Bass & Anor v Permanent Trustee

[1998] HCATrans 307

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S45 of 1997

B e t w e e n -

MICHAEL REGINALD BASS and EVELYN MAUDE BASS

Appellants

and

PERMANENT TRUSTEE COMPANY LIMITED

First Respondent

FANMAC LIMITED

Second Respondent

STATE OF NEW SOUTH WALES

Third Respondent

PERMANENT CUSTODIANS LIMITED

Fourth Respondent

LIVERPOOL-INGLEBURN CO‑OPERATIVE HOUSING SOCIETY

Fifth Respondent

MARKHAM, GEIKIE & RUMORE

Sixth Respondent

CO-OPERATIVE HOUSING SOCIETIES ASSOCIATION OF NEW SOUTH WALES LIMITED

Seventh Respondent

THE ESTATE OF ANTHONY MARKHAM

Eighth Respondent

Office of the Registry
  Sydney  No S46 of 1997

B e t w e e n -

PAULA CONCA and MARCELO ALBERTO CONCA

Appellants

and

PERMANENT TRUSTEE COMPANY LIMITED

First Respondent

FANMAC LIMITED

Second Respondent

STATE OF NEW SOUTH WALES

Third Respondent

PERMANENT CUSTODIANS LIMITED

Fourth Respondent

MERRYLANDS CO-OPERATIVE HOUSING SOCIETY

Fifth Respondent

LIVERPOOL-INGLEBURN CO‑OPERATIVE HOUSING SOCIETY

Sixth Respondent

CO-OPERATIVE HOUSING SOCIETIES ASSOCIATION OF NEW SOUTH WALES LIMITED

Seventh Respondent

KEN LONG (trading as LONG & COMPANY)

Eighth Respondent

Office of the Registry
  Sydney  No S47 of 1997

B e t w e e n -

BESSIE MAVIS WOODLANDS (on her own behalf) and BESSIE MAVIS WOODLANDS (as Administratrix ad litem of the ESTATE OF LILLIAN MAY BALLARD)

Appellants

and

PERMANENT TRUSTEE COMPANY LIMITED

First Respondent

FANMAC LIMITED

Second Respondent

STATE OF NEW SOUTH WALES

Third Respondent

PERMANENT CUSTODIANS LIMITED

Fourth Respondent

FAIRDALE CO‑OPERATIVE HOUSING SOCIETY

Fifth Respondent

CO-OPERATIVE HOUSING SOCIETIES ASSOCIATION OF NEW SOUTH WALES LIMITED

Sixth Respondent

GLEESON CJ
GAUDRON J
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 2 SEPTEMBER 1998, AT 10.24 AM

Copyright in the High Court of Australia

__________________________________

MR J. BASTEN, QC:   If the Court pleases, I appear for the appellants in each of these matters with MS S. WINTERS and DR S.C. CHURCHES.  (instructed by the Public Interest Advocacy Centre)

MR B.A.J. COLES, QC:   If your Honours please, I appear with my learned friend, DR C.J. BIRCH, for the first and fourth respondents in the proceedings where Bass is the appellant and for those same parties in the other proceedings.  (instructed by Church & Grace)

MR T.F. BATHURST, QC:   If the Court pleases, I appear with my learned friend, MR I.M. JACKMAN for the second respondent in each of the proceedings.  (instructed by Mallesons Stephen Jaques)

MR L.S. KATZ, SC, Solicitor-General for the State of New South Wales:   If the Court pleases, I appear for the third respondent in each matter, together with my learned friends, MR A.J.L. BANNON, SC, and MR R.P.L. LANCASTER. (instructed by the Crown Solicitor for New South Wales)

MR G.M. McGRATH:   If the Court pleases, I appear in the matter where Bass is the appellant, S45 of 1997, for the Co-operative Housing Society, the fifth respondent and the Co-operative Housing Societies Association, the seventh respondent.  In No S46 of 1997, where Conca is the appellant, I appear for the Co-operative Housing Societies which are the fifth respondent and sixth respondent and also for the Association which is the seventh respondent.  In the third matter, where Woodlands is the appellant, No S47 of 1997, I appear for the Co-operative Housing Society which is the fifth respondent and the Association which is the sixth respondent.  (instructed by Church & Grace)

MR D.M.J. BENNETT, QC, Solicitor-General for the Commonwealth: If the Court pleases, I appear with my learned friends, MR H.C. BURMESTER, QC and MS R. SOFRONIOU, for the Attorney‑General for the Commonwealth intervening in each of the three matters.  (instructed by the Australian Government Solicitor)

