IX of the Act. The case therefore established that s 64 of the Judiciary Act was independent of ss 56146 147 148 149 150 151 152 Ibid at 169. Ibid at 69 per Mason CJ, at 152 per Dawson J, at 118 per Brennan J, at 140 per Deane J. Ibid at 101. Cf ibid at 169 per Toohey J. L Aitken (1992), above n 12 at 500. [1977] HCA 63; (1976) 139 CLR 362. Stephen J characterised s 14(1) of the Limitation Act as a procedural provision: ibid at 392. Cf L Aitken (1992), above n 12 at 492 where it is suggested that the decision "only inferentially touched upon the question of the Commonwealth's substantive liability". 1996 Section 64 of the Judiciary Act 111 59 of the Act in the sense that it is not limited to claims in tort or contract against the Commonwealth or States or instrumentalities. How was s 64 the source of the substantive right to proceed? The majority of the judges accepted that the reason s 64 applies such laws is because "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".153 In the words of Murphy J, the Limitation Act became "surrogate Commonwealth law".154 The Limitation Act applied "by force of Commonwealth law, and not by its own force as a State law".155 In his judgment, Gibbs J expressly adopted the passage from Kitto }'S judgment in Asiatic Steam Navigation Co Ltd v Commonwealth 156 when the latter suggested that s 64 was an independent ground for reaching the decision in that case. Kitto J had said: [Section] 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. 157 The majority reasoning in Maguire v Simpson has been taken to endorse Kitto 1's reasoning. In that passage Gibbs J referred to cases in which State statutes were applied to the Commonwealth in claims in tort,158 suggesting that it was s 64 alone without s 56 that rendered the Commonwealth subject to the State legislation in these cases. 159 The tort claims in those cases came in any event within the scope of s 56, but the comments about s 64 support the view that it applied the statute as a matter of federal law. It is important to note that the statutes in question in those cases affected or modified an existing common law tort liability. They were not statutes which of their own right imposed a direct statutory duty, breach of which could lead to a common law tort liability.160 Two judges in Maguire v Simpson, Barwick CJ and Jacobs J, considered that s 78 of the Constitution authorised the making of a law (that is, s 64 of the Judiciary Act) with respect to substantive rights. 161 Barwick CJ emphasised the historical context of Part IX of the Judiciary Act and the fact that s 78 was enacted to remove the Crown's traditional immunity in tort. He also contrasted s 78 rights with the exercise of federal jurisdiction under s 75 of the Constitution. 162 He said: 153 [1977] HCA 63; (1976) 139 CLR 362 at 373 per Barwick CJ. 154 Ibid at 408 per Murphy J. See also Australian Postal Commission v Dao (1985) 63 ALR 1 at 33 155 156 157 158 per McHugh JA. [1977] HCA 63; (1976) 139 CLR 362 at 377 per Gibbs J. [1956] HCA 82; (1956) 96 CLR 397. Ibid at 424. Pitcher v Federal Capital Commission [1928] HCA 44; (1928) 41 CLR 385 (whether the Compensation to Relatives Act 1897 (NSW) bound the Commission in a claim in tort); Suehle v Commonwealth [1967] HCA 13; (1967) 116 CLR 353 (claim in tort under s 56 of the Judiciary Act); and Asiatic Steam Navigation [1956] HCA 82; (1956) 96 CLR 397 (proceedings in tort by the Commonwealth: whether s 503 of the Merchant Shipping Act 1894 (Imp) enabled the Commonwealth to limit its liability). 228-229. 159 Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 381 per Gibbs J; see also P Hogg, above n 56 at 160 For example, Cutler v Wandsworth Stadium Ltd [1949] AC 398. 161 [1977] HCA 63; (1976) 139 CLR 362 at 370 per Barwick CJ. 162 Ibid at 371. 112 Federal Law Review Volume 24 In my opinion, the Parliament was authorized by s 78 to make a law giving ... a substantive right against the Commonwealth in respect of any matter within the judicial competence of the Commonwealth. 163 This comment about s 78 has been read in two ways. First, it has been read as limiting the operation of s 78 to removal of the Crown's traditional immunity in tort and contract. 164 Secondly, it has been read as extending the operation of s 78 to literally "any matter within the judicial competence of the Commonwealth".165 It is implicit in the Maguire v Simpson reasoning that, as s 64 operated to apply statutes as "surrogate common law", and thus supplied the basis of a cause of action, the distinction between jurisdiction and cause of action was maintained. It is important to note that Barwick CJ was the only judge to refer to the provisions in s 75 of the Constitution and that was in the context of defining the removal of the Crown's traditional immunity and comparing s 75 with s 78. The scope of s 64 was considered further in Commonwealth v Evans Deakin Industries Ltd. 166 In that case it was successfully argued that the Subcontractors' Charges Act 1974 (Qld), which was expressed to bind the Crown in right of the State of Queensland, bound the Commonwealth. The effect of that decision was that the Commonwealth as an employer became directly liable to its contractor's subcontractor. A majority of the High Court rejected the Commonwealth's argument that there needed to be some other law of the Commonwealth which enabled the Commonwealth to be sued before s 64 operated. For the Commonwealth it was argued that s 56 of the Judiciary Act performed that function and as this was not a claim in tort or in contract, s 64 was inapplicable. This argument, said the High Court,167 amounted to a return to the theory rejected in Maguire v Simpson,168 that s 64 does not refer to the substantive rights of the parties. The majority said, relying upon Commonwealth v Anderson, that the Supreme Court is given jurisdiction to entertain a suit to which the Commonwealth is a party by the combined effect of s 39(2) of the Judiciary Act and s 75(iii) of the Constitution. That, they said, was the condition for the operation of s 64. 169 The majority found it "unnecessary" to consider whether s 78 was the sole source of the power to make laws such as s 64 "governing the liability of the Commonwealth".170 In his dissenting judgment, Brennan J (as he then was) suggested that the reasoning of the majority equates a grant of jurisdiction conferred by the combined operation of s 75(iii) of the Constitution and s 39(2) of the Judiciary Act with "rights to proceed". Brennan J's judgment is based upon the distinction between rights to proceed conferred by legislation made under s 78 of the Constitution and the conferring of jurisdiction to entertain a suit. 171 Section 64, he said, is not a law conferring rights to proceed and 163 164 165 166 167 168 Ibid at 370. Georgiadis (1993) 179 CLR 297 at 326 per McHugh J. Commissioner for Railways of Queensland v Peters (1991) 102 ALR 579. See below at 116-119. . [1986] HCA 51; (1986) 161 CLR 254. Ibid at 264. [1977] HCA 63; (1976) 139 CLR 362. (1986) 161 CLR 254 at 264. The majority in the High Court also relied upon China Ocean Shipping Co v South Australia (1979) 145 CLR 172. The issue was whether the Supreme Court of South Australia was exercising a federal jurisdiction. [1986] HCA 51; (1986) 161 CLR 254 at 263. Ibid at 270. 169 170 171 1996 Section 64 of the Judiciary Act 113 cannot operate alone to confer rights to proceed. 172 Brennan J said that for a suit to be validly constituted for the purpose of s 64, two partly coincident elements must be present. The first is that the suit is brought to obtain a remedy which can be granted against the defendant if the relevant facts are established. He described the claim against the Commonwealth as a "novel statutory right".173 The second element is that the suit be brought in a court of competent jurisdiction. 174 The majority reasoning has been criticised175 on the basis that it appears to amount to a reversion to the controversial decision of the majority in Commonwealth v State of New South Wales. 176 Certainly statements in the majority judgment referring to previous authority could be so interpreted. However, on closer examination, they can be explained by arguing that the majority in Commonwealth v Evans Deakin Industries Ltd maintained the distinction between jurisdiction and cause of action. The ma~ority relied in particular upon the statement by Dixon J in Commonwealth v Anderson 17 that "the essential condition of the application of s 64 is the existence of the suit to which the Commonwealth is a party ... ".1 78 To point to that statement as evidence of the blurring of the distinction is to take it out of context. That decision was concerned with whether the Commonwealth could be prevented by the Landlord and Tenant (Amendment) Act, 1948-1958 (NSW) from taking an action in ejectment against its tenant. The terms of the Act expressly excluded the Commonwealth from its operation. It was conceded that the Supreme Court had jurisdiction under s 39(2) of the Judiciary Act. It was decided that the State Act did not apply to the Commonwealth by virtue of s 64. Dixon J said: "[I]t 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."179 The decision was explained by Gibbs J in Maguire v Simpson 180 as follows: 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. 