Attorney-General of the Commonwealth of Australia v Alinta Limited & Ors
[2007] HCATrans 552
•2 October 2007
[2007] HCATrans 552
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S331 of 2007
B e t w e e n -
ATTORNEY-GENERAL OF THE COMMONWEALTH OF AUSTRALIA
Appellant
and
ALINTA LIMITED
First Respondent
TREWAS PTY LIMITED
Second Respondent
TAKEOVERS PANEL
Third Respondent
AUSTRALIAN SECURITIES & INVESTMENTS COMMISSION
Fourth Respondent
AUSTRALIAN PIPELINE LIMITED (IN ITS CAPACITY AS RESPONSIBLE ENTITY OF AUSTRALIAN PIPELINE TRUST
Fifth Respondent
GLEESON CJ
GUMMOW J
KIRBY J
HAYNE J
HEYDON J
CRENNAN J
KIEFEL J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON TUESDAY, 2 OCTOBER 2007, AT 2.15 PM
Copyright in the High Court of Australia
__________________
MR D.M.J. BENNETT, QC, Solicitor‑General of the Commonwealth of Australia: May it please the Court, I appear with my learned friends, MS M.A. PERRY, QC and MS E.A. COLLINS, for the appellant. I also appear alone for the third respondent. (instructed by Australian Government Solicitor)
GLEESON CJ: Are you seeking an order for costs against your client, the third respondent?
MR BENNETT: No, your Honour, the third respondent will be adopting the Attorney’s submissions.
MR J.R.J. LOCKHART: May it please the Court, I appear for the first and second respondents. (instructed by Blake Dawson Waldron)
MR P.J. HANKS, QC: Your Honours, I appear with MR S.P. DONAGHUE and MS F.I. GORDON. I foreshadow that I will be applying for leave for us to appear as amici curiae.
GLEESON CJ: We thought that the convenient course to take would be to hear the application to revoke the grant of special leave to appeal and your application at the same time.
MR HANKS: Yes, your Honour.
GLEESON CJ: Yes, Mr Lockhart.
MR LOCKHART: Your Honours, the Alinta parties have filed a summons seeking revocation of the special leave in whole or in part. It now appears that we no longer need to press for revocation in whole and possibly in part.
KIRBY J: You may not need to press it, but your submissions were so impressive and so persuasive that it does raise a question as to whether or not the Court needs to consider the matters that you earlier raised. I mean, this is not just a friendly little gathering of people sorting things out between themselves. This is an invocation of the judicial power of the Commonwealth.
MR LOCKHART: Yes, your Honour, I accept that it may have raised questions which ultimately the Court may need to consider.
KIRBY J: They were very good submissions, if I can say so, Mr Lockhart.
MR LOCKHART: The particular difficulty facing Alinta is one which I believe can be resolved by one or both of two methods. The particular problem that the Alinta parties face is that the orders made by the panel in 2006 for divestiture of the units in the Pipeline Trust simply cannot be resuscitated or reinstituted in any form by reason of the fact that the units have since been disposed of following orders by the Federal Court.
KIRBY CJ: That is still a rather powerful reason, is it not, for indicating that what is being pressed upon us is simply put before us as a vehicle to allow the Commonwealth to attack a declaration which has no current controversy between anybody, any parties, except Mr Hanks who wants to come in here and appear for amicus curiae, and when I go through the papers it turns out he is one of the amicus curiae, he is one of the amici himself. Anyway, perhaps I should ask this of him or of the solicitor.
GLEESON CJ: You were going to put a submission to us, Mr Lockhart, about how the matter could be resolved.
MR LOCKHART: Yes, the position that we find ourselves in is such that it can be resolved by two means. Firstly, the Attorney has indicated that he wishes to amend his notice of appeal so as to limit the grounds of appeal to just the constitutional matters. That would have the effect that ‑ ‑ ‑
GUMMOW J: To be specific to the declaration.
MR LOCKHART: Yes, your Honour. The declaration concerning the validity of section 657A(2)(b).
GUMMOW J: Which we see at page 265, volume I.
MR LOCKHART: That is right, your Honour.
GLEESON CJ: Yes.
MR LOCKHART: The second course, which we would say is a course that ought to be taken in addition to allowing the Attorney’s application to amend, would be that the Court amend the grant of special leave so that it is limited to the matters raised in the Attorney’s amended notice of appeal. In that way the Alinta parties have the comfort of knowing that whatever the outcome of the appeal on the constitutional matters there is no possibility of the panel’s divestiture orders being resuscitated or reinstated.
KIRBY J: Yes, but given the settlement of the commercial matter that brought this matter to the Federal Courts in the first place, have you any interest in defending or opposing the declaration?
MR LOCKHART: We do not, your Honour. We are only interested in ensuring that the Panel’s orders cannot in any way spring back into life.
KIRBY J: Could you lift your voice. I am not hearing what you want to say.
MR LOCKHART: I am sorry. The Alinta party’s interest is only to ensure that the Panel’s orders for divestiture of the units cannot in any way be resuscitated.
GLEESON CJ: Mr Lockhart, can you formulate, so I can take a note of what you said was the desirable course that we can take, what is the order you would have us make?
MR LOCKHART: The orders we would seek are that the Court grant leave to the appellant to amend the notice of appeal filed on 28 June 2007 in the form annexed to the Attorney’s summons and marked A, being the summons dated 31 August 2007.
GUMMOW J: That is not enough, is it? You need to start with a grant of special leave, do you not? Do you not need to amend the order of 267, which was special leave be granted from the whole of the orders to limit it to the declaratory order?
MR LOCKHART: Your Honour is correct. The first order ought to be that the grant of special leave be limited to the matters referred to in the Attorney’s amended notice of appeal.
KIRBY J: This is an entirely different grant of special leave than the grant that was made by the Court. So it really would seem to me, subject to what you say, to be a request that the Court substitute for the earlier grant of special leave a different ground. Is that not what you are now saying?
MR LOCKHART: The practical effect of seeking an amendment of the grant would be to delete one part of the grant but maintain the constitutional argument which was part of the original grant.
KIRBY J: Where do we actually find the grant of special leave?
GUMMOW J: Volume II, page 267.
MR LOCKHART: The original grant was in respect of the whole of the judgment and order of the Full Court of the Federal Court. If I can take your Honours to the orders of the Full Federal Court, which are found in volume I at page 264, the second of those orders was:
The order made by the primary judge made on 20 October 2006 dismissing the application be set aside and in lieu thereof –
firstly, there is the declaration in respect of section 657A(2)(b) being invalid, and thereafter follow various orders that the Full Court made. The order No 4 is the order with which we have a particular difficulty. The effect of an amendment of the grant of special leave such as to limit the matters the subject of the grant to, in essence, the matter of the declaration in respect of section 657A(2)(b) would be to amend the grant such as to carve out from the grant orders 3 and 4 of the Full Court orders.
KIRBY J: Could you help me, having read your written submissions. What is your interest to make this application now before this Court? What is the controversy that you are tendering that you have with the Commonwealth that underpins your application to this Court to take the serious step of granting special leave to appeal against that declaration, given that in your written submissions you have told the Court that the underpinning has disappeared and that you have no interest in the determination of that matter.
MR LOCKHART: At the time when special leave was granted the disputing commercial parties, being my clients and the Pipeline Trust, remained in dispute. At that point in time the units, the subject of the divestiture orders, remained within but were held by the Alinta parties.
KIRBY J: I know that, but you are making an application now for your client for the Court to do something in respect of a matter on which you, by your written submissions to the Court, have quite candidly acknowledged that you have no further interest. Well, why should we do something for you where you have revealed that you have no commercial or other practical interest in the matter? Why should we hear you any further on the matter?
MR LOCKHART: The answer to that, your Honour, is until such time as the Attorney obtains leave from this Court to amend his notice of appeal or until such time as the Court amends the grant of special leave, there does remain before this Court a request that order 4 in the Full Court order be set aside. If that was to occur, that would be an order directed to my clients to divest units which they no longer hold. So as at this point in time, my client ‑ ‑ ‑
KIRBY J: Are you seriously telling this Court that you are in some peril, your client is in some peril?
MR LOCKHART: Well, we think as a practical matter it most unlikely that any court would make such an order or allow such an order to occur, but until such time as the record is formalised the appellant is seeking to set aside the Full Court’s orders. In whole, if that was to occur there would ipso facto be an order of the Panel in existence requiring my client to divest units.
KIRBY J: When I think of all the pain and all the time and all the cost that goes into special leave applications, this one strikes me at the moment – just speaking for myself – to be one which is sustained by the least merit that I have heard in 11 years in the Court. I am not saying that critically of you.
MR LOCKHART: No.
KIRBY J: I do not know what has gone behind this change of position since the written submissions were presented, but the grant of special leave, or the continuance of special leave is a serious business.
GLEESON CJ: Does that cover what you want to say, Mr Lockhart?
MR LOCKHART: Yes, your Honour.
GLEESON CJ: Thank you. Yes, Mr Solicitor.
MR BENNETT: May it please the Court. First, I move on summons filed on 31 August to amend the notice of appeal. Your Honours will see that the proposed amended notice of appeal is on pages 279 and 280 and its practical effect is merely to reduce the existing notice of appeal. I do not need to amend the special leave because if the application is granted I am seeking something less than special leave granted me leave to seek. My learned friend wishes the special leave to be reduced to what I am now seeking and I do not oppose that.