MR R.J. MEADOWS, QC, Solicitor-General for the State of Western Australia:  May it please the Court, I appear with my learned friend, MS J.C. PRITCHARD, on behalf of the Attorney-General for the State of Western Australia intervening in support of the third respondent.  (instructed by Crown Solicitor for the State of Western Australia)

MR B.M. SELWAY, QC, Solicitor-General for South Australia:   May it please the Court, I appear with my learned friend, MS I.K. HAYTHORPE, for the Attorney‑General for South Australia intervening in support of the third respondent.  (instructed by the Crown Solicitor for South Australia)

MR A.J. MYERS, QC:   May it please the Court, I appear with MR M.R. PEARCE for the Australian Competition and Consumer Commission. (instructed by Dunhill Madden Butler) 

We seek leave to intervene on behalf of the Commission for the purposes of making limited submissions upon the proper scope or breadth of what is described as the second limb of Bradken, the derivative immunity.  If the Court pleases.

GLEESON CJ:   Is that application opposed?

MR KATZ:   Your Honours may have a copy of a document headed “Supplementary Submission on Behalf of the Australian Competition and Consumer Commission”; the one which I have appears to be undated.  Paragraph 2 of that, under the heading of “Leave to Intervene” sets out the position which my learned friend has just identified as relating to what is called in the case “the second limb of Bradken”.  Could I direct your Honours’ attention to pages 454 through to 457 in the appeal book, in which appear orders made by his Honour Justice Gummow on 12 June and your Honours will be aware from page 455 that his Honour there directed:

that the parties be prepared to argue in advance of any issues which then might remain upon the appeal -

certain identified issues, all of those issues relating to a question other than the second limb of Bradken, if I may put it in that way, and then his Honour made further orders which appear on page 456 and, in particular, may I draw attention to the third order which provided that the appeal book might:

also contain a statement of what the parties agree are facts representing the substance of the material contained in the Agreed Bundle of Documents which Bundle is referred to in Order 1 of the Orders made by the Full Court -

During the course of the hearing which preceded the making of those orders, his Honour Justice Gummow said this, and we respectfully adopt it:

It may also appear to the Full Court - and nothing I am saying is tending to bind the Full Court, obviously I could not do so if I wanted to - that really what I have set out in the draft order 1 are really the grounds that should be decided anyway and that it would be then for the Full Court to decide what should happen next with the litigation, whether further grounds of appeal which could involve looking at this statement of agreed facts as an essential factor, namely, for example, questions of estoppel and the so‑called second

limb of Bradken - the Full Court might decide to embark on that or it might decide not to.

His Honour’s approach was that the agreement on facts which is referred to in order 3 was a sine qua non to this Court’s considering whether or not it would advance to the second limb of Bradken.

Your Honours, there has been no agreement as to facts of the sort which was contemplated in order 3 and in those circumstances, in our submission, this Court in any event would not proceed to consider what is called the second limb of Bradken in the course of the two days presently aside for this hearing.  In those circumstances and given the limited character of the submissions which the ACCC says that it intends to make, its intervention can serve no useful purpose, in our respectful submission, and it is for that reason that we oppose it.  If the Court pleases.

GLEESON CJ:   Mr Myers?

MR MYERS:   Your Honours, the submissions that have been made should not stand in the way of leave to intervene being granted to the ACCC.  The question that is to be argued on behalf of the ACCC is not one that depends upon an agreed statement of facts, whether it be that referred to in paragraph 3 of Justice Gummow’s order, or not.  It is simply a question of statutory construction upon the facts that are assumed in virtue of the pleadings before the Court.  It is alleged that certain misleading statements were made by persons whom it is alleged were agents of the Crown in right of the State of New South Wales, and the question that as to be decided is one of statutory interpretation can be decided on those facts.  The Court, in my respectful submission, should take the opportunity when everyone is here to deal with the Bradken doctrine in its entirety and not split the matter as has been suggested.

GLEESON CJ:   Mr Myers, you may have leave to intervene but without prejudice to the question of what decision the Court might make in relation to the matter that was raised by Justice Gummow and referred to by the Solicitor for New South Wales.

MR MYERS:   May it please the Court.

GLEESON CJ:   Yes Mr Myers.  Mr Basten.