181 It was in other words "a case in which the law which was sought to apply affected the jurisdiction of the court and not the rights of the parties in the court which was exercising the jurisdiction".182 Another view expressed by the majority in Commonwealth v Evans Deakin Industries Ltd appears at first sight to endorse the constitutional argument. 183 This arises from the express disapproval of dicta of McHugh JA (as he then was) in Australian Postal Commission v Dao 184 when he said: 172 173 174 175 176 177 178 179 180 181 182 183 184 Ibid at 271-273. Ibid at 273. Ibid at 269. D Rose, "Government and Contract" in PD Finn (ed), Essays on Contract (1987) 233 at 236. [1960] HCA 85; (1923) 23 CLR 200. (1960) 105 CLR 303. Ibid at 310. Ibid. (1976) 139 CLR 383. Ibid at 384. Ibid. [1986] HCA 51; (1986) 161 CLR 254 at 266-267. (1985) 63 ALR 1. 114 Federal Law Review Volume 24 Section 64 does not create causes of action; it assumes that the plaintiff has a cause of action against the Commonwealth. ... In my opinion, s 64 does not begin to operate as against the Commonwealth until the plaintiff has a cause of action which he can bring against the Commonwealth. 18S McHugh JA's dicta must, however, be read in the context of the facts in Dao's case. The issue in that case was whether the Anti-Discrimination Act 1977 (NSW) bound the Australian Postal Commission against whom a complaint under the Act had been lodged in the New South Wales Equal Opportunity Tribunal. It was decided that the tribunal had no jurisdiction to hear the claim because the New South Wales Act did not bind the Commission. In reaching this decision, Kirby P and Samuels JA relied upon s 52(ii) of the Constitution as the Act conflicted with the exclusive power of the Commonwealth Parliament under that provision with respect to "departments" of the Public Service. McHugh JA decided that the Act did not bind the Commission because there was an inconsistency between the Act and the provisions of the Postal Services Act 1975 (Cth) which set out the requirements for the employment of the Commission's officers. On a~peal, the High Court upheld the decision on the basis of the inconsistency. 1 6 In giving its reasons, the High Court said: [Section 64] was intended to fill what would otherwise be lacunae or gaps in the law of the Commonwealth. It is not to be understood as intended to have the practical effect of overriding s 109 of the Constitution by indirectly applying a provision of a law of a State to circumstances to which its direct application is invalidated by reason of inconsistency... 187 The dicta of McHugh JA cited above were in response to an argument that, despite the inconsistency, s 64 of the Judiciary Act applied the New South Wales Act to the Commission. McHugh JA rejected that argument, as in effect did the High Court on appeal. He explained that because the Act did not apply, no action in tort (he so characterised the action) arose. Earlier in his judgment, he agreed that s 64 had the effect which the High Court gave to it in Commonwealth v Evans Deakin Industries Ltd,188 namely that: [T]he enforcement of an obligation, which the Commonwealth has incurred by reason of its express or tacit consent, may in turn attract other liabilities under s 64 ... i 89 It is important to note that, like Maguire v Simpson, the claim in Commonwealth v Evans Deakin Industries Ltd was primarily a claim in contract (as the effect of the statute was to subrogate the contractor's rights to the subcontractor) which came broadly within the scope of Part IX of the Judiciary Act. The decision is equally open to the interpretation that on the facts the majority of the High Court simply found it unnecessary to determine the precise source of the right to proceed, as the Commonwealth's primary liability arose under the general or common law. By contrast, on the facts of Dao's case as characterised by McHugh JA, that primary liability (in tort) simply did not exist. 18S 186 187 188 189 Ibid at 40. Dao v Australian Postal Commission [1987] HCA 13; (1987) 61 ALJR 229. Ibid at 231. This view is used by L Aitken (1992), above n 12, to support the constitutional argument on the basis that s 64 provides some federal control over Commonwealth liability. [1986] HCA 51; (1988) 161 CLR 254 at 266-267. (1985) 63 ALR 1 at 33-34. At this point his Honour was dealing with the effect of the Cigamatic and Bogle decisions discussed above at 97-99. 1996 Section 64 of the Judiciary Act 115 "As nearly as possible ..." On the facts of Commonwealth v Evans Deakin Industries Ltd it seemed sensible to apply the statute to the Commonwealth as it concerned IImakin~ a contract of a kind commonly entered into by ordinary members of the public."19 This is consistent with the meaning that has been given to the words "as nearly as possible" in s 64 of the Judiciary Act. Commonwealth Evans Deakin Industries Ltd can be supported as a policy decision which accords with the principle that governments should be subject to the same law as citizens when analogous functions are being exercised. 191 The results of both Commonwealth v Evans Deakin Industries Ltd and Maguire v Simpson are compatible with that principle. In Commonwealth v Evans Deakin Industries Ltd,192 the High Court suggested that the natural meaning of "as nearly as possible" means "as completely as possible".193 In that case, as no "function peculiar to government was involved",194 there was no problem in applying the Subcontractors' Charges Act 1974 (Qld) to the Commonwealth. Similarly in Maguire v Simpson,195 there was no difficulty in applying a State Limitation Act to the Commonwealth Trading Bank. If s 64 were "naturally construed", it was said, the statute would apply.196 However, the words have been interpreted as excluding liability where "purposes or functions peculiar to government" are in issue,197 or where the Crown's prerogative198 or "traditional immunities"199 are involved. But if the Commonwealth (or State) is carrying on business or pursuing an activity as if it were a private individual, the words "as nearly as possible" require that it be treated as such. In Commonwealth v John Fairfax and Sons, when the Commonwealth sought an injunction to restrain the defendant from publishing a book in breach of copyright, Mason J said that the Commonwealth should give the usual undertaking with respect to damages as there was "no reason why a distinction should be drawn between the Commonwealth, at least when it seeks an interim injunction to protect a proprietary or private right, and a private citizen ... ".200 Similarly, where the Commonwealth's tort 190 [1986] HCA 51; (1986) 161 CLR 254 at 265. 191 For that reason it has been decided that s 64 does not affect the principle in Auckland Harbour Board v R [1924] AC 318 (that the Crown can recover illegal payments made from consolidated revenue): Commonwealth v Burns [1971] VR 825; Sandvik Australia Pty Ltd v Commonwealth (1989) 89 ALR 213; cf Commonwealth v Crothall Hospital Services (AustJ Ltd 192 [1986] HCA 51; (1986) 161 CLR 254. 193 Ibid at 265 per Gibbs CJ, Mason, Wilson, Deane and Dawson JJ, adopting the expression of Kitto J in Asiatic Steam Navigation Co Ltd v The Commonwealth [1956] HCA 82; (1956) 96 CLR 397 at 427. 194 [1986] HCA 51; (1986) 161 CLR 254 at 265. 195 [1977] HCA 63; (1976) 139 CLR 362. 196 Ibid at 376 per Gibbs J. 197 Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 393-5 per Stephen J, at 408 per Murphy J; Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254. See above n 191. 198 Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 406 per Jacobs J (eg, with respect to limitation of 199 Commonwealth v Lawrence (1960) 77 WN (NSW) 538 at 540 per Else-Mitchell J (eg: priority in 200 [1981] FCA 117; (1981) 36 ALR 567 actions.) relation to Crown debts; restraints on disposal of Crown lands.) [1980] HCA 44; (1980) 32 ALR 485 at 498. 116 Federal Law Review Volume 24 liability arises in circumstances which are analogous to a private citizen's, it will be liable. t01 Actions against States The next issue to arise for decision was whether the explanation for s 64 which the majority in Maguire v Simpson had accepted was applicable to claims against States. That is, was s 64 a provision conferring rights to proceed in the federal jurisdiction against States because of Commonwealth law? Or was it necessary to refer to s 78 of the Constitution as Barwick CJ and Jacobs J had suggested in Maguire v Simpson? Doubts had been expressed about the soundness of either view to explain the ability of the Commonwealth legislature to affect the rights of States. In Commonwealth v Evans Deakin Industries Ltd, the High Court said in relation to s 64 of the Judiciary Act: It is ... doubtful whether the Commonwealth has a general power to legislate to affect the substantive rights of the States in proceedings in the exercise of federal jurisdiction ...202 In Maguire v Simpson, Mason J had raised a similar query when he said: 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... whether the Commonwealth possesses a universal competence with respect to such rights, say, for example, by virtue of s 51(xxxix).203 Gibbs J in China Ocean Shipping v South Australia agreed with that last view and, referring to s 78, added that "it seems clear that the Parliament has no power to legislate so as to affect the substantive rights of a State outside the limits of federal jurisdiction ... ".204 In Maguire v Simpson, Jacobs J pointed out 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 the rights of the Commonwealth or a State in suits where the Commonwealth or State is a party. He added: 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 ...205 In Commissioner for Railways of Queensland v Peters,206 the New South Wales Court of Appeal decided that s 64 did prescribe the rights of a State in proceedings against it. In that case, the reasoning of Commonwealth v Evans Deakin Industries Ltd was applied to a situation where a State court was exercising federal jurisdiction under the combined authority of s 75(iv) of the Constitution and s 39(2) of the Judiciary Act in respect of a claim which did not come within the scope of s 58 of the Judiciary Act. Furthermore, the Court referred to s 78 of the Constitution to support its conclusion. The proceedings in the Peters case were to enforce a statutory entitlement to workers' compensation. The worker was injured in New South Wales while cutting logs into railway sleepers to be supplied to the Commissioner of Railways in Queensland. The issue was whether the Workers' Compensation Act 1926 (NSW) applied to the Commissioner. 