KIRBY J: So his application is really immaterial?
MR BENNETT: Yes, your Honour. All I am seeking is what is in the amended notice of appeal, which is less than the previous notice of appeal and less than the grant of special leave.
KIRBY J: Well, it is immaterial except that we know that on his original written submissions he has revealed why it is now legally irrelevant; there is no cause or controversy.
MR BENNETT: I will come to that. Your Honour, there is a cause or controversy which I will come to. If your Honours wish me to deal with that now I am happy to do so.
GLEESON CJ: Yes.
MR BENNETT: What we submit is this. First, there are two totally separate questions that need to be considered quite separately. One is, is there still a matter under the Constitution and, two, if there is, should the Court permit this appeal to continue and those two issues should not be confused. May I deal with the second first. The second is easy. Section 78A of Judiciary Act provides that an intervener is a party, becomes a party. We intervened below and became a party. There was an issue as to whether the provision in an Act was valid or not. We fought that issue and we lost. We have a right of appeal. The Judiciary Act makes us a party with rights of appeal and we appeal against that decision against us.
GUMMOW J: I am not sure you even need the Judiciary Act because, do not forget that in the Boilermakers’ Case the Attorney for the Commonwealth who had intervened was the party who had unsuccessfully appeal at Privy Council.
MR BENNETT: Yes.
HAYNE J: The root of that is found in the ARU Case, namely, that there is a power that is in question whether, relevantly, legislative power subsists in the Commonwealth and there may then be further issues about the extent to which an intervening Attorney‑General is a party generally and the ambit of submissions that may properly be made in that guise, Mr Solicitor, for the reference to party I think is made in 78A(3), is it not, concerning rights of appeal and also in relation to the provision concerning costs?
MR BENNETT: Yes, your Honour.
HAYNE J: But at least to the extent of legislative power the Attorney’s interest is direct.
MR BENNETT: I should just say this to your Honours, although it does not arise in this case, that the construction of section 78A(1), for which we have always contended and the State Solicitors have always contended, is that one intervenes in proceedings being proceedings that relate to a matter arising under the Constitution and, therefore, once one intervenes one may make submissions on any aspect of the proceedings.
GUMMOW J: We know that.
MR BENNETT: But, your Honours, that is a controversy which need not be determined in this case.
GLEESON CJ: That is how we came to hear seven different arguments about the meaning of a Western Australian statute last week.
MR BENNETT: Yes. Yes, well, it has happened on a number of occasions and one day it may have to be debated, but that does not arise in this case.
GUMMOW J: Anyhow, there is another point too I think in your favour perhaps, Mr Solicitor, which is that Alinta I think raised the constitutional issue in the Full Court, did it not?
MR BENNETT: It did, your Honour.
GUMMOW J: When that happened under section 40 the Attorney could have removed it here.
MR BENNETT: Yes, yes.
GUMMOW J: What is now sought is some fact or method of avoiding that result by saying you cannot get special leave even though your Act has been held invalid.
MR BENNETT: Yes, and, your Honour, while it ‑ ‑ ‑
KIRBY J: But hovering over it all is In re Judiciary and Navigation Act and the requirement for a matter ‑ ‑ ‑
MR BENNETT: I am going to come to that, your Honour.
KIRBY J: ‑ ‑ ‑ and if the matter disappears and if you did not have it removed here when it was a matter you have still got to get over that hurdle.
MR BENNETT: I am going to, your Honour. I will come to that in a moment, but I wish to complete my submissions in relation to the general matter of whether assuming that there is a matter the Court ought to proceed. The other aspect is this. Let us suppose a simple dispute in which the issue is of importance to a party, and the issue of precedent is important to a party, the party fails, not only loses the case, but also has a precedent against it, and the opposing party comes to this Court and says, “I am not interested any more, I do not want to be heard as a respondent”.
That does not in any way eliminate the fact that the Court could and should in such a case hear the appeal and perhaps decide that the lower court was wrong. As I say, that is expressly contemplated by the provisions of section 78A which recognise that this Court does have a dual role. Its primary role, of course, is to decide matters which are disputes between parties, but in deciding whether to grant special leave it asks whether the question is important. It is the constitutional keystone of the federal arch, to use the cliché, and its decisions of constitutional matters are of the greatest importance.
In my respectful submission, where there is a decision below holding an Act to be invalid that was and is and has become a matter and a dispute quite independently of the original underlying dispute between the parties. Putting that a little differently, there was before the Full Court a matter involving a dispute between Alinta and us as to whether the section was valid or invalid. That matter is one which was decided, was decided adversely, and in relation to which we have a right of appeal.
Now, the only hurdle, therefore, is whether there is a matter, and there are a number of answers to that. The first is that this is a continuation of the determination of a matter. Might I remind your Honours what was said in Mellifont ‑ ‑ ‑
GUMMOW J: Another point too, Mr Solicitor. It is a fallacy to think that in the Federal Court there was only one matter.
MR BENNETT: Yes.
GUMMOW J: There was a matter arising under section 76(2) of the Constitution plus 77(3) under the corporations structure, and as you say, there was a constitutional matter, too.
MR BENNETT: Yes, and the mere fact ‑ ‑ ‑
GUMMOW J: And it is that one that has you agitated?
MR BENNETT: Yes.
GUMMOW J: It is the outcome of that one so far that has you agitated.
KIRBY J: But who are the parties to that matter?
MR BENNETT: Well, all the parties were parties to it in one sense, but primarily Alinta and us.
KIRBY J: Yes, but now we are told by Alinta that they have no real interest in resolution of that matter ‑ ‑ ‑
MR BENNETT: They no longer ‑ ‑ ‑
KIRBY J: ‑ ‑ ‑ so it is just you and Mr Hanks.
MR BENNETT: Well, your Honour, I will come to Mr Hanks in a moment. But the first point is that there was, as I say, a matter below and an appeal from that remains available, notwithstanding that one party comes to this Court and says, “I no longer care”.
KIRBY J: It is not that they do not care, they say their controversy has been quelled. They do not have any further dispute which they bring to the judicial branch.
MR BENNETT: But we still do, your Honour. We are the other party to it.
KIRBY J: I know you do, but you do not have it with them. Who do you have it with?
MR BENNETT: We have it ‑ ‑ ‑
KIRBY J: You have it with the Federal Court.
MR BENNETT: I have it also with Alinta because Alinta persuaded a court that a provision was invalid and, in a situation where we have a right of appeal. That matter continues notwithstanding that Alinta says, “We do not care any more”. May I just draw a distinction. It is possible – and this is the old case of Williams v Carmichael – for this Court to allow appeals by consent, although it forms no view on the merits.
KIRBY J: But it does not normally give lengthy reasons expounding the Constitution, which is what, presumably, you are seeking from us.
MR BENNETT: No, your Honour. I am using the argument in a different way. It is one thing to allow an appeal by consent; it is another for a respondent party to say to the Court “I no longer contest this issue; therefore there is nothing for the Court to decide”. That is a different question. We come to the Court seeking relief. Obviously the relief we want is a judgment and an allowance of the appeal and a declaration the other way. But it is no answer to that to say, “Why should the Court do it because the other party no longer has any interest in the matter?” The problem that there is no contradictor has been dealt with by the course which the Court has adopted in other cases. I will give your Honours an example in a moment.
KIRBY J: This is the participation of Mr Hanks and his colleagues.
MR BENNETT: Yes, your Honour.
KIRBY J: Well, I have heard of cases coming to the Court – Marquet was one – where there were real amici but this is amici as counsel.
MR BENNETT: That was the Builders Labourers Case.
KIRBY J: In the Marquet Case, which is footnoted heavily in the submissions, there was a group of people in Western Australia who had a real interest in the issue. They were people who were contending in favour of unequal electorates in Western Australia. They were allowed to intervene as amici.
MR BENNETT: There is a view which says they were not true amici; they really should have been given leave as interveners.
GLEESON CJ: Exactly. I thought that the application that used to be made was an application to appear as amicus curiae, not to appear for an amicus curiae.
MR BENNETT: That is correct, your Honour. They are appearing as amici curiae. The Builders Labourers Case was a case where, after the decision in the case had been indicated, the unsuccessful party sought an order for costs from a federal fund under the Federal Proceedings (Costs) Act which said, in effect, like the State ‑ ‑ ‑
GUMMOW J: Justice Heydon was counsel in that case.
MR BENNETT: Yes, he was. His Honour appeared with me in that case. We were jointly amici curiae of the same type that my learned friends are in this case.
KIRBY J: But you might have had an interest in the costs that sharpened your submissions. Mr Hanks’ only interest in the costs is that you have rustled him up, got him involved and promised to pay his costs so that he would come along and argue in this Court. It is not the sort of thing that necessarily means that they have the interest in it, or the heart in it, that you have if you are a party, which I have always understood to be the reason behind this Court’s refusal to give advisory opinions – sharpening the issues by interest.