MR BASTEN:    Your Honours, there is one preliminary matter which I should deal with at the outset ‑ ‑ ‑

GLEESON CJ:   Before you begin, Mr Basten, may I mention that we have a certificate from the Senior Registrar that she holds a letter from Colin Biggers and Paisley advising that the sixth and eighth respondents in S45 of 1997, and the eighth respondent in S46 of 1997 do not intend to take any part in the hearing of these appeals, and agree to be bound by any decision or order of the Court, save as to the question of costs.  Yes, Mr Basten.

MR BASTEN:   Your Honour, the ‑ ‑ ‑

KIRBY J:   Could you direct to the microphone a little because I am not getting - I think you have to lift the podium in some way.  I can get your voice but ‑ ‑ ‑

MR BASTEN:   Perhaps I can speak up a little, your Honour, I am not sure how to do the mechanical bit.

KIRBY J:   I would hate to miss any of it.

MR BASTEN:   In matter No. S47 of 1997, there are two appellants, Bessie Mavis Woodlands and Lilian May Ballard.  Mrs Ballard died on 23 July of this year.  There is a motion seeking to have her daughter, the first appellant, substituted as an administratrix ad litem for the purpose of these proceedings.

GLEESON CJ:   Is that opposed?  Very well you have that order.

MR BASTEN:   If your Honour pleases.  The HomeFund Scheme, your Honours, which underlie these proceedings, had two principal parts.  First, its ultimate purpose was to provide home loans to low income earners who might not qualify under normal guidelines employed by private lending institutions.  The second part of the scheme involved raising of the necessary funds, for which purpose the State entered into agreements with various corporations which would allow large sums to be raised by creating a secondary market via securitisation of the mortgages which were to be made.  These proceedings do not challenge any aspect of those agreements with the non-State respondents.

The claims made under the Trade Practices Act in the proceedings go to the manner of selling the mortgages and the terms of the mortgages between the first respondent and the borrowers.  The claims thus arise under the consumer protection provisions of Part V of the Trade Practices Act.  They do not involve, of course, the restrictive trade practice provisions under Part IV which were the basis of consideration by this Court in Bradken.

This case raises the question whether the conduct of the Crown and its agents, including the non-State corporate respondents ‑ ‑ ‑

GAUDRON J:   Well, you accept that they are their agents, do you?

MR BASTEN:   We accept for the purposes of these proceedings that they - I use “the agents” your Honour, in a non-technical sense which is set out in a little more detail, both in the judgment of the Full Federal Court and in the summary of facts.  We accept that they were undertaking activities pursuant to deeds which were entered into between them and the State.

GAUDRON J:   Does that make them anything more than co-venturers?

MR BASTEN:   We would say not, your Honour.  We would say that they were involved in the conduct with the State.  They were not, as it were, carrying out delegated functions of the executive government of the State or anything like that.  They were certainly not statutory corporations of the State, nor were they, in our submission, in any sense officers or employees of the State.

GAUDRON J:   Is your claim against the co-venturers separate and distinct from that against that of the State or are they inseparably linked together so that there is one inseverable controversy?

MR BASTEN:   It depends upon the interpretation, in one sense, of the provisions of the Trade Practices Act, your Honour.  We would say that there is one inseverable controversy but we accept that there are two ways in which ‑ ‑ ‑

GAUDRON J:   Well, do you concede that for the purposes of this proceeding or not, because otherwise there is a question of whether the proceedings against the State are proceedings in federal jurisdiction.

MR BASTEN:   Well, your Honour, we would ‑ ‑ ‑

GAUDRON J:   And that raises the question of whether section 64 applies.

MR BASTEN:   Yes.  Well, your Honour, might I ‑ ‑ ‑

GAUDRON J:   I take it you ask us to assume that there is one inseverable dispute?

MR BASTEN:   We would certainly say it is inseverable in that sense, your Honour, and there may be a question about whether, if a different view is taken about it, there remains jurisdiction in the Federal Court under the associated jurisdiction of that court.  That was a separate way of perhaps looking at the matter but I was not intending to address that as part of - it is certainly not our primary case and I was not seeking to put it on that basis.

GLEESON CJ:   Does what you have just said cover the position of those respondents who owe their presence in these proceedings to the fact that they acted as solicitors for the borrowers?

MR BASTEN:   That would certainly be the case, your Honour.  They are not here, and their role is not in issue, as I understand it, pursuant to the questions which were decided in the Federal Court.

GLEESON CJ:   So we can ignore them for purposes of the questions we are addressing?