207 Section 47(1) 201 202 203 204 205 206 207 Groves v Commonwealth [1982] HCA 21; (1982) 150 CLR 113. (1986) 161 CLR 254 at 264. [1977] HCA 63; (1976) 139 CLR 362 at 401. Cf at 388 per Gibbs J. (1979) 27 ALR 1 at 24. [1977] HCA 63; (1976) 139 CLR 362 at 405. Cf at 370-371 per Barwick CJ. (1991) 102 ALR 579. It was found that the Commissioner was for relevant purposes to be treated as the Crown in right of Queensland. 1996 Section 64 of the Judiciary Act 117 of the Act provided that it "shall apply to workers employed by or under the Crown or any government department to whom [it] would apply if the employer were a private person".208 Two judgments were delivered, that of Kirby P (as he then was) and that of Priestley JA (Waddell AJA agreeing). Kirby P's reasoning was based upon a broad view of the scope of s 78. He adopted the view of Barwick CJ in Maguire v Simpson 209 that s 64 of the Judiciary Act is a law made pursuant to s 78 of the Constitution. Kirby P's view was that the scope of s 58 is limited to claims in tort or contract210 and therefore did not apply on the facts of that case as the claim involved neither, but was "one based upon a statute conferring rights".211 In his view, the Workers' Compensation Act 1926 (NSW) applied by virtue of s 64 of the Judiciar Act. That is, he accepted that s 64 operates independently of ss 58-59. He confined2 2 those comments in Commonwealth v Evans Deakin Industries Ltd and Maguire v Simpson which questioned the role of s 64 in relation to the substantive rights of States to a situation where a State was seeking to enforce rights. He justified the decision in Peters on two broad bases. First, he said that to decide that s 64 did not affect the substantive rights of States in proceedings against it would lead to a dichotomy between States and Commonwealth when sued in the federal jurisdiction. He said: t It would be a wholly unusual and unconventional construction of s 64 ... to find that, where the Commonwealth is a party, the "rights of parties" include substantive rights; but where the suit is against a State only, these "rights of parties" are confined to procedural rights. 213 Secondly, he justified the decision in terms of the broad policy behind the words "as nearly as possible" in s 64. He drew support for this "process of assimilation"214 from Bropho v State of Western Australia215 in which the High Court re-examined the status of the presumption that the Crown is not bound by statutes in the light of the nature of modem government and said that it did not apply as an inflexible rule. 216 He also thought that, on the basis of Breavington v Godleman,217 the Commissioner had consented to the jurisdiction of the New South Wales court. Priestley JA, with whom Waddell AJA agreed, came to the same conclusion, but read s 58 of the Judiciary Act as applying to this claim. That is, he thought that the words "whether in tort or in contract" in s 58 were not "words of limitation, but were used on the footing that any 208 A preliminary issue was whether the Workers' Compensation Act 1987 (NSW), which was proclaimed after the date of injury, applied. Section 6(2) of that Act provided that it "binds the Crown, not only in right of New South Wales but also, so far as the legislative power of Parliament permits, in all other capacities". It was held that the Act did not apply retrospectively. [1977] HCA 63; (1976) 139 CLR 362 at 371-3. (1991) 102 ALR 579 at 598-600. On this point, Priestley JA and Waddell AJA disagreed. Ibid at 600. The leading judgment was delivered by Kirby P, with whom Priestley JA and Waddell AJA generally agreed, although they adopted different reasoning in relation to s 58 of the Judiciary Act. (1991) 102 ALR 579 at 603. Ibid at 604. [1990] HCA 24; (1990) 171 CLR 1. See S Kneebone, "The Crown's Presumptive Immunity from Statute New Light in Australia" [1988] HCA 40; [1991] Public Law 363. (1989) 169 CLR 41. 209 210 211 212 213 214 215 216 217 118 Federal Law Review Volume 24 claim otherwise within the section could be brought".218 He relied upon the Parliamentary Debates on the Bill which became the Claims Against the Commonwealth Act 1902 to show that "the general understanding of the language used [was] that any claim that a subject could bring against another could be brought against the Crown".219 However, he agreed that s 78 was probably the source, though not necessarily the exclusive source, of the rights to proceed, whether under ss 56 -59 or s 64 of the Judiciary Act. Several comments can be made about this decision. The first is that it has clearly linked the "rights to proceed" conferred by s 78 of the Constitution with the rights referred to in s 64 of the Judiciary Act,220 but has interpreted those rights as operating broadly to assimilate the liability of governments to that of private individuals "as nearly as possible" whether in tort, contract or otherwise. The policy behind the decision in Commissioner for Railways v Peters is consistent with that in Commonwealth v Evans Deakin Industries Ltd of "assimilating" the liability of public defendants and private individuals "as nearly as possible". The distinction between causes of action and jurisdiction was maintained by the emphasis on s 78. The relevant causes of action were not limited to those described in ss 56-59 of the Judiciary Act, but extended to "any matter within the judicial competence of the Commonwealth", in this case s 75(iv) of the Constitution. It is arguable that the claim was in any event one in tort, as the primary obligation (to compensate an injured employee) was a tortious one codified by statute. 221 If that analysis is correct, the application of the New South Wales statute was consistent with the lex loci delicti. Secondly it is significant that the Court relied upon the nature of the federal jurisdiction. There was a concern that the "rights of parties" in the federal jurisdiction be uniform whether proceeding against States or the Commonwealth. Kirby Preferred to the need to interpret the provisions of the Constitution broadly so as to achieve uniformity in the application of laws to determine the rights of parties in the federal jurisdiction. 222 The Court accepted the "legislative competence of the Commonwealth ... in conferring rights to proceed against States ...".223 But the question of the rights of parties in proceedings by States was left untouched. The fact that Kirby P saw s 64 as an expression of rights to proceed conferred by s 78 of the Constitution suggests that he agreed with the reservations of Jacobs J in Maguire v Simpson. 224 A final comment is that on the facts the decision is consistent with principles of extra-territorial application 218 (1991) 102 ALR 579 at 614. 219 Ibid. 220 This is consistent with the view of Barwick CJ in Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 221 222 223 224 371-3. Cf Brennan J in Commonwealth v Evans Deakin Industries Ltd [1986] HCA 51; (1986) 161 CLR 254 at 271. The expression is used here to describe legislation which abrogates existing common law either in whole or in part and replaces it with statutory provisions, eg, defamation legislation and compensation schemes. For example, (1991) 102 ALR 579 at 598 (re s 75(iv); at 599 (re s 78); at 605 (re s 51(xxxix). Ibid at 613 per Priestley JA. See also at 605 per Kirby P. Also Maguire v Simpson [1977] HCA 63; (1976) 139 CLR 362 at 388 per Gibbs J: "The conclusion that I have reached ... does not mean that s 64 has an operation which extends beyond constitutional power". Note that the Constitutional Commission in its final report at para 6.277 remarked: "There can be no question of a general law under section 78, that lays down that [sic] the substantive rights of the States in all proceedings in federal jurisdiction." 1996 Section 64 of the Judiciary Act 119 of State legislation. 