MR BENNETT: In the Builders Labourers Case, as I have said, a party sought an order under the Federal Proceedings (Costs) Act having been unsuccessful. The opponent, the successful appellant, said, “We support that” – because obviously the appellant wanted the respondent to have the wherewithal to pay the costs. So the parties were in the same interest. The Chief Justice, Sir Harry Gibbs at the time, said he thought there was an argument that the provision was invalid because, on one view of it, it allowed the Court to make an order which the Attorney‑General had a discretion to comply with in relation to paying the parties’ costs. But neither the appellant nor the respondent was interested in arguing for that. So it was suggested that Sir Maurice Byers, the Solicitor‑General, come to put that argument. Sir Maurice said, “No. The Commonwealth argues that the provision is valid”, as it always does. So there was still no contradictor. Arrangements were then made administratively ‑ ‑ ‑
KIRBY J: It does not always do so. I recollect recently in the case concerning Nauru it did not.
MR BENNETT: It did not appear, your Honour. When I said always does, what I was intending to indicate was that it never argues for invalidity of its own laws.
KIRBY J: It did not turn up to defend its own laws on that occasion.
MR BENNETT: No, it did not in that case.
KIRBY J: What is the citation of the Builders Labourers Case?
MR BENNETT: Yes, I am just having it brought down, your Honour. I had thought it was here.
GUMMOW J: It is 152 CLR 179.
MR BENNETT: Yes I am indebted, your Honour. (1982) 152 CLR 179. I was describing what occurred in that case. So there was then a request through the Registry that – no doubt from the judges – that amici curiae of this type be appointed. I and Justice Heydon received a brief from the Australian Government Solicitor to appear for ourselves as amici curiae, exactly as the amici curiae appear in this case, for the purpose of arguing that the section was invalid.
GLEESON CJ: You do not appear for yourself. You appear as amicus curiae.
MR BENNETT: Yes, your Honour, but there is no client.
KIRBY J: Well, why are you dressed up in the robes of counsel?
MR BENNETT: There is, your Honour, a discussion in Halsbury about that question, under the heading “Barristers”. There is contradictory authority as to whether a barrister appearing for himself as the litigant should or should not robe. There is authority that the barrister has the right to robe, there is authority that he or she should not and ‑ ‑ ‑
GLEESON CJ: There seems to be a confusion. An amicus curiae is not a litigant.
MR BENNETT: Exactly, your Honour, it is a friend of the court. In the same way the traditional amicus curiae was someone sitting in the back of the court who, seeing a litigant in person floundering, rushed forward and said, “What about the case of Donoghue v Stevenson?”
KIRBY J: They would probably be told to resume their seat.
MR BENNETT: Yes. Your Honour, that was the traditional amicus curiae. It is counsel assisting the court as a friend of the court. Where there is no other contradictor and it is desirable that the arguments be put in defence of a judgment below in this case or in opposition – defence of a judgment below in this case, that procedure is a very convenient one. It was adopted in that case, although the report does not refer to it, and the transcript does not refer to it, although in fact there was some comment at the time which is not reported in the transcript which I can tell your Honours about. What happened was when I sought leave to appear as amicus curiae, Justice Murphy said “Why should we grant that leave?” The Chief Justice then turned and had a whispered confabulation with his Honour. His Honour then said he was satisfied and the matter proceeded and leave was granted. No doubt ‑ ‑ ‑
GLEESON CJ: It was probably a whispered consultation.
MR BENNETT: Consultation yes, your Honour. No doubt what was said was, “They’re there at our request”.
KIRBY J: Do not assume I would be put off so easily as Justice Murphy was.
MR BENNETT: Maybe not, your Honour. The point is that it is, in my respectful submission, a convenient procedure in a case where a party no longer wishes to put an argument that was put below and ‑ ‑ ‑
KIRBY J: Well, it is very odd. Mr Hanks is amicus curiae. He appears here as counsel in his robes. He is paid for by you.
MR BENNETT: Yes.
KIRBY J: He has no personal interest in the matter at all. He does not have the interest that will sharpen his desires and his anxiety to win. He has no other person behind him like the Western Australian interveners in Marquet, who have a genuine and real interest in the matter, and it seems to bring us to the very edge of In re Judiciary and Navigation Act. In North Ganalanja I expressed the view that perhaps we should reconsider the principles in that case, but the Court has not done so, you are not asking us to do so, so it is a question of remaining consistent with what the Court has said in the past.
MR BENNETT: Yes. Your Honour, the ‑ ‑ ‑
KIRBY J: Could you just explain this to me, it might help. Mr Lockhart, in his very helpful submissions, pointed out at page 10 that there would be easy ways by which a challenge to the decision below could be brought to the court without going through these hoops and dealing with it, though the dispute between the original party has disappeared. It occurs to me it could either be done by a fast track from the Federal Court in a matter concerning the Panel in the Federal Court or by the Federal Court convening a Bench of five and reconsidering the matter for itself and thereby perhaps sparing this Court of any need to be concerned in the matter. But meantime we have this decision, and the controversy between the parties to it seems to have disappeared.
MR BENNETT: But it has not disappeared, your Honour.
KIRBY J: You say that, but you have invented a controversy by getting Mr Hanks here.
MR BENNETT: No, your Honour, I am sorry, your Honour.
KIRBY J: You are paying for him.
MR BENNETT: Your Honour is putting together two totally separate ideas that have nothing to do with each other, the question of the means which has been adopted to deal with the problem of the absence of the contradictor and the problem of the Constitution In re Judiciary and Navigation Acts.
KIRBY J: The absence of the contradictor is the essence of one of the problems that is presented for the reason for which this Court has said in In re Judiciary and Navigation Acts it will not embark on hypothetical questions, moot questions, questions which have become moot. Now, is there any problem in what Mr Lockhart said in paragraph 23 that the matter could come here quickly from the Takeovers Panel or from the Federal Court or somebody could object to the Takeovers Panel relying on the decision of the Federal Court and be up here like a flash on the next occasion. He says here, and this is what I noted, “Disputes before the Panel are not rare.” Is that a factually correct statement or not?
MR BENNETT: That is a correct statement, your Honour.
KIRBY J: If they are not rare, then the matter could come before this Court in an entirely regular way between parties who want to win.
MR BENNETT: Your Honour, it would have to be a dispute before the Panel involving the particular paragraph which was held to be invalid, which is a narrower category of disputes before the Panel.
KIRBY J: You say that is not a live issue? It is not likely to arise again?
MR BENNETT: It will arise again, your Honour. It is a very important issue, but it is not quite as frequent as matters before the Panel. That is all I am saying about that. Your Honours, as a practical matter, to go through those hoops, and they would be real hoops, much more serious hoops than this matter, would probably not be able to be done this year. It might involve upsetting other matters that are set down for hearing. It would involve getting a full Bench of five of the Full Federal Court, having it determine it and they might reserve on it for some months and in the meantime we have a real problem with the Panel trying to exercise jurisdiction and litigants saying you cannot validly do this. That is a matter of great urgency and great public concern. We have got before this Court very quickly with what is, we would submit, a very trivial hoop and ‑ ‑ ‑
KIRBY J: Trivial what? I did not hear the noun.
MR BENNETT: Hoop, your Honour.
KIRBY J: Hoop?
MR BENNETT: I am disagreeing with your Honour’s use of the word “hoops”. What is being suggested would involve many more hoops than that.
KIRBY J: It would involve a little delay and that is unfortunate, but that is the law. If it is the law, then ‑ ‑ ‑
MR BENNETT: If it is the law.
KIRBY J: - - - then it has to be conformed to and you would be challenging a bare declaration.
MR BENNETT: Your Honour, this is why I am at pains to distinguish between the constitutional principle and any question of discretion. What I have been saying substantially thus far is that once the constitutional argument can be overcome, the elements of discretion are 100 per cent in favour and zero per cent against hearing the matter today with the amici curiae as the contradictors. I then turn to the constitutional argument and the issue was decided by this Court in Mellifont v Attorney‑General 173 CLR 289.
KIRBY J: That was State legislation concerned with the determination of matters before Courts of Criminal Appeal, was it not?
MR BENNETT: Yes.
KIRBY J: That was a particular procedure in the State laws.
MR BENNETT: Yes, but, your Honour, the effect of the decision was that because there had been a matter for the purpose of appeal there still was even though the effective allowance of the appeal would not affect the rights of the parties. That is the ratio of Mellifont. In my respectful submission, it is that which enables me to distinguish re Judiciary and Navigation Acts. Putting it in slightly different words, once a matter always a matter. All this Court is being asked to do is deal with what is left over from a matter before the court below and to deal with it and the matter does not cease to exist merely because the parties resolve their dispute. There are all sorts of situations in relation to which a matter may continue for some purposes although the parties have settled.
I suppose one example might be if – a slightly whimsical example – the plaintiff in a proceeding in the court below paid the filing fee on the originating process by a cheque which subsequently bounced, the parties then settled the matter and the registrar wished in the proceedings as part of the proceedings to enforce payment of that filing fee. It would be no answer to say the court could not do it because there is no longer a matter.
KIRBY J: I do not think that is a very good analogy with the situation where, in effect, the parties have resolved their dispute and you then want to create a different dispute ‑ ‑ ‑
MR BENNETT: No, your Honour, where a party ‑ ‑ ‑
KIRBY J: ‑ ‑ ‑ with Mr Hanks expressing the view in the different dispute.
MR BENNETT: It is not a different dispute, your Honour. There were two disputes before the Court ‑ ‑ ‑
KIRBY J: Well, it is not a dispute between the parties in the Federal Court who are the appellants here.