MR BASTEN:   We can, your Honour.  But, the question may still arise whether, in relation to any misleading conduct on their part, claims can be made against them under the Trade Practices Act, and if the claims are available under the Trade Practices Act then we would say there is an exercise of federal jurisdiction in the Federal Court.  If I have answered your Honour Justice Gaudron’s question ‑ ‑ ‑ 

GAUDRON J:   Yes, if we are to assume an inseverable dispute, then we are to assume that when you use the term “agents” you mean nothing more than co‑venturers.

MR BASTEN:   That is so on both counts, and I am indebted to your Honour for putting it in that way.  What I was going to proceed to was this proposition:  the circumstances in which the Trade Practices Act provisions and the provisions themselves are engaged in the pleadings differs from those in Bradken.  On the other hand, the judgments in that case are expressed in terms which apply to the Trade Practices Act as a whole and, accordingly, it is assumed for present purposes, although we do not concede the point, that we may need to reopen the decision in Bradken in order to pursue the arguments which we seek to pursue in challenging the judgment below.  In the directions which his Honour Justice Gummow gave to which your Honours have been taken, that was a point which was identified as the first of the two points to be argued in advance of any others on this appeal.

In the submissions which we have provided to the Court we raise a number of bases upon which we say it is appropriate for this Court to reconsider the breadth of the conclusions reached by the Court in Bradken, and those matters are set out at page 6 of the written submissions and I will not seek to repeat them here.  We say there are a number of aspects of the matter which would make it appropriate for this Court to consider the breadth of that judgment.  As I read the submissions of those who oppose us, the issue ultimately comes down to one of principle, namely this:  we say that there are, in effect, two lines of authority which have developed in this Court concerning the application of federal statutes to the Crown in right of other States and consequentially to certain other parties.

We say that the principles which are involved in the line of which Bradken is a part are based upon the presumption most recently considered by this Court in Bropho, and take no account of the various Crown Proceedings Acts and the Judiciary Act of the Commonwealth, which may itself have bearing upon the question of whether or not a Commonwealth statute binds the Crown.

KIRBY J:   Can I just ask you - it may seem a curious question, but what is the case early in the days of Federation that said that the State was a manifestation of the Crown, the State created by the Constitution of the Commonwealth of Australia? I am thinking of the decision in Byrne v Ireland which said that upon the creation of Ireland it was not to be regarded as a manifestation of the Crown now.  Of course, we are a monarchy but, on one view, the Constitution of the Commonwealth created the Commonwealth and the State, which are different from the Crown.  Now, why did we slip into the assumption that they are, as it were for this purpose, manifestations of the Crown?

GUMMOW J:   Particularly where, if I may add, you have to be in federal jurisdiction, which does not know of such a thing; it just knows of States and the Commonwealth.

MR BASTEN:   Yes.

KIRBY J:   Byrne is in (1972) IR, and the passage of Justice Walsh’s decision is at page 274.  It is one of the most important that distinguished judge wrote.

MR BASTEN:   Yes.

KIRBY J:   He said it was simply inappropriate to pick up and apply to Ireland the notions which had been developed in England for the State as the sovereign.  Now why did we, in Australia, take a different course, and is it still relevant, given that the source of all authority in Australia is said to be the people of Australia, not the sovereign?

MR BASTEN: Yes, well, I am not sure if I am aware of the earlier authority which your Honour is requesting; I do not know the answer to that part of your Honour’s question. We would say that the correct analysis is that the juristic entities, namely the Commonwealth and the States, created under the Constitution, are the relevant bodies for consideration in relation to whatever aspects of prerogative rights, questions of statutory interpretation or otherwise, need not to be considered and we do not submit, of course, that there is any necessary correlation between the way that one approaches those entities and the way that one, under English law, considered the role of the Crown, and I think there are comments to a similar effect in the joint judgment of your Honour Justice Gummow and Justice Kirby in Mewett, which at least goes some of the way to developing that distinction.

What we say in the present case is that in interpreting the Trade Practices Act one does so, I suppose, against a circumstance where the States and the Commonwealth are the identified parties in the Judiciary Act but, where in terms of statutory provisions, one traditionally finds reference to whether or not an Act binds the Crown in right of the State or in any other capacity or in all capacities. Our respectful submission would be that those statutes do no more than pick up in terminology, which is reminiscent of the English case law, those concepts of the State and the Commonwealth as they exist under the Constitution, and that that is how one should read the concepts in Australian statutes and it may well be as a result that one gains little benefit from reference to rules relating to the application of statutes to the Crown, except perhaps in that context where it may be thought that the Crown may be affected in her personal capacity and, being still a monarchy, that may still have some minuscule operation in this country.