225 It is also consistent with Public Curator of Queensland v Morris,226 in which it was decided that a New South Wales Act bound the Crown in right of the State of Queensland. TWO RECENT HIGH COURT DECISIONS: ENTRENCHED JURISDICTION AND VESTED RIGHTS In two recent High Court decisions the question was whether the Commonwealth's liability could be extinguished by legislation, thus raising the issue of whether the Commonwealth's liability is constitutionally entrenched. In both cases, s 51(xxxi), the "acquisition of property on)ust terms" guarantee in the Constitution, was relevant. In the Mutual Pools decision,22 in which legislation which prescribed the circumstances in which a builder could claim a refund of sales tax paid under invalid legislation was challenged, it was held that the Commonwealth could extinguish its liability to make a refund. In the Georgiadis decision,228 it was decided that legislation which extinguished the Commonwealth's common law liability in tort was invalid. In both cases counsel had referred in argument to the scope of s 78 of the Constitution, or to ss 56 and 64 of the Judiciary Act, but, with the notable exceptions of McHugh and Brennan JJ, in neither case did the High Court find it necessary to deal with these arguments. The discussion in the cases confirms that the jurisdiction of the High Court rather than the rights of parties is entrenched by the Constitution. The Mutual Pools decision In Mutual Pools, the issue was whether the Swimming Pools Tax Refund Act 1992 (Cth) providing for tax refunds was valid. The Refund Act had been passed to deal with a successful High Court challenge by builders of swimming pools that legislation imposing a sales tax on the construction of swimming pools was an invalid tax law. Pending the outcome of the High Court challenge, builders had paid the disputed sales tax on the basis that if the challenge were successful all amounts paid would be refunded. The Refund Act provided that the Commonwealth was liable to make a refund if a builder had not passed the liability to stamp duty on to the purchaser of the swimming pool, or if the builder had passed on the stamp duty but had refunded the amount paid to the purchaser. In this case the builder had passed on the stamp duty but had not given a refund to the purchaser. The builder challenged the validity of the Act on the basis that it took away his right to claim "restitution" of a payment made under an invalid law. He argued that it was invalid for three reasons - that it was not a valid tax law under s 51(ii) of the Constitution, or under the incidental power in placitum (xxxix) or an acquisition of property on just terms as required by placitum (xxxi). The Commonwealth argued that it had power under s 78 of the Constitution to limit its liability and further that this power was not subject to s 51(xxxi) (and that in any event this was not an acquisition of "property" or that if it was, it was on "just terms" as it prevented a windfall to the builder). The Commonwealth's s 78 argument 225 For example, Union Steamship Co. of Australia v King [1988] HCA 55; (1988) 166 CLR 1; Pearce v Florenca 226 227 228 [1976] HCA 26; (1976) 135 CLR 507. Kirby P noted (102 ALR 579 at 595) that had the 1987 Act had retrospective operation those principles would have applied. [1994] HCA 9; (1951) 51 SR (NSW) 402. (1993) 179 CLR 155. (1993) 179 CLR 297. 120 Federal Law Review Volume 24 was based on the extended interpretation of the views of Barwick CJ and Jacobs J in Maguire v Simpson that s 78 applied to any relevant matter. The Solicitor-General for South Australia, intervening, argued that s 78 was not the source of power for the extinction of liability - that s 78 only applies to remove the "prerogative" immunities and does not extend to the creation or removal of liabilities not existing at common law or under a valid statute. This is the limited interpretation of the views of Barwick CJ and Jacobs J. The High Court decided unanimously that the Act was a valid tax law under s 51(ii) and that it did not contravene placitum (xxxi). Four members of the Court also said that it was authorised by placitum (xxxix).229 The majority thus did not need to deal with the s 78 argument. The exception was McHugh J, who agreed with the submission of the Solicitor-General of South Australia that s 78 primarily relates to the removal of the Crown's immunity in tort and contract. 230 He also cited a series of cases in support of the proposition that the power of the federal Parliament to bar remedies is subject to two restrictions: namely s 51(xxxi) and the principle that "what Parliament cannot do it cannot do indirectly". That is, the power conferred by s 78 was not intended "to enable the federal Parliament to protect itself against the consequences of enacting a statute beyond its constitutional powers."231 He said: Section 78 must be read in the context of a document which allocates powers between the Commonwealth and States and creates a High Court in which it vests the judicial power of the Commonwealth for the purpose, inter alia, of enforcing the Constitution's allocation of power. 232 This, he thought, was an argument for saying that the jurisdiction conferred on the High Court by s 75(iii) should be entrenched in the same way as it is for s 75(v) of the Constitution when a privative clause is in issue. 233 However, he continued, referring to Commonwealth v New South Wales,234 this did not mean that s 75(iii) was itself the source of liability.235 It simply meant that its inclusion in the Constitution enables actions to be brought in the High Court about the scope of the Commonwealth's constitutional powers. He concluded that this meant that "it would not be open to the federal parliament to bar the right to Eroceed against the Commonwealth in respect of the scope of its constitutional powers".236 McHugh ]'8 view is consistent with the idea that s 78 of the Constitution is limited to removal of the Crown's immunity in tort (and contract). It is also endorses the distinction between a cause of action and jurisdiction. By comparing ss 75(iii) and (v) of 229 Mason CJ, Brennan, Dawson and Toohey JJ. 230 [1994] HCA 9; (1993) 179 CLR 155 at 215. 231 Ibid. McHugh J relied in particular upon the Canadian authority of Amax Potash Ltd v Government of Saskatchewan [1977] 2 SLR 576 at 592. Note that Professor Campbell points out that some of the opinions in Werrin's case [1938] HCA 3; (1938) 59 CLR 150 support the contrary 232 233 234 235 236 proposition. See E Campbell, above n 26 at 27-34. See also C L Pannam, "Torts under Unconstitutional Statutes" [1966] MelbULawRw 1; (1966) 5 Melb Univ LR 113 at 133-134. [1994] HCA 9; (1993) 179 CLR 155 at 216. Ibid. In support, he cited a number of cases involving privative clauses in which the High Court has held that its jurisdiction in relation to judicial review under s 75(v) is entrenched, eg, R v Hickman; Ex parte Fox and Clinton [1945] HCA 53; (1945) 70 CLR 598. (1923) 32 CLR 200. (1993) 179 CLR 155 at 217. Ibid. 1996 Section 64 of the Judiciary Act 121 the Constitution, McHugh J emphasised the significance and entrenched nature of the High Court's jurisdiction. By suggesting that s 78 does not permit the enactment of invalid legislation, McHugh J rejected the Commonwealth's argument based upon the broad view of s 78 and recognised that s 78 is subject to the Constitution. The High Court in Mutual Pools recognised that their decision was consistent with that in Werrin v Commonwealth. 237 That was an action in restitution and two members of the High Court decided that there could be no recovery because the money was paid voluntarily under a mistake of law,238 whilst three decided on the basis that the legislation barring the action was valid. 239 In Mutual Pools, some indirect reference was made to the fact that the plaintiff's rights might lie in restitution. Counsel for the Commonwealth argued that the terms of the Act (which precluded a refund where the builder had passed the tax on to the purchaser and not refunded the tax) were consistent with the common law (equitable) principles of restitution based on unjust enrichment; these principles prevented windfall gains by builders. Because of the views developed in their judgments, the High Court did not need to consider whether the "acquisition" was in any event on "just terms". Brennan J alone considered this in passing - he thought that it did not satisfy that requirement. He pointed out that "the debt was owned beneficially by the plaintiff ... not by the pool owners" and that technically the plaintiff's claim for "restitution" was not dependent on the plaintiff's arrangement with the pool owner. 240 As a result of the decision of the High Court in David Securities v Commonwealth Bank,241 and that of the House of Lords\'in Woolwich Equitable Building Society v Inland Revenue Commissioners,242 the plaintiff's claim could not have been rejected on the ground that it involved a mistake of law. As for the Commonwealth's argument that the Act prevented a windfall by the builder as he had passed on the payment, it is possible that a defence of "passing on" might have succeeded. It is now well established that the right to restitution is based upon the unjust enrichment of the recipient rather than upon an implied contract. 243 The "passing on" defence was recently considered by Mason CJ,244 who concluded that it should not succeed "unless it is established that the defendant's enrichment is not at the expense of the plaintiff but at the expense of some other person ...".245 He explained that a plaintiff fails in such circumstances not because the tax has been passed on, but because the defendant is enriched by someone other 237 Ibid at 173 per Mason CJ, at 204-205 per Dawson and Toohey JJ, at 211-212 per McHugh J. Werrin v Commonwealth was discussed above in relation to the effect of s 75(iii) of the Constitution. 