MR BENNETT: We are a party in the Federal Court, your Honour. We were party to that dispute. We are aggrieved ‑ ‑ ‑
KIRBY J: That is right, you are the appellants here, but you have lost your respondent.
MR BENNETT: Yes, and ‑ ‑ ‑
GUMMOW J: You have not lost them, they will not come out and fight. That is the problem.
MR BENNETT: Precisely.
KIRBY J: They have no interest to fight, to sharpen the controversy.
MR BENNETT: And we have solved that problem with the amici.
GUMMOW J: If I can finish, what you have is a declaration of invalidity against you, which is the highest form of constitutional resolution, and it is not a bare declaration, it is one of seismic importance throughout the whole of the administration of the corporations system in the country.
MR BENNETT: Of course, it has practical effect, quite apart from its precedential value between the parties as res judicata. If, supposing there were a fresh matter to come before the Panel unrelated to the present one involving Alinta, it would be entitled to say to the Panel, there is a res judicata that you cannot decide this, quite apart from the way other parties may rely on it as a precedent.
HAYNE J: Well, be that as it may, to tie the rights of the Attorney to the attitudes of the parties would seem to cut down 78A(3) of the Judiciary Act.
MR BENNETT: Precisely, your Honour.
HAYNE J: Section 78A(3) gives the Attorney a right of appeal which is separate from and distinct from the attitudes of other parties to the litigation in which the Attorney has intervened. There is a declaration against the polity, the Attorney in question represents that legislation of that polity is invalid.
MR BENNETT: Yes, and, of course, in the Builders Labourers Case there was no party who had an interest in having the legislation held to be invalid, except possibly the Commonwealth who would have to pay under it, which declined to seek that. So exactly there as here there was a suggestion of invalidity made by the court in that case and every party and every possible party wanted to uphold validity. The respondent wanted it because it wanted its money under the section, the appellant wanted it because it wanted the respondent to have the wherewithal to pay its costs, the Commonwealth wanted it because it wanted its Act to be valid, so there was no one to oppose it.
But it was a constitutional issue which the Chief Justice had expressed concern about, and therefore a party with no interest was – or two people with no interest were briefed to appear as amici and put the – and your Honour says they do not have the fire of a party with real interest, but your Honour, members of the Bar who are responsible members of the Bar and who are briefed to present an argument like that will argue it with just as much force as if there was a live client ‑ ‑ ‑
KIRBY J: Please understand me. I did not cast any doubt on the vigour with which Mr Hanks and his colleagues have argued the case. They have put forward some very good arguments. The question is whether it is within the principle which this Court has embraced from the early days of the Commonwealth.
MR BENNETT: Yes.
KIRBY J: The problem that I have is that you say it is because you can - though the original parties have no interest in fighting the appeal, you say you can render it acceptable within the Judiciary Act principle because you pay the costs to sharpen the dispute by providing the contradictor, and that is something that rather suggests that you as the Attorney‑General can, in effect, buy your way into the jurisdiction of the High Court, which I am not inclined to think you can.
MR BENNETT: No, your Honour. I come here as a person with an order against me. I come here as a person with an order against me who seeks to appeal against that order.
KIRBY J: Yes, but you do so in proceedings, you see. Section 78A(3) says you should be “taken to be a party to the proceedings”. What are, or were, the proceedings? The proceedings were the proceedings between Alinta and you.
MR BENNETT: Yes.
KIRBY J: And those proceedings are now of no further interest to Alinta.
MR BENNETT: Your Honour, let me give this analogy. Suppose one has a defamation case where a plaintiff brings an action because the plaintiff is concerned about his reputation. The plaintiff fails and appeals. The respondent says, “I have no interest. I think that damages would be very modest in any event and therefore I don’t propose to appear in the High Court, I don’t turn up. I have no commercial interest in these proceedings. I don’t care what you do”. Now, that could not stop the plaintiff proceeding with his appeal. It might be a factor whether he got special leave, but there would still be a matter. The plaintiff is entitled to say “There is a matter. I have a decision of a court which says that this material was not defamatory of me. That is something which affects my reputation. I come to the court” – “there certainly was a matter before the lower court. I come to the court as something arising out of that matter to be heard. It’s the same matter”. My learned friend cannot stop there being a matter by saying “I don’t care any more”.
KIRBY J: He does not say that. He says he has settled his dispute. The commercial basis of the litigation has disappeared.
MR BENNETT: He has not settled his dispute ‑ ‑ ‑
KIRBY J: It is no longer a controversy.
MR BENNETT: Your Honour, he has not settled with us, and we were party. He sought and obtained an order that an Act was invalid. That has not been settled with us, he cannot settle that with us obviously, but he has not. He has not and he cannot. Your Honour, it is the same situation. There is a live issue affecting my client.
KIRBY J: Assume the settlement had happened earlier, before the special leave hearing, and you had come up to the special leave hearing.
MR BENNETT: Yes.
KIRBY J: Do you not think there would have been a risk that the Court might say “This is not a suitable vehicle. We’ll wait for a case where there is a dispute which is still alive and which engages the jurisdiction of the court in the normal way between parties who want to fight for their cause”.
MR BENNETT: That would have been a matter of discretion which would have been arguable, we would have argued to the contrary, but as a matter of power ‑ ‑ ‑
KIRBY J: Do we not have a matter of discretion now?
MR BENNETT: I am sorry, your Honour, I thought I was addressing a constitutional point now. If your Honour wishes me to come back to the discretion I will. But they are nothing to do with each other, and they cannot be exchanged ‑ ‑ ‑
KIRBY J: But we have a special leave discretion, do we not, whether to revoke it, to put it quite bluntly.
MR BENNETT: Yes, your Honours have that discretion. That is why I have addressed on discretion. What I am trying to say to your Honour is that one cannot put the two together as if they had something to do with each other. They have nothing to do with each other. There is a dry technical re Judiciary and Navigation Acts constitutional question as to whether there is still a matter. Then there is a practical discretionary matter as to whether we should be permitted to proceed with this appeal. One cannot debate them in the same breath. One has to deal with one and deal with the other.
KIRBY J: They are interconnected. If you do not have a matter you do not – one of the reasons is because you do not have a sharpened controversy or a controversy – a dispute to quell.
MR BENNETT: Well, your Honour, if that were the case one could never have argument on an appeal ex parte. If one goes back to my defamation case, the defendant may say “I am not interested. The amount is so small I don’t care. I decline to brief counsel at the High Court. I decline to put argument to the High Court”. That would not stop the High Court hearing the plaintiff’s appeal. In the same way, my learned friend here has the benefit of an issue estoppel or res judicata – both. He says “I don’t care about that”. The fact that he says he does not care does not matter. There is a real live issue. We want among other things to dispose of that, which is one effect that allowing the appeal will have, exactly as the plaintiff in the defamation case I have hypothesised says “I want my verdict” even though the defendant does not care.
Your Honour, in my respectful submission, there is clearly a matter and Mellifont makes that clear where it says, in effect, that one of the reasons there was a matter in an appeal by the Crown against acquittal, where the appeal could not affect the status of the accused person, the Court said “Yes, there was a matter. You are aggrieved by the decision against you. The statute grants you a right of appeal”. It does not prevent it being a matter that the Court resolving it is not going to affect the rights of the other party.
If the other party had chosen not to be represented in Mellifont – in fact, just looking at Mellifont, I am not sure the respondent was represented. No, the appellant there was the ‑ ‑ ‑
GLEESON CJ: Mr Solicitor, if we were minded to grant you leave to amend the notice of appeal in the manner that you seek, is there any reason why we should not, before making that order, make an order of the kind proposed by Mr Lockhart, that is to say, that the order granting special leave to appeal in this matter is amended by limiting the grant of such leave to the issue, the subject of your proposed amended notice of appeal?
MR BENNETT: We do not accept it is necessary, but we have no objection to that course. We see that as a sensible way of dealing with it. If my learned friend seeks that, I do not oppose it. Mellifont, of course, is a stronger case than this one because the appellant there had no interest. The appellant was not affected by the result below. Here the Attorney is affected in three ways, by the declaration, by the precedent, of course, and by the fact that Alinta has the benefit of a res judicata if it ever gets before the Takeovers Panel again in another matter. The mere fact that it does not care about that is of no significance any more than the hypothetical defendant in the defamation case who does not care about the small verdict.
In re Judiciary and Navigation Acts does not stand for the proposition that where there is no contradictor who has an interest to contradict, the Court cannot proceed. All that it says is that one of the reasons why there needs to be a lis inter partes is that it is desirable that there be a contradictor. But the converse proposition is not part of the ratio of that case. That is demonstrated by the more recent authority of Builders Labourers Federation where the Court heard amici in exactly the same situation that we have here because there was a constitutional argument that otherwise would not have been put to the Court that something was invalid.
In that case the constitutional argument emanated from the Court. In this case it emanated from the court below at the request of a party but in either situation one has a constitutional argument with no contradictor and there is a simple procedure available which has been availed of to solve that problem. It is the ethics of the Bar which have the practical effect from the point of view of discretion that it simply does not matter that Mr Hanks and his juniors do not have behind them a flesh and blood client. That just does not matter. They will argue, they have in their submissions and will before this Court, just as powerfully as they would if there were a sobbing widow behind them. In my respectful submission, that cannot go to the question of constitutionality or the existence of a matter.