KIRBY J: Section 78 of the Constitution might have some relevance because it seems to imply that there was a continuing barrier, but anyway, I may return to this, but I just am curious why we have persisted in talking of “the Crown in right of the State, the Crown in right of the Commonwealth”. I have done it myself but why do we do it, given that the Constitution of Australia creates a Commonwealth and States?

McHUGH J: Well, one answer may be that section 61 of the Constitution vests the executive power of the Commonwealth in the Queen. So that everything that is done in terms of executive power by the Commonwealth is done in the name of the Queen. Section 117 of the Constitution talks about “A subject of the Queen, resident in any State” and the preamble talks about the people agreeing “to unite in one indissoluble Federal Commonwealth under the Crown of the United Kingdom”, so, given the era, it is not difficult to understand why the terminology was used, particularly having regard to the debates that accompanied what became section 78 of the Constitution, that it was just accepted that the Commonwealth and the States would be emanation of the Crown.

MR BASTEN:   I would accept that, with respect, in relation to the terminological issue.  There may be - and, as I understood it there, perhaps there is a second part to the question, namely, whether as a matter of principle one should now in Australia adopt similar approaches to these questions of whether the Crown is bound, as are adopted by ‑ ‑ ‑

GUMMOW J:   Section 119 talks about “the Executive Government of the State”.

MR BASTEN:   Yes.

GUMMOW J:   Section 84 talks about “the Executive Government of the Commonwealth”.

MR BASTEN:   Yes.

KIRBY J:   Behind my question was the fact, as Justice Walsh explains, that the notion of the immunity came historically from the immunity of the sovereign as a person.  The question is in this day and age, given the creation of the Commonwealth and the States, it is appropriate to invest those governmental bodies or continue to invest them with an immunity which attached to the sovereign personally but which may not be apt to a governmental organ such as the Commonwealth or the State in this day and age, whatever may historically have been the case.

McHUGH J:   Well, the United States developed the same doctrine, notwithstanding the republic.  In fact, until comparatively recently it was defended in a more extreme form than we have ever defended the immunity of the Crown.

MR BASTEN:   Yes.

KIRBY J:   Justice Walsh points out that France threw it off in the 1870s, so it is a question that has puzzled me for a time and that is why I raised it.  It is of course relevant to this case in the sense that the immunity, if it exists, is an immunity that is historically inherited from the immunity of the sovereign personally and not something that of its nature attaches to a governmental entity such as the Commonwealth or the State.

MR BASTEN: Yes, well, it may be the last part of your Honour’s comment which becomes critical. I was going to make two responses taking up what your Honour is putting. Firstly, in relation to section 78 of the Constitution which, as we would understand it, is the basis for section 64 of the Judiciary Act.  The laws which the Parliament may make relate to rights to proceed against the “Commonwealth or a State”.  In other words, those are the juristic entities which are picked up as the subject matter of that provision, and if one needs to, and I think the learned Solicitor for South Australia does so in his written submissions, one goes back to the convention debates and one sees that there is an intention in such an enactment to remove any question of what one might call executive immunity, and I think the term “sovereign immunity”, which is derived from the American cases, is expressly used by one of the speakers during those debates.

The other aspect of what your Honour is putting is that there are, no doubt, matters of principle which govern how the executive government should be subjected to particular laws simply because there are, no doubt, public interests which make the executive government, in whatever form, a different entity from an individual.  And, of course, one can look through both administrative law and tort law to find examples of situations where the executive government is not placed in identical position with an individual.  Mengel’s Case may provide one example of that, and the policy operational distinction to the extent that it remains in tort law may be another example. I suppose that in answer to your Honour’s question we would say that one needs to look at the important policy issues which may underlie how one treats the executive government,. One does not, under the Constitution, necessarily need to return to the English ideas in relation to the development of Crown immunity, although those ideas did inform and form the basis of the provision such as section 78 when they were debated in 1901.

McHUGH J:   Can I just understand what you are saying:  are you going to submit that there is no such thing any longer as Crown immunity at common law in this country?

KIRBY J:   Or State immunity?

MR BASTEN:   In a sense, your Honour, yes, because one needs to restrict the scope, perhaps, of the answer in relation to federal jurisdiction in which section 64 operates.  We say that has that effect.  In relation to section 5(2) of the Crown Proceedings Act in ‑ ‑ ‑ 

McHUGH J:   That is qualified.  Section 64 is qualified.