238 Latham CJ and McTiernan J. 239 Rich, Starke and Dixon JJ. 240 [1994] HCA 9; (1993) 179 CLR 155 at 177. 241 [1992] HCA 48; (1992) 175 CLR 353. 242 [1992] 3 All ER 737. 243 Pavey Matthew Pty Ltd v Paul (1986) 162 CLR 217. 244 See Commissioner of State Revenue v Royal Insurance Australia Ltd [1994] HCA 61; (1994) 182 CLR 51 at 69. In that case, which concerned the interpretation of a statutory discretion to refund overpaid stamp duty, Mason CJ alone based his conclusion upon "common law restitution" (as Brennan J labelled it, ibid at 90). The other judges came to the same conclusion on the facts by relying upon the interpretation of the statutory discretion. 245 Ibid at 73. 122 Federal Law Review Volume 24 than the plaintiff. 246 On the facts of Mutual Pools, the Commonwealth's enrichment appeared to be at the expense of the purchaser and thus the decision is consistent with the merits (despite Brennan J's view). On the facts of Mutual Pools in the context of the placitum (xxxi) "acquisition on just terms" argument, the Refund Act was characterised as extinguishing a cause of action247 (the plaintiff's "chose-in-action" or common law right to claim the debt)248 rather than "an acquisition of property".249 Deane and Gaudron JJ in their joint judgment and McHugh J in his judgment stressed that s 51(xxxi) contains a constitutional guarantee but that such guarantees are subject to displacement where taxation laws are concerned. They said that it is a matter of construction. 250 McHugh J explained that the exercise of the taxation power necessarily involves an acquisition of property from the taxpayer. 251 Deane and Gaudron JJ said that placitum (xxxi) in s 51 "exists as a confining component of the subject matter of that paragraph's positive grant of legislative power."252 In a spate of recent cases, challenges to Commonwealth laws removing the rights of individuals as contraventions of placitum (xxxi) have been rejected and the Mutual Pools decision has been applied to uphold the legislation. These were cases where the individual's rights could be described as statutory entitlements253 or where the nature of the right was subject to the exercise of the Commonwealth's prerogative rights254 or the public interest. 255 These cases illustrate the limits of the constitutional guarantee which s 51(xxxi) contains. The Georgiadis decision In the second case, Georgiadis v Australian and Overseas Telecommunications Corporation,256 it was decided by four judges to three that a statute removing the common law right to claim damages did contravene placitum (xxxi) of s 51 (acquisition on "just terms"). The statute in question was s 44 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 (Cth) (the Comcare Act) which had the effect of limiting an injured employee to a claim for statutory compensation by preventing an action for damages after December 1988. The plaintiff had sustained a 246 Ibid. 247 [1994] HCA 9; (1993) 179 CLR 155 at 173 per Mason CJ, at 185 per Deane and Gaudron JJ, at 204 per 248 Ibid at 176 per Brennan J. 249 Brennan J decided that the Refund Act could not be characterised as a law providing for the taking of property: ibid at 177-181. Cf Deane and Gaudron JJ, who decided that the Act was outside the reach of the constitutional guarantee provided by s 51 (xxix): ibid at 184190. See also ibid at 221-222 per McHugh J. Dawson and Toohey JJ decided that the Act did not involve the acquisition of property: ibid at 194-204. Ibid at 186 -187 per Deane and Gaudron JJ, at 222-223 per McHugh J. Ibid at 221. Ibid at 185. For example, Health Insurance Commission v Peverill [1994] HCA 8; (1993) 179 CLR 226 (retrospective reduction of benefits payable under the Medicare scheme). Cf Gilvarry v Commonwealth (1994) 127 ALR 721, discussed below at 126-128. Re Director of Public Prosecutions; Ex parte Lawler [1994] HCA 10; (1993) 179 CLR 270 (seizure of vessel used in commission of offence under fisheries legislation). For example, WSGAL Pty Ltd v Trade Practices Commission [1994] FCA 1079; (1994) 122 ALR 673 (divestiture provisions justified in the public interest to maintain competition in trade and commerce). (1993) 179 CLR 297. Dawson and Toohey JJ. 250 251 252 253 254 255 256 1996 Section 64 of the Judiciary Act 123 series of injuries before 1988. Thus the statute extinguished the plaintiff's pre-existing right to bring a common law action in tort. It was argued on behalf of the Commonwealth that s 51(xxxi) does not operate to restrict the powers of Parliament to amend statutory schemes dealing with rights which have not yet come into existence, or which merely alter the plaintiff's right to claim compensation. It was argued further that rights to proceed against the Commonwealth are creations of ss 56 and 64 of the Judiciary Act, "granted gratuitously, and as such are liable to diminution or extinction."257 That is, it was argued that because the Commonwealth's immunity in tort had been removed by statute, it could be later "waived" by statute, as in the case of other statutory entitlements. Finally it was argued that the legislation did not involve an acquisition of property; at the most it involved extinguishing property. The judges in the majority decided the case on the s 51(xxxi) argument, although Brennan J did refer to the Commonwealth's argument that its immunity could be restored by statute. Mason CJ/ Deane and Gaudron JJ/ in a joint judgment, decided that extinguishing a vested cause of action amounted to an acquisition, "at least where the extinguishment results in a direct benefit or financial gain ... and the cause of action arises under the generallaw."258 They continued: The position may be different in a case involving the extinguishment or modification of a right that has no existence apart from statute.... There is no acquisition of a right which has no basis in the general law and which, of its nature, is susceptible to that course. 259 In conclusion they said: Thus and so far as it bears on the issues in this case, s 44 is, in substance if not in form, a law for the acquisition of causes of action against the Commonwealth and its agencies which vested in employees before s 44 came into operation ....260 In response to the Commonwealth's argument based upon ss 56 and 64 of the Judiciary Act, Brennan J said: Assuming, without deciding, that the Commonwealth's liability in tort is dependent on laws of the Commonwealth, that liability is not the creature of statute. The liability is created by the common law and, provided the corresponding common law cause of action is vested, the person in whom it is vested is entitled to the protection of s 51(xxxi). It may be ... that the Commonwealth's immunity in tort was removed by laws of the Commonwealth but, so long as that immunity is removed, the causes of action created by the common law and vested in a person are protected by s 51(xxxi).261 It is important to note that the plaintiff's interest was consistently characterised by the majority as a vested or common law right. It is conceivable that if the judges who delivered the joint judgment had considered the source of the Commonwealth's liability, they would have expressed the same opinion as Brennan J/ namely that it is a creature of the common law giving rise to a vested common law right which s 51(xxxi) would protect. The view of Brennan J (which is consistent with the reasoning of the other majority judges) is that there could be no "waiver" of such common law rights so long as the immunity is removed. But in the same passage he leaves open the question 257 Ibid at 300. 258 Ibid at 305. They gave as an example of a "vested cause of action" an action against the Commonwealth for goods sold and delivered. 259 Ibid at 305-306. 260 Ibid at 306 (emphasis added). 261 Ibid at 312 (emphasis added). 124 Federal Law Review Volume 24 whether a removal of that immunity by amendment to s 64 of the Judiciary Act would infringe s 51(xxxi). Significantly, the majority did not refer to s 78 of the Constitution. The dissenting judges in Georgiadis all delivered separate judgments and two of those three, relying upon s 78 of the Constitution, expressed the view that a "waiver" of immunity would not contravene s 51(xxxi). Dawson and Toohey JJ concluded that the legislation involved an extinguishment rather than an acquisition of property.262 Toohey J seemed to accept the Commonwealth's argument that the legislative waiver of the immunity in tort could be reversed. He said: The right to bring a suit against the Commonwealth in tort is conferred by Commonwealth legislation and it is hard to see how a law which affects that right, even a law diminishing or extinguishing it, can fall within s 51(xxxi).263 McHugh J also dealt with the argument that the Commonwealth could "reverse" the waiver of its immunity. He thought that ss 56 and 64 of the Judiciary Act were the source of the Commonwealth's liability and that in the light of s 78, laws could be passed removing that liability.264 McHugh J reiterated the view that s 75(iii) of the Constitution was not the source of liability,265 referring again to the decision in Commonwealth v New South Wales. On the facts (and because s 78 was the constitutional source of the "right to proceed"), McHugh J thought that no question of complying with s 51(xxxi) arose. 