KIRBY J: It is a very broad view of amici in the court. I have made a note of your argument and will remind you of it in future cases. Amici and interveners have not generally had a friendly welcome in the court.
MR BENNETT: Interveners are quite different to amici, your Honour. Interveners are where someone who is not a party says, “I have an interest in what is being debated because of the precedent importance of the case and I want to be heard for that reason” and the intervener then instructs counsel who seeks leave to intervene and the intervener becomes a party. That is one procedure. That is the procedure that probably should have been followed in Marquet. I never understood why it was not but no one took the point. An amicus is usually a barrister, a person who comes to the court and says, “I am prepared to assist. You have a problem here.”
GUMMOW J: In Levy v Victoria 189 CLR 579 at 604 Chief Justice Brennan, speaking of the role of amicus, treated it as one that involves this idea. Are the parties unable or unwilling to assist the court in arriving at the correct determination of the case and here that seems to be so.
MR BENNETT: Precisely, your Honour, as it was in Builders Labourers.
KIRBY J: But in Levy there were true and continuing parties.
GUMMOW J: They were not let in.
MR BENNETT: Yes, your Honour, and the applications to intervene in that case were genuine applications to intervene. The point being made in the passage that was just referred to was simply to make the distinction between amici and interveners and, as I say, the Marquet people should have been interveners.
KIRBY J: I am aware of the distinction between amici and interveners and generally this Court has been, as I recollect it, more welcoming to interveners than to amici. You are urging a new open‑door policy to amici. I am just warning you.
MR BENNETT: It has occurred twice in the history of the court that it has been necessary, your Honour. It arises when the parties are not prepared to put an argument because none of them have an interest to put an argument that needs to be put for there to be a contradictor and in a case where the absence of a contradictor was – even if the defamation case I hypothesised would be open to an amicus to come along at someone’s request and say, “We will argue as a matter of law why the decision below should stay”.
KIRBY J: Amici are very common in the United States Supreme Court. Perhaps they will become more common here.
MR BENNETT: They are what we would call interveners, your Honour. In the United States they use the words “amicus curiae” where we would use the word “intervener”.
KIRBY J: I am not sure of that. I do not think that is so. Many human rights and other organisations intervene to put arguments in the United States Supreme Court, not as interveners but as true helpers to the court.
MR BENNETT: Your Honour, that is the classic role of the intervener. The organisation which has an interest in the decision because of usually the precedent value, occasionally other purposes, and it may be rendered necessary because of narrow rules about standing, the Australian conservation case and so on. This, in my respectful submission, is a classic case where there is still a matter where there is a party with a real interest, my client, and that interest should be heard and, if necessary, vindicated and the problem of the contradictor can be dealt with by a simple method and that method has been used and will be effective.
KIRBY J: It can hardly be a classic case if they have only been – well, there has only been one other in the history of the Commonwealth.
MR BENNETT: Your Honour, a classic case can occur in a rare situation. It is a principle which only arises in those cases and, in that sense ‑ ‑ ‑
KIRBY J: Or two of them.
MR BENNETT: But for those reasons it is my submission that special leave should not be revoked but that orders should be made in accordance with the summons. I formally read, although I do not actually read, the affidavit of Jens Thomas John of 31 August.
GLEESON CJ: Thank you, Mr Solicitor. Yes, Mr Hanks.
MR HANKS: Your Honours, I move on the summons filed on 25 September in which we, that is I, Dr Donaghue and Ms Gordon, seek the Court’s leave to intervene in the appeal as amici curiae for the purpose of opposing the appeal. The basis on which we do so is in part spelt out in the supporting affidavit affirmed by James Richard Faulkner on 20 September 2007, that is, that unless we are heard, we are granted leave to intervene as amici, there will be no one to contradict the Attorney’s arguments. The principle upon which our application is based is, as our learned friend the Solicitor and Justice Gummow pointed out, the principle recognised by the former Chief Justice, Sir Gerard Brennan in Levy v State of Victoria and that is that we are willing to offer the Court submissions on law and relevant fact which will assist the Court in a way in which the Court would not otherwise be assisted because there will be no one else to oppose the Attorney’s arguments.
KIRBY J: Remind me of who the amici were in Levy? They were real people with a real interest, were they not, of their own ‑ ‑ ‑
MR HANKS: They were those who sought to intervene to, I think, agitate in support of the implied right of communication.
KIRBY J: Whereas you have no personal interest, you or your colleagues.
MR HANKS: No. The only interest we have, your Honour, is an interest to assist the Court, that is, to present the Court with arguments which will not otherwise be presented, arguments in support of the declaration made by the majority in the Full Court and in support of their reasoning, opposed to the Attorney’s arguments.
KIRBY J: But you were not involved in this until the Solicitor‑General of the Commonwealth picked you out sitting quietly in your chambers to come along and take this brief.
MR HANKS: Your Honour assumes too much. I have no understanding that my learned friend had any influence in my selection at all.
KIRBY J: I am just referring to what it says in the affidavit of Mr Faulkner.
MR HANKS: Your Honour will find that it does not say that. But that is, if I might say so ‑ ‑ ‑
KIRBY J: I see, Mr Faulkner approached you. “I approached Mr Hanks”.
MR HANKS: If I might say so, your Honour, that is somewhat beside the point. The only question for the Court in the exercise of its ‑ ‑ ‑
KIRBY J: You were brought into the case by the appellant.
MR HANKS: I was brought into the case at the request of the Attorney, that is so. The communications I had were with Mr Faulkner, as the affidavit makes clear, and it was at the invitation of Mr Faulkner that I and Dr Donaghue and Ms Gordon agreed to approach the Court for leave to intervene and that is what we are now doing. Might I say this, that the only question for the Court in the exercise of its complete discretion is whether it is of the opinion that it will be significantly assisted by the submissions that we make.
KIRBY J: I think the Solicitor-General for the appellant is trying to help you.
MR HANKS: That being the proposition that Sir Gerard Brennan identified as the critical question that would guide the Court’s discretion in Levy. That is the only question for the Court. Will you be assisted by the submissions that we will make? Your Honours have had the opportunity possibly to see that we put some submissions in writing. We say without any modesty that they should be of some assistance to the Court. I should make clear ‑ ‑ ‑
KIRBY J: I think the Solicitor‑General wants you to read us something.
MR HANKS: I think my learned friend is concerned that I make clear something in response to a question that your Honour foreshadowed a little earlier. We do appear as amici, not for the amici. If we are given leave, we will be the amici curiae, just as the learned solicitor in his former life before he became Solicitor‑General and your Honour Justice Heydon appeared as amici in the case of Victoria v Australian Building Construction Employees & Labourers Federation (No 2).
KIRBY J: The only other example of this procedure.
MR HANKS: That may be so, your Honour, but it is unusual that a matter comes to this Court without an active contradictor and it is to fill that particular gap that we make our application for leave.
KIRBY J: It is unusual because when cases are disposed of in the proceedings they normally go away and we are not troubled.
MR HANKS: I cannot offer any comment on that, your Honour. We are responding to a particular situation which is before the Court.
GLEESON CJ: Thank you, Mr Hanks.
MR HANKS: Thank you, your Honour.
GLEESON CJ: We will adjourn for a short time to consider the course we will take.
AT 3.22 PM SHORT ADJOURNMENT
UPON RESUMING AT 3.23 PM:
GLEESON CJ: At least a majority of the Court is of the view that the following orders should be made and they are now made.
1.The order granting special leave to appeal in this matter is amended by limiting the grant of such special leave to the issue the subject of the appellant’s proposed amended notice of appeal.
2.Leave is given to the appellant to amend the notice of appeal in the manner appearing on pages 279 and 280 of the appeal book.
3.Mr Hanks of Queen’s Counsel, Dr Donaghue and Ms Gordon have leave to appear as amici curiae.
Mr Lockhart, we are always pleased to see you but there is no need for you to remain if you want to go.
MR LOCKHART: I am grateful to your Honour.
GLEESON CJ: Is there anything about costs that we have to deal with?
MR LOCKHART: The only matter I wanted to raised was simply this. There has been some suggestion that we do not seek costs. All I would say in that respect is, if the Attorney is unsuccessful in his appeal, then we seek our costs of the appeal.
GLEESON CJ: We have noted that submission. Thank you, Mr Lockhart.
MR LOCKHART: If it please the Court.
GLEESON CJ: Yes, Mr Solicitor.
MR BENNETT: It may be convenient to answer that before my learned friend leaves and before I get to my primary submissions. I simply invite your Honours to read the correspondence annexed to Mr John’s affidavit. Your Honours will see that we were always ready and willing to do, in effect, what has been done and what has now been accepted. The costs such as they are have been incurred because my learned friend’s clients first indicated an interest in that and then took the contrary view and then finally reverted to accepting what we had always proposed. For those reasons it is my respectful submission that there should not be any order for costs whether or not we succeed in the litigation as against Alinta.
GLEESON CJ: Mr Lockhart?