MR BASTEN:   Yes, that is so.  There may be a separate question of statutory interpretation which needs to be considered.

McHUGH J:   No, what I want to understand is, independently of statutes, such suits against the Government Act, Crown Proceedings Act, and so on and similar statutes, is it your submission that at this point of time there is no common law immunity of a Commonwealth or State Government, or if you like, Commonwealth or State Crown?

GAUDRON J:   You have to ask, immunity from what, do you not, in a sense?

MR BASTEN:   With respect, I think that may be right.

GUMMOW J:   And in so far as you are dealing with the Commonwealth, you have to take on board what was said by the majority of the Court in Mewett.

MR BASTEN: That is right, and there may well be those categories of cases where the immunity is constitutionally guaranteed and therefore one can say does not exist relevantly for the purposes of our law. Whether this case falls into such a category is something we say does not need to be addressed on the circumstances of the case, so long as the authority of section 78 is sufficient to extend to the question of the immunity of the State in federal jurisdiction. The challenge which is made, as I would apprehend it, is that if we get up on our argument that section 64 has application, and has the application we ask, then the point as put by the Solicitor for the State that section 64 is to that extent invalid because ‑ ‑ ‑

GAUDRON J:   Well, he goes further than that, does he not?  He says it is wholly invalid in its application to the States.

MR BASTEN:   Yes, I think that - well, I am not sure whether he was intending to take on the views expressed by the majority in Mewett which partly - well, that might not necessarily be the case if section 64 is of course not the source of those immunities but in so ‑ ‑ ‑

GUMMOW J:   They are not the views stated, they are vital to the decision of the majority.

MR BASTEN:   Yes, section 64 may in part reflect them and to that extent be unchallengeable, one would have thought, but it may be that he goes so far.  We would say that is not a position which can be taken in this Court.

GAUDRON J:   Well, the first question you say, though, is whether or not the Trade Practices Act binds the State of New South Wales but I wonder why you ask that question at all.  Why do you not just ask whether the provisions which are expressed to operate with respect to corporations, which is a defined term in the Act, and which you say have been breached, apply as a matter of ordinary construction to the State?

GUMMOW J:   That is the way it was put - that the question is framed at 455.  The question is, are -

the prohibitions imposed by either or both s.51AB -

imposed upon the State on the construction of the Act.

MR BASTEN:   Yes.  Well, your Honour, we accept that ‑ ‑ ‑

GUMMOW J:   On the text of the Act the answer seems to be “no”.

GAUDRON J:   You see, you are not dealing with what we might call a State corporation, such as the Treasury Corporation formed within the Commonwealth.

MR BASTEN:   No.

GAUDRON J:   You are dealing with the State itself, apparently.

MR BASTEN:   Well, with respect, we would accept what your Honour is putting and I do not know whether it was of any significance to the Court in phrasing the questions but we had identified certain issues in similar, though not identical terms, to those identified at 455, so, we respectfully accept that is the correct approach.

GLEESON CJ:   The State exercising what looks like the governmental function of providing housing loans to people who could not obtain them in ordinary trade or commerce?

MR BASTEN:   Well, I take the way your Honour puts that.  The question then becomes if the State enters into that area of supplementing, as it were, the ordinary operation of trade or commerce, whether in so far as the Trade Practices Act would bind it and its officers and so on, whether it does in fact do so.  I suppose the question in response to Justice Gaudron’s question as to how these matters came before the Court in part depends upon the way in which it was approached this Court in Bradken because the commissioner was a corporation sole in Bradken and this Court dealt with the matter by asking was the commissioner the Crown and that was conceded.  The answer was “Yes”.  The question was then whether, as a matter of statutory construction, the Trade Practices Act bound the Crown.

GAUDRON J:   That seems to be an entirely different question from the question that arises in this case, namely, whether the prohibitions which are addressed to corporations apply to the State itself.

MR BASTEN:   Yes.  Well, that is ‑ ‑ ‑

GAUDRON J:   That is to say, is the State a corporation, in effect, for the purposes of the Constitution?  One would have thought answer:  clearly, no.

MR BASTEN:   No, we do not differ from that, your Honour.  We do not say that it is a corporation.  We accept that in so far as the conduct of its officers and agents may be caught, it would have to be conduct which falls within the extended definitions in section 6, use of the electronic media and postal services for advertising, the availability of mortgages or, alternatively, that the conduct of its officers and agents may be caught under 75B.  That is our first proposition.  We do not say that the State is a corporation but the second limb of our argument ‑ ‑ ‑

GAUDRON J:   Do you allege breaches by the State of the Trade Practices Act?