266 Thus McHugh J confirmed the views he had expressed in the Mutual Pools case, that s 78 of the Constitution should be read with ss 56 and 64 of the Judiciary Act as being directed to removing the Crown's immunity in tort and contract, and that such removal could be reversed. Further, he was of the opinion that where an exercise of power is challenged for contravening s 51(xxxi) of the Constitution, the constitutional guarantee is subject to displacement. In this case, because s 78 of the Constitution referred to rights which could be altered by subsequent legislation, the constitutional guarantee was displaced. As a result of this case it appears that there is a view emerging amongst some members of the High Court (Brennan CJ and Gaudron J of the current Court) that the liability of the Commonwealth is entrenched in the common law, protected by s 51(xxxi). The corollary of this view is that there cannot be any "waiver" of the traditional immunity. The cases suggest a distinction between vested (common law) rights and non-vested or statutory and prerogative rights and this must be appreciated in determining whether removal of the Commonwealth's liability infringes s 51(xxxi), and whether there can be a "waiver" of immunity. However, some members of the High Court (for example, McHugh and Toohey JJ)267 are of the view that the Commonwealth's liability arises from a statutory waiver of immunity and can be subsequently modified or reversed by legislation which falls outside the protection of s 51(xxxi). But it is difficult to see how it can be concluded, as Aitken has, that these cases show that some members of the High Court "are moving to a position where the 262 263 264 265 266 267 Ibid at 315 per Dawson J, at 320 per Toohey J. Ibid at 321. Ibid at 326. Ibid at 325. Ibid at 326. It is possible that Kirby P ('1-s he then was) shares their view on the basis of his analysis in Commissioner for Railways v Peters (1991) ALR 579. See discussion above at 116-119. 1996 Section 64 of the Judiciary Act 125 liability of the Commonwealth is entrenched and constitutionally guaranteed".268 The position as described above is that some judges look for the source of liability in the common law or otherwise as a preliminary to considering the constitutional validity of Commonwealth action, whereas others tend to the view that the removal of the Crown's traditional liability can be reversed by legislation. However it is accepted that the jurisdiction of the High Court, but not the liability of the Commonwealth, is entrenched by the Constitution. The view that Georgiadis endorses the entrenchment of vested or common law rights was acce~ted and applied in the recent Federal Court decision of Commonwealth v Mewett. 26 In a preliminary application to strike out a statement of claim, the effect of the Georgiadis decision and the notion of "acquisition of property" were extended to protect vested rights which were barred by a Statute of Limitations. In that case the plaintiff sued the Commonwealth in tort and contract in New South Wales for injuries he had sustained in Victoria whilst aboard a ship. The plaintiff was a member of the Royal Australian Navy at the time. 270 The incident occurred in 1979 and, if ss 14 and 63(1) of the Limitation Act 1969 (NSW) had applied, the plaintiff's cause of action would have been extinguished in 1985. Section 44 of the Comcare Act was also in issue (as in Georgiadis) as the claim was made after December 1988. Foster J rejected the application to strike out the statement of claim on the basis that, subject to the plaintiff's right to seek an extension of the limitation period, his rights were "vested" within the meaning of s 51(xxxi) and capable of being revived at the time that s 44 came into operation. 271 Foster J described "vested" rights as those "otherwise available to found an action".272 He decided that a successful application for extension of time would retrospectively result in the plaintiff's cause of action being vested at the time that s 44 commenced. He rejected the argument that s 44 converted the plaintiff's rights into mere statutory creations for the purpose of s 51(xxxi) of the Constitution. The facts of that case also show that the issue of whether rights are vested often intermingles with choice of law issues. The cause of action arose in Victoria and the legislation in that State may not have had the effect of barring the action as did the Limitation Act 1969 (NSW) on its face. Foster J decided that s 56 rather than s 79 of the Judiciary Act supplied the choice of law rule on the facts of that case, where it was a question of the application of a State statute to a plaintiff rather than to the Commonwealth. In so doing, he applied the decision of Windeyer J in Suehle v Commonwealth, 273 in which it was decided that s 56 refers to the lex loci delicti. In Commonwealth v Dinnison, 274 where a claim was brought against the Commonwealth in New South Wales for a cause of action arising in South Austalia (where the relevant 268 L Aitken (1994), above n 12 at 691. 269 270 Groves v Commonwealth [1982] HCA 21; (1982) 150 CLR 113; Commonwealth v Verwayen (1990) 170 CLR 394; 271 Commonwealth v Connell (1986) 5 NSWLR 218 are examples of liability arising out of the services in peace time. Cf Gilvarry v Commonwealth (1994) 127 ALR 721. In that case it was decided that there was no acquisition by s 44 of a statute-barred claim, in the face of a provision which updated the limitation period to a point after s 44 had come into effect. This is discussed below at 126-128. [1994] FCA 1444; (1995) 126 ALR 391 at 397. [1967] HCA 13; (1967) 116 CLR 353. (1995) 129 ALR 239. [1994] FCA 1444; (1995) 126 ALR 391 per Foster J. 272 273 274 126 Federal Law Review Volume 24 Limitation Act barred the action), Gummow and Cooper JJ in obiter discussion thought that the parties might have argued that s 79 "picked up" s 63 of the Limitation Act (NSW) and that this contravened s 51(xxxi) of the Constitution. 275 The decision of Nathan J in the Supreme Court of Victoria in Gilvarry v Commonwealth,276 where the facts were substantially similar to those in Mewett's case, illustrates a different approach. Gilvarry's case, like Georgiadis and Mewett, was also concerned with the effect of s 44 of the Comcare Act. The plaintiff was a sailor on board the HMAS Voyager which sank off Jervis Bay in New South Wales in 1964. In 1994 he issued a writ against the Commonwealth in the Supreme Court of Victoria; his claim related to psychiatric injuries. The Commonwealth raised s 5(1)(a) of the Limitation of Actions Act 1958 (Vic), which prohibits the bringing of a negligence action more than six years after the cause of action arose. The Commonwealth also argued that s 44 extinguished the plaintiff's claim. The plaintiff in tum claimed that s 5(1A) of the Limitation Act applied to him, as it allowed for an action in negligence to be brought not more than six years from the date upon which a person first knew that he had suffered personal injuries. He argued that s 44 contravened s 51(xxxi) of the Constitution. Nathan J decided that the plaintiff's action was not maintainable. He proceeded from the premise that the issue was to be decided as one of consistency between a State and a Commonwealth Act. He referred to Deputy Commissioner of Taxation v Moorebank 277 as further authority, and decided that the Comcare Act had "covered the field".278 He rejected the argument that s 44 could be characterised as an acquisition of property, saying that the plaintiff's statute-barred cause of action "is not property that can be acquired", or, alternatively that "his rights have been extinguished rather than acquired".279 He dismissed the argument that s 5(1A) of the Limitation Act was a procedural provision which applied by virtue of s 64 or s 79 of the Judiciary Act. There are two aspects of this reasoning which are troubling. The first is Nathan J's primary analysis of the issue as a constitutional one. The second is his analysis of the effect of the Limitation Act upon Mr Gilvarry's rights. In Georgiadis,280 the effect of s 44 of the Comcare Act upon statute-barred causes of action was expressly left open in the majority joint judgment,281 but it was stressed that s 44 is not a law which modifies limitation periods in relation to causes of action which had come into effect before the new scheme. 282 It was said in the joint judgment in Georgiadis that it was necessary to see what causes of action were vested in the plaintiff when s 44 of the Comcare Act came into effect, but it was also emphasised that the causes of action which were found to be vested on the facts of that case reflected the expectations of the plaintiff when he performed the work which led to the injury.283 That is consistent with the majority's characterisation of the plaintiff's rights as arising from the common law in that case. Further, in the joint judgment in Georgiadis it was 275 Ibid at 243. 276 277 278 279 280 281 282 283 [1988] HCA 29; (1995) 127 ALR 721. (1988) 165 CLR 55, referred to (1995) 127 ALR 721 at 737. Ibid at 735-736 and 737. (1995) 127 ALR 721 at 733. (1993) 179 CLR 297. Ibid at 308. Ibid at 307. Ibid at 306. 