MR LOCKHART: Yes, briefly in response, your Honours. Firstly we say that there was some correspondence passing between my instructing solicitors and the Attorney’s solicitors. It took some time and some variations before the form of the amendment was settled upon. Secondly, if I can indicate that it was necessary, in our submission, for the steps to be taken for us to appear because until the Court agreed to allow the amendment that the Attorney‑General has proposed, my client was still exposed to the possibility of the Full Court’s orders being reinstated and that is a position which the Alinta parties found themselves in as a result of the Attorney wishing to agitate the appeal.
KIRBY J: This is a matter where we have the return of an appeal by special leave in which you are a party and which, on the face of things, you had to come along and do something to extricate yourself from any risk, which you have done. So it seems a little ungracious of the Attorney‑General in all the circumstances to resist the payment of your modest costs for all the help you have given the Court.
GLEESON CJ: Thank you, Mr Lockhart. We will take all that on board. Yes, Mr Solicitor.
MR BENNETT: If the Court pleases. Your Honours, in Precision Data Holdings Limited v Wills (1991) 173 CLR 167, this Court unanimously held that the predecessor provisions to those challenged in this case were valid. No one, neither the amici nor anyone else, and certainly of course not the court below, has suggested that that decision should be overruled. So the only question is is it distinguishable?
HAYNE J: The legislation is different, is it not, Mr Solicitor?
MR BENNETT: Yes, on the basis of the new legislation. That is what I meant to say.
HAYNE J: I know you want to get a ball off the table and into the pocket early by saying it is a question of distinguishing, but you have to start with the legislation, do you not?
MR BENNETT: Yes, I do. Your Honours, that is the way the Full Court approached it.
KIRBY J: What is the way the Full Court approached it? By starting with the legislation?
MR BENNETT: Well, by saying quick decisions are to be distinguished. Decisions are to be distinguished.
KIRBY J: What Justice Hayne has put to you is what the Court has been putting to counsel for the last seven years – that the proper place is to start with the legislation – because Mr Hanks makes the point that the legislation has significantly changed.
MR BENNETT: Yes. Your Honours will see that at page 245 of volume I of the appeal book at paragraph 399 in the judgment of the majority, your Honours see that their Honours say:
There are at least four significant differences between the present legislative provisions and those considered by the High Court in Precision Data Holdings -
My submissions will be divided into three sections. I will first deal with those four differences to show that they are not relevantly significant, or they do not at least affect the result. I will secondly deal with the issue of Brandy, which is one of the bases relied on by the majority in paragraph 408 of the decision. Your Honours will note that in the third‑last line of paragraph 408 on page 250, they say that the provisions “provide stronger methods of enforcement”. We will be submitting they provide weaker methods of enforcement, thus showing that Brandy ‑ ‑ ‑
GUMMOW J: Mr Solicitor, at the stage of the earlier case did the legislation have divestiture provisions in it?
MR BENNETT: Yes, it did.
GLEESON CJ: At the stage of the earlier case the parties could go to the court during the takeover period and argue that there had been contraventions of the law, could they not?
MR BENNETT: Yes, your Honour, they could. The third and final part of my submissions will be a closer analysis of Precision Data itself, showing how in a positive way it is applicable to the legislation. One starts then with the first distinction relied upon by their Honours. Of course your Honours appreciate this is a case where, of the four members of the Federal Court who have expressed a view on the question, two decided it each way which means of course that the appeal against Justice Emmett was allowed by majority. So we put it on the merits as a 2:2 case, although of course ‑ ‑ ‑
KIRBY J: You know as well as we do it does not matter the numbers, it matters where they are.
MR BENNETT: Of course. Now, the first of the four differences appears in paragraph 399(1) at page 245 and it depends on the significance of the Panel making a declaration based on a contravention. Now, may I just show your Honours what the section says. Do your Honours have the Act? It is section 657A.
GLEESON CJ: Is this the Corporations Act 2001?
MR BENNETT: Yes, your Honour.
GLEESON CJ: And is it convenient for us to work from Reprint No 2?
MR BENNETT: I think everyone has a different one, your Honour.
GLEESON CJ: Yes but we have to write a judgment that has the right one in it.
MR BENNETT: I understand that, your Honour.
GLEESON CJ: If we put the wrong one in it we will have endless correspondence.
MR BENNETT: Yes. The one I have is the same. Yes, your Honour.
GLEESON CJ: Thank you. What is the section?
MR BENNETT: Section 657A(1).
GLEESON CJ: Thank you.
MR BENNETT: Now, your Honours see it commences with the words:
The Panel may declare circumstances . . . to be unacceptable circumstances. Without limiting this, the Panel may declare circumstances to be unacceptable circumstances whether or not the circumstances constitute a contravention of a provision of this Act.
Then subsection (2) provides – and I will contrast this in due course with the former provisions:
The Panel may only declare circumstances to be unacceptable circumstances if it appears to the Panel that the circumstances:
(a)are unacceptable having regard to the effect of the circumstances on:
(i)the control, or potential control, of the company or another company; or
(ii)the acquisition, or proposed acquisition, by a person of a substantial interest –
Now, what is important about that alternative in paragraph (a) is that the word “unacceptable” is not defined. It was defined in the old Act, it is not defined here, although it is circumscribed, as your Honours will see, but not defined. Then “or” – and we stress the word “or” –
(b)are unacceptable because they constitute, or give rise to, a contravention of a provision of this Chapter or –
some other chapters. So they are the two alternatives. Then:
The Panel may only make a declaration under this subsection, or only decline to make a declaration under this subsection –
in other words, what follows is mandatory either way –
if it considers that doing so is not against the public interest after taking into account any policy considerations that the Panel considers relevant.
GLEESON CJ: Why would it be against the public interest to declare that somebody had contravened the Act?
MR BENNETT: Your Honour, suppose there were a contravention involving doing something a day early or not having a notice in the proper form or some other minor contravention of that nature and suppose that the takeover was one involving large numbers of shareholders, most of whom wished to accept the offer which is shown to be to their advantage, the Panel might well take the view it is not in the public interest for us to act on that technical breach and make the declaration.
HAYNE J: The declaration is a declaration of unacceptability, is it not?
MR BENNETT: Yes.
HAYNE J: Not a declaration of contravention.
MR BENNETT: Yes, precisely, your Honour. There may be other examples but that is an obvious one. Then subsection (3) talks about the factors the Panel must consider:
In exercising its powers under this section, the Panel:
(a)must have regard to:
(i)the puroses of this Chapter set out in section 602 –
I will come to that section. That is the Eggleston principles which existed in both the old Act and this Act. It is a section that is not referred to in the majority judgment, not set out anyway in the majority judgment –
(ii)the other provisions of this Chapter; and
(iii)the rules made under section 658C; and
(iv)the matters specified in regulations . . . and
(b)may have regard to any other matters it considers relevant.
So it must consider those matters and may have regard to any other matters. I will show your Honours in a moment how wide those matters are. But the submission I make for present purposes is this, that the reference in paragraph (b) to a contravention, the finding of a contravention is neither necessary nor sufficient. It is not necessary because of (a) which is an alternative route and it is not sufficient because of, first, subsection (1); secondly, the three lines that follow subsection (2)(b) that the Panel may only make a declaration because of its public interest and, thirdly, subsection (3).
GLEESON CJ: Is not section 659B the corollary of section 657A?
MR BENNETT: Not completely, your Honour, partially so because of section 659AA, but it is dealing with another aspect of it, namely, the removal of jurisdiction from the courts.
GLEESON CJ: What I was interested in is what has happened to the court’s jurisdiction to deal with issues about contravention during the period of the takeover bid.
MR BENNETT: Your Honour, we are concerned here with the civil consequences of a contravention. Obviously, if there were a criminal prosecution in relation to a contravention, that is a matter which could proceed and would be unaffected. That follows, apart from anything else, because of section 659B(1) which would certainly include the DPP or ASIC.
GLEESON CJ: Part of the legislative purpose, and as I understand it, part of the acknowledged legislative purpose is to stop people going off to court claiming contraventions during the period of the takeover bid.
MR BENNETT: Your Honour, with respect, that is partially correct. It is correct as a civil matter. It may not be correct as a criminal matter. It may not be correct in relation to proceedings brought by ASIC or a Director of Public Prosecutions or a Minister or any of the other people listed in section 659B(1). So it is a limited desire to ‑ ‑ ‑
GLEESON CJ: It is to stop the target company going up to the Equity Court.
MR BENNETT: Yes.
CRENNAN J: Because under the old system a declaration of unacceptable acquisition of shares, I think was the wording used, meant that there was deemed contravention for the purposes of approaching the Court, as I recollect it, the old CASA legislation, which is quite different.
MR BENNETT: Yes, the very early legislation. But that was not the Precision Data legislation, that was prior to Precision Data.
CRENNAN J: Yes, just talking about the system there where you had a deemed contravention as distinct from this legislation, which is a declaration of a contravention.
MR BENNETT: Yes. Secondly, a contravention only has effect for two purposes.
GUMMOW J: Just before you stray away from 659B, is that expression “court proceedings” defined anywhere at 659B?
MR BENNETT: Yes, in subsection (4) I think it is, your Honour.
HAYNE J: Section 659B(4).