MR BASTEN:   Yes, your Honour.

GAUDRON J:   Of 52?

MR BASTEN:   Yes.

GAUDRON J:   What was 52A and is now 51AB?

MR BASTEN:   Yes.

GAUDRON J:   Section 71?

MR BASTEN:   Yes.

GAUDRON J:   Section 74?

MR BASTEN:   Not 71, I think, your Honour.  I will have to check the pleadings.

GAUDRON J:   Section 74?

MR BASTEN:   Yes, 74(1) and (2).

GAUDRON J:   Any others?

MR BASTEN:   No.

GAUDRON J:   Right.

MR BASTEN:   Those are the substantive ‑ ‑ ‑

GUMMOW J:   How, as a matter of text, do you say the - just as a matter of text to the Act, do you say the State is subjected to these prohibitions, or in the case of 74, to the warranty?

MR BASTEN:   Well, in so far as the State acts through ‑ ‑ ‑

GUMMOW J:   No, we have to look at the text, we have to find some words that you say convey a meaning which includes the State, and it is a matter of identification.  It was definite in Bradken because the commission was a corporation.

MR BASTEN:   I accept that, yes.

GUMMOW J:   You have not got that here.

MR BASTEN:   No, we do not have that.  Well, the question is, in a sense, not whether the State has acted directly on its own behalf for that purpose but whether its officers and agents which have so acted, may have acted in contravention of 6(3)  ‑ ‑ ‑

GAUDRON J:   Are they separate from these corporations?

MR BASTEN:   Yes, they have nothing to do - in so far as the State ‑ ‑ ‑

HAYNE J:   But what is the question?  Are you suing the State for breach of, for example, 52A, or are you not?  Are you suing individuals for breach of 52A, or are you not?

MR BASTEN:   We sue the State under the Crown Proceedings Act.The conduct of the State is relevantly going to be the conduct of individuals.  We are entitled to sue the State though as the entity which is liable for that conduct.

GAUDRON J:   That is a different question, is it not, from the Trade Practices Act?

MR BASTEN:   But if your Honour asks what is the conduct which we allege, the conduct is the conduct which involves the conveyance of misleading material through the post, and so on.

HAYNE J:   Do you allege that the State has contravened 52A?

MR BASTEN:   Through its officers and agents, yes.

GLEESON CJ:   Well, now, we have individuals and we have the State.  Where do we get to a corporation?

MR BASTEN:   We do not get to a corporation in relation to any conduct specifically of the State.

GUMMOW J:   Mr Myers says you only get there by treating the State as a person.

MR BASTEN:   Yes, we do and we say that ‑ ‑ ‑ 

GUMMOW J:   And therefore through the Acts Interpretation Act is a body politic.

MR BASTEN:   Yes, that is so.

GUMMOW J:   And you get to persons through the expanded meaning of some of these sections or varying meaning given by section 6.

MR BASTEN:   Yes, that is so.  We do not say the State itself is a corporation.  It may be then that the operation of the Act in relation to the State itself is limited, but the question ‑ ‑ ‑ 

GAUDRON J:   The thing is are you saying, and is it pleaded, that individuals acting as servants of servants or agents of the State of New South Wales sent false and misleading information through the post?

MR BASTEN:   Yes.

GAUDRON J:   Well, is that pleaded?

MR BASTEN:   Yes, on page 9 of the appeal books, paragraph 14, the particulars alleged that:

The Third Respondent advertised on the electronic media and in daily newspapers, and widely distributed literature.....target mailing -

and so on.

GAUDRON J:   Now is that the only relevant breach that is alleged against the State?

MR BASTEN:   I am not sure that it is the only relevant breach, your Honour, but I ‑ ‑ ‑ 

GAUDRON J:   Well, I think you should be in a position to answer that.  I mean one has got to deal with this matter in some sort of textural frame.

MR BASTEN:   Yes, I accept that, and it may be that for present purposes I should accept that that is the only breach.  I thought there was another paragraph.  Yes, there is a consequential paragraph, paragraph 15, which picks up the nature of the “material distributed” but the breach of conduct complained of remains the same.  It relates to the promotional material.

GUMMOW J:   And the relief that you sought in the amended application?

MR BASTEN:   Yes, the relief seeks for example, at page 2, declarations in relation to contraventions, for example of sections 52 and so on, by the third respondent, which is the State.

GAUDRON J:   Which contraventions are sending false and misleading materials through the post or by means of telegraphic or telephonic services or a radio or television broadcast.