1996 Section 64 of the Judiciary Act 127 stressed that the constitutional guarantee contained in s 51(xxxi) was to be construed "liberally".284 Their Honours did say, however, that tIs 44 may be susceptible of other characterizations".285 Nathan J in Gilvarry viewed the matter as primarily one of a competition between State and Commonwealth legislation, rather than analysing what rights the plaintiff had when the Comcare Act came into effect. He characterised Mr Gilvarry's "statutebarred action" as "not property that can be acquired."286 This reasoning appears to be contrary to the thrust of the majority's emphasis on common law rights in Georgiadis, but aligned with the emphasis placed by the minority in that case on the Commonwealth's power. Further, in Gilvarry the plaintiff was claiming the benefit of a extension of his rights rather than the benefit of the extinguishment of claims against him as in Moorebank. It seems inappropriate to use s 109 of the Constitution to resolve questions about a plaintiff's rights as distinct from Commonwealth rights, particularly when those rights concern a basic common law right to compensation. 287 The majority in the Georgiadis case regarded it as significant that s 44 of the Comcare Act applies only to Commonwealth employees. 288 That strengthened their view that s 44 was a law for acquisition of property as it targeted those employees as a special group. That again emphasises the plaintiff's common law rights. The second aspect of Nathan ]'S reasoning relates to the effect of s 5(lA) of the Limitation Act. Arguably it is similar to the extension provisions of the New South Wales Act which were discussed in Mewett's case. 289 Mr Gilvarry had also argued that s 5(lA) of the Limitation Act operated retrospectively, and that in this respect it was akin to s 23A of the Victorian Act which provides for an extension of time. Nathan J, however, equated enforceable claims (remedies) with vested claims or rights. 290 That appears to confuse the issue of jurisdiction with causes of action. He said: Section 44 does what it says, and s 5(lA) does not by procedural means, reinstate the substantive right to common law damages for negligence, curtailed by Comcare. 291 However, it could be argued that the plaintiff's cause of action did vest retrospectively, particularly given the nature of the injury (psychiatric damage which can be latent for some years). Further it is arguable that s 5(lA) is both substantive in that it defines a claimant's rights and procedural in qualifying s 5(l)(a).292 Moreover, it is a well established principle of statutory construction that statutes should not be interpreted "so as to impair existing rights or to attach a new disability in regard to events already passed."293 284 285 286 287 288 289 290 291 292 293 Ibid at 303. Ibid at 308. 127 ALR 721 at 733. Commonwealth v Dixon (1988) 13 NSWLR 601 at 622 per Mahoney J. (1993) 179 CLR 297 at 308. [1994] FCA 1444; (1995) 126 ALR 391. (1995) 127 ALR 721 at 729. Ibid at 738. Cf McKain v Miller (1991) 174 CLR 1 at 41. Commonwealth v Dixon (1988) 13 NSWLR 601 at 611 per Hope JA (discussing the effect of s 63 of the New South Wales Limitation Act which was expressed to extinguish a cause of action on the expiration of the limitation period). 128 Federal Law Review Volume 24 Gilvarry's case simply raised the question whether s 79 (in conjunction with s 64 of the Judiciary Act) applied s 5(lA) of the Limitation Act to the Commonwealth in proceedings against it in the Victorian Supreme Court as the lex fori. Nathan J, however, discussed and dismissed an argument based upon the effect of s 79 of the Judiciary Act, distinguishing Maguire v Simpson 294 on the basis that it was concerned with the substantive rights of the Commonwealth. 295 A similar distinction was made by Foster J in Mewett's case,296 and possibly for that reason his Honour preferred s 56 as a choice of law rule (Nathan J did not refer to s 56). But, with respect to both judges, this manner of distinguishing Maguire v Simpson is not consistent with the fact that s 79 applies generally to proceedings in the exercise of federal jurisdiction. Overall the Gilvarry decision illustrates in a practical way the difference between the perspectives adopted by McHugh J and Brennan CJ. The latter emphasises common law rights, the former the Commonwealth's power. SUMMARY AND DISCUSSION At the outset the debate as to the source of the Commonwealth's civil liability was expressed as being between constitutionally entrenched liability (arising from the conferral of jurisdiction under the Constitution) and rights conferred by s 64 of the Judiciary Act, combined with "rights to proceed" allowed by the Constitution, subject to legislative removal. In fact the authorities suggest that in the light of the following propositions, the debate has to be reformulated: · The High Court has stressed that its jurisdiction rather than the cause of action (or its substantive liability) is entrenched by the Constitution. · The bulk of authority favours the view that s 78 of the Constitution, read with ss 56 and 64 of the Judiciary Act, is responsible for the removal of the Commonwealth's immunity in tort. The corollary of this, according to the view of McHugh J (which is shared by Toohey J), is that such removal can be "waived". · There is a division of opinion about whether that removal of immunity can be waived in the light of s 51(xxxi) of the Constitution. In Georgiadis the majority stressed the common law source of rights to sue the Commonwealth. In their view such rights are entrenched and protected by s 51(xxxi). That view was endorsed in Mewett's case. It follows from this view that the immunity cannot be waived in relation to entrenched common law rights. · The minority in Georgiadis thought that the fact that such immunity was conferred by statute (s 78 of the Constitution was stressed) meant that it could be waived by statl.lte. The constitutional guarantee of s 51(xxxi) was thus displaced. That view is the antithesis of the constitutional argument as it uses the fact that "rights to proceed" are conferred by the Constitution to argue for their removal. Thus the debate is not about whether s 75(iii) of the Constitution entrenches liability but whether the immunity of the Commonwealth can be waived in relation to its 294 (1976) 139 CLR 383. of the jurisdiction which the Federal Court exercised in that case. See discussion below at 130. 295 (1995) 127 ALR 721 at 737. 296 [1994] FCA 1444; (1995) 126 ALR 391 at 409. Foster J's reasoning was also based upon his view of the nature 1996 Section 64 of the Judiciary Act 129 liabilities. The debate has arisen in the context of the constitutional guarantee provided by s 51(xxxi). There is agreement that statutory and other "non-vested" liabilities can be waived. 297 At the heart of the debate is the nature of rights to sue the Commonwealth and the effect of removal of the traditional immunity: are such rights, as Dixon J expressed it in Werrin v Commonwealth, rights existing "in contemplation of law"298 which ripen upon the creation of a procedural right? This view, which accords with Brennan Crs notion of "entrenched common law rights", is consistent with the basic rule that the liability of governments is to be governed by the same principles and under the same headings as apply to private individuals. The view of McHugh J in effect treats the tort liability of the Commonwealth as a species of statutory liability. There are important differences between the two views. The view of McHugh J (that there can be "waiver") is based upon his vision of the nature of the federal system. In the Mutual Pools case he stressed that s 78 had to be read in the context of a Constitution that allocates power between the Commonwealth and States but which vests judicial power in the Commonwealth. The view of Brennan CJ is that liability derives from the common law and that s 51(xxxi) of the Constitution preserves it. There is thus a fundamental difference of perspective which is illustrated by the comparison between the views of Foster J in Mewett's case299 and those of Nathan J in Gilvarry's case. 300 The view of McHugh J (which corresponds to that of Nathan J), emphasises the paramountcy of Commonwealth rights under the Constitution. The view of Brennan CJ (which corresponds to that of Foster J), emphasises the common law basis of citizens' rights agahLst governments where civil liability is in issue. There are serious limitations to the view of McHugh J which is based upon the judicial power of the Commonwealth. Consideration needs to be given to the position of courts exercising federal jurisdiction. That federal jurisdiction is of a special nature, deriving from different sources301 to those of the High Court's jurisdiction (upon which the view of McHugh J relies). In Breavington v Godleman 302 and again in McKain v Miller,303 Deane J insisted upon "the overall unity of the law of this country and the consistency and predictability of the identity of applicable substantive rules under [a] national legal system".304 Commissioner for Railways v Peters illustrated that in the context of proceedings against States, s 78 of the Constitution, in conjunction with s 64 of the Judiciary Act, enables a degree of consistency and uniformity to be obtained in proceedings in the federal jurisdiction. The view of McHugh J, which emphasises the paramountcy of Commonwealth powers, is not easily reconciled with the nature of the federal jurisdiction. Further, there are uncertainties about the application of the view of McHugh J when the Federal Court is exercising jurisdiction. The Federal Court may derive its 297 Health Insurance Commission v Peverill [1994] HCA 8; (1993) 179 CLR 226; Re Director of Public Prosecutions; 298 299 300 301 302 303 304 Ex parte Lawler [1994] HCA 10; (1993) 179 CLR 270; WSGAL Pty Ltd v Trade Practices Commission (1994) 122 ALR673. [1938] HCA 3; (1938) 59 CLR 150 at 167-168. [1994] FCA 1444; (1995) 126 ALR 391. (1994) 127 ALR 721., · Discussed above at 102-105. [1988] HCA 40; (1988) 169 CLR 41 at 121. (1991) 174 CLR 1. Ibid at 46. 