MR BENNETT: Subsection (4), yes. Section 659B(4):
(a)means any proceedings before a court in relation to:
(i)an action taken or to be taken as part of, or for the purposes of, the bid or the target’s response to the bid; or
(ii)a document prepared or to be prepared, or a notice given or to be given, under this Chapter –
and it includes certain things. But one must remember, of course, that a contravention is of relevance only for two reasons. There is what one might call the criminal or public law reason where ASIC or a director wishes to bring proceedings against a person for sanctions in relation to it, that can proceed, and the use made in civil proceedings, and a contravention does not invalidate the takeover. The whole structure of the provisions I have just taken your Honours to is that all a contravention does is, it is one of two alternative ways of enlivening a general policy inquiry into whether it is a good thing that it proceed or not.
GUMMOW J: Just going back to this definition, Mr Solicitor, it is the last sentence that may have a sting in it of the definition:
includes proceedings under other Commonwealth and State or Territory laws (including the general law).
MR BENNETT: Yes.
GUMMOW J: There may be a Georgiadis question there, may there not?
MR BENNETT: Your Honour, I suppose if one were to allege that a party’s statement involved common law deceit, that might be excluded, but the answer to that is that the effect of the party’s statement has been codified and what has been codified is to say if the party’s statement has certain defects, including a defect of that nature, it is a matter for the general discretion, almost completely at large as I have shown, of the experts on the Panel rather than for a court saying, “You have broken the law, therefore this is the consequence”.
The Panel does not say “You have broken the law, therefore this is the consequence”. The reference to a contravention could almost have been omitted. It is, as I say, neither necessary nor sufficient. It is one of two alternative ‑ ‑ ‑
GUMMOW J: But this chapter does not say anywhere, does it, that this exhausts or excludes the common law for the future?
MR BENNETT: Your Honour, it does not in terms, no.
GUMMOW J: No.
HAYNE J: Well, is that right? Do you not need to look closely at the extent of the prohibition provisions? Whether they amount to it, I just do not know, but the scheme of the takeover legislation has always been, has it not, in effect you may conduct a takeover in these and only these circumstances and by these methods and only these methods seeking to state an exhaustive set of provisions regulating them.
GLEESON CJ: Because of the consequences about compulsory acquisition that lie down the end of the road.
MR BENNETT: Yes.
HAYNE J: Yes. Now, I rather suspect the answer may be quite complex and depend upon the closest analysis of the nature and extent of the prohibitions against soliciting sale of securities in particular entities.
MR BENNETT: There are many circumstances in which one might comply totally with the law but have what the Panel regarded as unacceptable circumstances. If your Honours go to the ‑ ‑ ‑
GUMMOW J: But that itself is a law. This notion of unacceptable circumstances is just a law.
MR BENNETT: Yes, but it effectively defines it by reference to the Panel’s view because section 657 ‑ ‑ ‑
GUMMOW J: That is the curiosity of it.
HAYNE J: That is its root vice.
MR BENNETT: I am sorry, your Honour?
HAYNE J: I simply suggested that might be its root vice.
MR BENNETT: Section 657A(2), your Honours will note, begins with the words “if it appears to the Panel” in the preamble. Then one has these very broad references to “public interest” and “policy considerations” and so on. One has the obligation in section 657A(3) to have regard to the purposes of this chapter set out in section 602, and that is the Eggleston principles. Your Honours will see the Eggleston principles in section 602:
to ensure that:
(a)the acquisition . . .
takes place in an efficient, competitive and informed market; and
(b)the holders of the shares or interests, and the directors of the . . .
(i)know the identity of any person who proposes to acquire a substantial interest in the company, body or scheme; and
(ii)have a reasonable time to consider the proposal; and
(iii)are given enough information to enable them to assess the merits of the proposal; and
(c)as far as practicable . . . all have a reasonable and equal opportunity to participate in any benefits –
that is what are colloquially known as the synergies, one of those neologisms that one hears.
It means, in effect, that the premium for control has to be – everyone has to have an equal opportunity to participate in it. One can well imagine the width of considerations that would be applied here and whether something is unacceptable or not. If one considers the standard propositions put by offerors and put by hostile targets, the standard theme one finds the offeror putting is, if you reject this offer your shares are going to drop, that being general sort of market prediction and the standard proposition put by the target directors is, “We are doing a wonderful job, great things are going to happen in the future and if the offer is rejected, shares will do well and this is an opportunistic offer”. Those are the sorts of statements ‑ ‑ ‑
HAYNE J: What you have not mentioned is premium for control and shareholder value, Mr Solicitor, but go on.
MR BENNETT: Yes, well, that is another word for synergies, your Honour, in practice and that is covered by the third of the Eggleston principles. The point for present purposes is, those statements in the commercial world outside the world of takeovers might well be regarded as classic puffs. You should sell me your shares because if you do not they are going to drop or you should not sell your shares because the board is doing a great job and they are likely to improve. The sorts of circumstances where those statements on either side are regarded as unacceptable must be a matter of commercial judgment.
GUMMOW J: I was going to ask you about this, Mr Solicitor. This phrase “unacceptable circumstances” must have some specified content because the Panel has to be amenable to control under section 75(v) of the Constitution. So it is not a Liversidge v Anderson situation. It is not what they say it is. It has to be at the end of the day what this Court says it is so that we can tell whether they go beyond their jurisdiction. So we do need to know just what this expression “unacceptable circumstances” has as its content, otherwise it is not a law.
MR BENNETT: Your Honour, neither the court below nor the amici ‑ ‑ ‑
GUMMOW J: It is not a law because it cannot be controlled under 75(v).
MR BENNETT: Your Honour, neither the court below nor the amici have suggested invalidity on that basis. There are limitations. The limitations are those I have taken your Honour to. My point is that they are very wide limitations but they are limitations and the main ones are in section 657A(3) which sets out matters “the Panel must have regard to” although it “may have regard to any other matters it considers relevant”. Under the old Act, as I will show your Honours in due course ‑ ‑ ‑
GUMMOW J: What I am just saying to you, Mr Solicitor, is to the effect that the ghost of Plaintiff S157 is walking around here.
MR BENNETT: Yes, your Honour.
GUMMOW J: It is not relied upon, I appreciate that. All I am noting is that anything one said would not want to foreclose that sort of problem.
MR BENNETT: No, your Honour. That problem is just not raised in this case.
GUMMOW J: Yes, I understand that.
MR BENNETT: If it had been raised, there might have been an application in relation to the relevant paragraph in S157, but that is a different matter.
GLEESON CJ: Is it, for example, the sort of thing that might be regarded as unacceptable that a consequence of these synergies is that a lot of people will lose their jobs? That is a typical synergy, is it not?
MR BENNETT: Yes. And it would be a matter for the Panel to decide whether or not it regarded that factor as relevant under section 657A(3)(b). As a matter of commercial judgment and as a matter of policy, because it is enjoined to take policy considerations into account, it would have to decide, “We consider that that is a relevant or an irrelevant factor”, and deal with it accordingly. The discretion has that width and that degree of width does not, in my submission, offend the paragraph in S157. The paragraph in S157 was dealing with a submission that it would be a valid Migration Act to say, section 1, no person shall enter Australia; section 2, subsection (1) does not apply if the Minister consents; section 3, the Minister may at his absolute discretion decide whether or not to consent. It was directed to that submission that the Court suggested that might not be a law. That was a dictum; it was not part of the ratio of S157.
GLEESON CJ: That itself is a matter for debate, I think. Is there any obligation in this body to give reasons?
HAYNE J: It is 657A(6), I think, and (6)(b) in particular.
MR BENNETT: Yes, section 657A(6)(b).
KIRBY J: Is there anywhere where you have collected a comparison between the old legislation and the new? I ask that because of the reference to the explanatory memorandum in Mr Hanks’s submissions and the apparent purpose of the change.
MR BENNETT: The difficulty is that there are dozens of provisions, none absolutely identical and a document of that nature would require a – but we can have an attempt at it.
KIRBY J: I do not want to put you to unnecessary work, but is there one which concentrates on the matters which are the subject of this appeal?
MR BENNETT: What we rely on is we say there were four matters the Full Court relied on and we attack each of those as demonstrating relevant differences.
KIRBY J: And you say they are the only ones that are relevant.
MR BENNETT: Yes, your Honour.
KIRBY J: You are still in the structure of your argument on the first, are you?
MR BENNETT: Very much so, your Honour, and on the first quartile of the first.
KIEFEL J: Without giving you further interruption, the first matter, or the matter which seems to be of the most importance in the four factors identified in the Full Court is the contravention question. At some point are you going to come to the types of contraventions that might be the basis of a declaration by the Panel and explain what sort of following orders might be made as a result of those declarations, some practical examples?
MR BENNETT: I had intended to do that, your Honour, for this reason, that our primary proposition is that the requirement of a contravention is neither necessary nor sufficient, so it is ‑ ‑ ‑
KIEFEL J: It is surplusage, is it?
MR BENNETT: In practice it is because it is hard to imagine a case where a contravention was unacceptable within – because a contravention occurred and then 657A(2)(b) applied and it is unacceptable because it gives rise to a contravention. It is not against the public interest, and the Panel takes into account all the factors under 657A(3) ‑ ‑ ‑
KIEFEL J: I see what you are saying there. In a sense the last unnumbered paragraph in subsection (2) would seem to only qualify paragraph (a), sensibly.
MR BENNETT: No, your Honour, we would submit not.
KIEFEL J: You say it works with paragraph (b)?
MR BENNETT: Yes, your Honour. The classic case is the example I gave of the technical contravention in a takeover which is otherwise seen as fair and desirable and in the interests of all parties.
HAYNE J: But (2)(b) can be engaged if, perhaps only if (a) has been discarded from consideration, can it not?
MR BENNETT: That is my point, your Honour.
HAYNE J: Just so, but let us follow it out, Mr Solicitor. What is discarded from consideration, therefore, under (a) is the effect on control or the effect on acquisition of a substantial interest. Is that right?
MR BENNETT: Yes, your Honour.
HAYNE J: What then, having regard to the purposes of the part, as identified in 602, is it that will inform the decision about unacceptability, by hypothesis not concerned with control of the target, not concerned with substantial interest in the target, and yet here we are in Chapter 6 of the Act concerned with takeovers where control and substantial interest lie at the very centre of what the chapter is concerned with. So what is informing the operation of (2)(b)?
MR BENNETT: Your Honour, that is very much the point we make, that the width of (a) is such that it is hard to imagine a case where a Panel is going to make orders because of (b) which satisfies the following words at the end of the subsection, satisfies subsection (3) and yet does not satisfy (a). It is almost unimaginable.
GLEESON CJ: Does that mean that part of the purpose of it is to stop people going off to court and claiming contraventions?
MR BENNETT: Then go to the Panel and claim contraventions.
GLEESON CJ: Yes.
MR BENNETT: All that does is excite almost the same question, not precisely, but almost the same question as if there were no contravention. In other words, as a matter of substance paragraph (b) adds very little to the Act. I put that, of course, as showing that it is not going to have any great effect on whether it is tradition or not. One must remember that there are many situations where tribunals or administrative tribunals or administrators, members of the Executive, need to decide in order to exercise a statutory power whether something has occurred which might amount to a criminal offence. Disciplinary tribunals – and we know from Albarran that they can be administrative tribunals – frequently need to decide whether the person has engaged in conduct which might happen to amount to an offence.
If one looks at the standard sexual allegation before a medical tribunal, it almost always would amount to an offence and medical tribunals frequently deal with such matters in the absence of charge and conviction. They say “What you did to this patient is such as to constitute professional misconduct and as a matter of law it is an assault at the very least and probably a more serious offence”. There is nothing surprising about that. It happens in legal disciplinary tribunals too. Frequently the misconduct is something which might amount to a criminal offence. In the standard case where a solicitor is struck off for stealing from his or her trust account, that is clearly fraudulent misappropriation and the tribunal decides whether it has occurred or not. The licensing authorities do this.
Under the old migration legislation, the very old migration legislation, when being a prohibited immigrant was an offence, detention by the Minister was determined on the basis that the Minister decided you were an unlawful non-citizen, or whatever the phrase was under the old Act, in other words, in those days that you were committing an offence. One can think of numerous other examples. So the mere fact that a tribunal needs to decide something, whether something has occurred which would amount to an offence, does not mean it is acting judicially, obviously it may be a factor of significance, and here, where it is neither necessary nor sufficient and it is so heavily circumscribed by the surrounding provisions, it is a long way from being within the category exclusively reserved to the courts.
Now, your Honours will have noted I mentioned in passing section 657A(3)(a)(iii). That refers to the rules made under section 658C. That section allows the president, after consultation with members of the Panel, to make rules not inconsistent with the Act to clarify or supplement the operation of the provisions of this chapter. In making rules he must consider:
(i) the purposes of this Chapter set out in section 602 –
so he or she has to consider the Eggleston principles and the rule must be published in the Gazette. The Minister may disallow it and again the courts may give directions if a rule is contravened, but under section 657A, the rules made by the Panel itself are matters it must have regard to.
Under the Precision Data legislation, a contravention could have been a matter leading to unacceptability. Under the old legislation the structure there was that the Panel determined if there had been unacceptable conduct. It was 732 of the old Act. Section 732 of the former Act said:
For the purposes of this Part, unacceptable circumstances shall be taken to have occurred if, and only if -
and then there is a repetition of the four Eggleston principles in slightly different words. So under the old Act, which was held to be valid, there was something far more like an application of law to pre‑existing facts. You had a definition of “unacceptable circumstances” and the Panel had to determine whether they had occurred. Under this Act, as I have shown, it is a much wider power involving policy considerations and taking into account all sorts of things. The Panel may well, under section 733 of the old Act:
(3)Where, on an application under subsection (1), the Panel is satisfied:
(a)that unacceptable circumstances have occurred . . .
that it is in the public interest to do so;
the Panel may by writing declare the acquisition to have been an unacceptable –
and so on. But it was a far more precise definition than exists now and, therefore, closer to judicial than the present one.
CRENNAN J: Just looking at those who may apply, Mr Bennett, under 657C(2)(d), I take it that any other person whose interests are affected, if you then go back to 657A(2)(b), such a person could allege in any event contraventions of any of the provisions that are mentioned – chapter 6, 6A, 6B, 6C.
MR BENNETT: Yes. It is the bidder, the target, ASIC, or any other person whose interests are affected.
CRENNAN J: Which gives much wider access, does it not, to the Panel in terms of a contravention than had previously existed?
MR BENNETT: Yes. If I can just show your Honour what their Honours said about that. That appears in paragraph 399(2), at the bottom of page 245, where it says:
The current provisions widen the list of those who can make an application . . . to include not only ASIC but also the bidder, the target –
et cetera. We make these points about that distinction. The first is that a tribunal or administrator may have a very wide list of eligible applicants. For example, any citizen can apply to the ombudsman. I imagine any company can apply to the ombudsman, I have not checked that but I assume so. The Administrative Appeals Tribunal, of course, has for most of its powers very wide lists of eligible applicants. Similarly, a court may have a narrow list of eligible applicants. For example, under section 81A of the Trade Practices Act – your Honours need not go to it – one of the powers of the Federal Court can only be invoked by the Commissioner. Powers of courts may be limited by doctrines of locus standi, as in the Australian Conservation Foundation Case. The mere fact that one has a wide list of eligible applicants does not make it more likely that one is exercising judicial power. Having a wide or narrow list of eligible applicants is consistent with both judicial power and non-judicial power.
KIEFEL J: It tends to render more likely the possibility, however, that there is a controversy, does it not?
MR BENNETT: Yes, your Honour.
KIEFEL J: Because you have people who are claiming an interest and they are claiming an interest where they see some relief might go to address that interest. So that is what you have to analyse.
MR BENNETT: It was argued in this Court in one case some years ago that because the Trade Practices Act authorised any person to bring certain types of application, there was no matter in ‑ ‑ ‑
GUMMOW J: Truth About Motorways.
MR BENNETT: Yes, Truth About Motorways is the case. The argument failed, but it is an indication that at the other end it might be suggested that anyone can apply is closer to administrative than judicial. That seems to have been the basis of the argument in Truth About Motorways, although ‑ ‑ ‑
KIRBY J: I do not know that you are quite right about the Administrative Appeals Tribunal Act because section 27 requires that the person’s interests are affected but there is in subsection (3) a power that organisations which are formed, it is enough that their purposes include the matter concerned so that they can come in that way, but individuals have to have their interests affected. So that is quite a narrow standing right.
MR BENNETT: Yes, but they do under this Act too, your Honour, because under section 657C(2)(d) an application can be made by “any other person whose interests are affected by the relevant circumstances”.
KIEFEL J: That would include affected by a statutory contravention.
MR BENNETT: Yes.
KIEFEL J: I realise I am taking you away from your present topic, but just to return to section 657A(2), when you said that the final paragraph might be addressed to technical breaches, are you reading that paragraph or that sentence to provide a discretion in the Panel in relation to the making of the declaration?
MR BENNETT: It is not strictly a discretion, your Honour, but it is a very widely subjective matter.
KIEFEL J: But it might be a discretion, might it not, “only make” or “only decline”, and if you look at the reasons of the Panel here in relation to the breach of section 606, that appears to be how – it is obviously not conclusive – it has perceived its task?
MR BENNETT: Yes. I am concerned, of course, with the more general question than the specific one.
KIEFEL J: Yes, of course, and you are quite right to do so. If this does involve the notion of a discretion, does that tell us a little more about the power that the Panel is exercising? Is it relevant to the question?
MR BENNETT: Yes, your Honour, it is more likely to be administrative or to be non‑judicial. The point about a technical breach, that was only an example. I gave as an example of a situation where there might be a contravention but it would be contrary to public interest to make a declaration and therefore the Panel might refrain from doing so and I gave as the extreme example the technical breach in a desirable and important takeover that everyone wants. One could think of other examples.
There may well be cases where there has been a breach which is a little more than merely technical but where the court takes the view that in all the circumstances a declaration should not be made because of countervailing benefits, perhaps because, for example, it was a particularly beneficial, particularly generous, takeover offer by someone who might not be in a position to make it if time went by. One can well imagine all sorts of circumstances where the public interest might override the fact that there had been a contravention. In my respectful submission, it is simply part of the surrounding circumstances which make it clear that the contravention is not the centrepiece of this statutory provision. If that is a convenient time to adjourn.
GLEESON CJ: We will adjourn until 10.15 tomorrow.
AT 4.15 PM THE MATTER WAS ADJOURNED
UNTIL WEDNESDAY, 3 OCTOBER 2007
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