130 Federal Law Review Volume 24 jurisdiction from several sources: cross-vested jurisdiction, associated or accrued jurisdiction305 in conjunction with an application under s 39B of the Judiciary Act,306 or remitted jurisdiction under s 44(2A) of the Judiciary Act which refers to s 75(iii) matters. In Commonwealth v Dinnison,307 Gummow J described the Federal Court's remitted jurisdiction as "co-extensive"308 with the High Court's for the purpose of the application of s 79 of the Judiciary Act. 309 The combined effect of s 44(2A) of the Judiciary Act and s 19 of the Federal Court Act (which describes the Federal Court's original jurisdiction) is to confer the High Court's original jurisdiction in s 75(iii) matters on the Federal Court. If the Federal Court's jurisdiction derives from s 39B of the Judiciary Act, recent High Court authority suggests that the jurisdiction is not constitutionally entrenched, at least where a privative clause is in issue. 310 It is thus unclear whether the argument about entrenched jurisdiction applies to the exercise of jurisdiction by the Federal Court in civil proceedings. CONCLUSION The reformulated debate about the source of the Commonwealth's liability involves two interrelated questions: · whether the Commonwealth's liability should be constitutionally entrenched in some form; or · whether s 64 of the Judiciary Act in conjunction with s 51(xxxi) provides adequate protection for the rights of citizens. In relation to the first issue it is submitted that the argument in favour of constitutional entrenchment is weak. It pays insufficient regard to the history of Crown immunity and to the background of the legislation which was clearly intended to put the Commonwealth in the same position as individuals in accordance with the basic rule. It ignores the fact that the courts have achieved sensible results through the application of s 64 of the Judiciary Act. It would lead to difficulties in applying statutory protection clauses311 and other similar restrictions upon liability against the Commonwealth. 312 This in tum would create discrepancies in comparison with the position of the States, the liability of which is not constitutionally entrenched. Moreover, it is arguable that entrenching rights in the Constitution would have the effect of enhancing the assumed superiority of the Commonwealth by preventing the application of statutes. It was argued that the operation of s 64 of the Judiciary Act modifies the effect of the Cigamatic decision which is based upon the assumed superiority of the Commonwealth. Gilvarry's case illustrates the effect which an 305 Federal Court Act 1976 (Cth), s 32. 306 For example, Bienke v Minister for Primary Industries & Energy (1994) 125 ALR 151; 34 ALD 307 308 309 310 311 312 413. (1995) 129 ALR 239. Ibid at 243. Cf Commonwealth v Mewett [1994] FCA 1444; (1995) 126 ALR 391 at 402 where Foster J described it as "derivative or surrogate" of the High Court. Deputy Commissioner of Taxation v Richard Walter Pty Ltd [1995] HCA 23; (1995) 69 ALJR 223. A majority disapproved of the decision in David Jones Finance & Investments Pty Ltd v Federal Commissioner of Taxation (1991) 99 ALR 447. Little v Commonwealth [1947] HCA 24; (1947) 75 CLR 94. Musgrave v Commonwealth (1937) 57 CLR at 546 per Dixon J. 1996 Section 64 of the Judiciary Act 131 approach based on the assumed supremacy of Commonwealth powers has upon the rights of an individual. Finally, constitutional entrenchment is difficult to reconcile with the separation of powers which the Constitution envisages. To enable Parliament to control the liability of the Commonwealth or States sued in the federal jurisdiction would undermine the role of the courts to determine the rights of parties. In Bienke v Minister for Primary Industries and Energy,313 after querying the extent and source of "waiver" of the Commonwealth's liability, Gummow J continued: "Does the 'waiver' extend to actions against public officers of a kind previously noncognisable?"314 This statement highlights the potential of the constitutional argument to unsettle the stability which the courts' interpretation of s 64 has created. Gummow J said that the uncertainty surrounding this "waiver" might be used to create new types of liability, such as an "administrative tort".315 These comments overlook the role which s 64 of the Judiciary Act has played in confining liability to existing causes of action and to statutory liabilities in accordance with the basic rule. Section 64's role is consistent with the "affected by" doctrine and the policy of assimilating the liability of governments and individuals as far as possible in accordance with the basic rule. On balance, in the context of civil claims against government in the federal jurisdiction, the s 64 argument appears to have more merit as it emphasises the common law nature of liability through the "process of assimilation" and takes into account the nature of the federal jurisdiction. In support of this view it is important to note that there have been three unsuccessful attempts to amend s 64. These were prompted by concerns about the implications of the decision in Commonwealth v Evans Deakin Industries Ltd and the assumption that there is the same need to protect the States as a result of that decision31b All three attempts were defeated by the Opposition on the basis that both the policy behind that decision and the courts' application of s 64 of the Judiciary Act are sound. 317 Further, in an attempt to achieve uniformity, some of the States and Territories have enacted new Crown Proceedings legislation318 which provides that: [S]ubject to the Judiciary Act 1903 ... (a) proceedings may be brought by or against the Crown in the same way as proceedings between subjects; and (b) the same procedural319 and substantive law applies to such proceedings as in the case of proceedings between subjects. 320 313 (1994) 125 ALR 151; 34 ALD 413. 314 Ibid at 173; 433. 315 But on the facts of that case, which arose from changes to a fishery plan, he decided that in any event no action would lie for an act of "law-making". That is, it was not an act of "operational" negligence: see Anns v Merton London Borough Council [1977] UKHL 4; (1978) AC 728; Sutherland Shire Council v Heyman [1985] HCA 41; (1985) 157 CLR 424. Attorney-General's Second Reading Speech to 1989 Bill (H Reps Deb 1989, Vol 167 at 32983300). The three attempts were the Commonwealth and Commonwealth Instrumentalities (Application of Laws) Bill 1989, the Government and Government Instrumentalities (Application of Laws) Bill 1990 and the Law and Justice Legislation Amendment Bill (No 2) 1991. H Reps Deb 1989, Vol 168 at 873-894; Sen Deb 1991, Vol 149 at 3383 (Senator R Hill). Crown Proceedings Act 1992 (ACI); Crown Proceedings Act 1993 (NT); Crown Proceedings Act 1992 (SA); Crown Proceedings Act 1993 (Tas). The word "procedural" is omitted in the South Australian Act. 316 317 318 319 132 Federal Law Review Volume 24 Provision is also made for the retention of Crown immunity from statute321 and for "corresponding" laws of each State and other Territory to bind the Crown. These provisions attempt to pick up and clarify the meaning of s 64 of the Judiciary Act. In this complex area, a solution such as that provided by the constitutional argument is dangerously simplistic. What is in issue is the demonstrated role of the courts to provide adequate protection to individuals in claims against governments versus the assumed supremacy of government powers. The power of governments to modify their liabilities by legislation remains. Given the degree of self-interest of governments in such matters it is best that liability issues be left in the hands of the judiciary. However, guarantees that the role of the courts will not be undermined need to exist. The experiences in relation to s 51(xxxi) and in Victoria322 illustrate the limits of constitutional protection. In my view the current debate about whether there is need for a Bill of Rights in this country should be extended to incorporate the fundamental right of citizens to seek compensation from governments. 323 Where the civil liability of a government is in issue, the courts should enforce that right, rather than ensuring that the "dignity" of the Constitution is upheld. 320 321 322 323 Section 5(1) of each of the Acts. Section 6 of each of the Acts. See Australian Grand Prix Act 1994 (Vic), s 50. The legislation has the effect of denying the right of homeowners whose houses have been damaged by construction work on the Grand Prix track at Albert Park to claim compensation. See Age, 29 April, 1995 at 6 "GP offer sparks call for rights". Cf New Zealand Bill of Rights Act 1990, s 27(3). See Age, 20 February, 1996 at 14, letter to the Editor by R Richter QC, "Disquiet on rights a source of alarm".