MR BASTEN:   Yes.  I accept that the State, not being a corporation, it is not going to be directly bound by the substantive provisions of the Trade Practises Act, except in so far as incidental extensions by section 6(3) and 75B will have that effect.  Now, the substance of the ‑ ‑ ‑ 

GAUDRON J:   Let us find out what effect section 75B has, what extended effect.

MR BASTEN:   Well, section 75B, your Honour, deals with persons who are involved in contraventions by others.

GAUDRON J:   Was that in force at that time, 75B, at the relevant time?

MR BASTEN:   1977, your Honour?

GAUDRON J:   Yes, and apparently ‑ ‑ ‑

MR BASTEN:   It was changed.  It has been amended but I do not ‑ ‑ ‑

GUMMOW J:   But 75B talks about “persons”, so we are back to Mr Myers’ point.

MR BASTEN:   Well, we are back to the question of the officers and employees of the Crown.  I mean, there are in substance two ways of looking at this, as I understand the case put against us.  One is that the State itself if immune, the officers and agents of the State will enjoy that immunity - I know that does not necessarily follow but that is as we understand the case put against us - and the non‑State respondents who join with the State in carrying out the venture will similarly enjoy the immunity.

HAYNE J:   Well, immunity may have a certain mesmeric effect in this case.  At least for my own part, I will need to understand how it is that you say the Act applies as a matter of text.  Then maybe one comes next to the question of what on its true construction that Act means, and in particular is the Act intended to bind another polity in the Federation?  But at least for the moment, talk of immunity may perhaps be distracting.

MR BASTEN:   Yes.  I suppose I have put it in that way, your Honour, for this ‑ ‑ ‑

GUMMOW J:   And premature.

MR BASTEN:   Yes, we would accept that for present purposes, but the role of the State directly under the Trade Practices Act is, we concede, a very limited one.  The parts we have pleaded against the States specifically are limited to particular aspects of conduct.  There is a question as to whether the Act applies to those officers in relation to that conduct, and for that purpose I suppose the textual question is whether, the Acts Interpretation Act notwithstanding, “person” in the Trade Practices Act is not intended to include persons who are officers or agents in the employ of the Crown in right of the State.

GAUDRON J:   You have not sued those persons, have you?

MR BASTEN:   We do not need to, your Honour.

GAUDRON J:   Well, I am not too sure that that is right.  I can understand your case against the State if it is said that the State by its servants and agents - that does not matter - sent material through the post.  We will use that as a shorthand.  I can understand that if you say that the State through its servants and agents - and again that does not matter - aided and abetted the non‑State respondents, but does your case go beyond that?

MR BASTEN:   In relation to the conduct of the State, itself, no, your Honour.

GAUDRON J:   So the persons are irrelevant except on the basis that the State is a person who aided and abetted the building societies, we will say.

MR BASTEN:   Yes.  For textual purposes, that is so.  The question then becomes, perhaps in relation to the directions that were given, whether it is appropriate to develop the argument which I was foreshadowing in relation to the application of the Judiciary Act as a basis for adopting a different approach which no doubt depends upon the answers to the textual questions which have been raised by members of the Court, as a basis for saying this is not only a very different case from Bradken but one which needs to be considered in a manner which does not simply involve the application of the principle set out in the judgment in Bradken.  That is the point to which I was seeking to come because, as we understand the approach which was adopted both in the court below and in the directions, it was necessary for us to have the Court reconsider whether the ruling in Bradken that the Trade Practices Act did not bind the State was correct in all the circumstances, and in particular in the circumstances of this case.

GLEESON CJ:   The Commonwealth Parliament seems to have legislated on the face of the ruling in Bradken in section 2B of the Trade Practices Act.  If your argument about section 64 is correct, how does it apply to the Trade Practices Act in its present form, including section 2B?

MR BASTEN:   Your Honour, there were two issues, as we would understand it.  In 1975 when the Trade Practices Act was enacted, it said nothing about the liability or otherwise of the States or the Commonwealth.  Section 2A was then inserted which dealt with aspects of the Commonwealth and took the matter one stage beyond that that we say applies in relation to the State because it substantially deemed the Commonwealth to be a corporation for the purposes of the Act when it was carrying on a business.  Section 2B was introduced in order to provide that two particular parts of the Act ‑ ‑ ‑ 

GUMMOW J:   Section 2A predated Bradken.

MR BASTEN:   It predated it, your Honour, yes.  It predated it, although it was - all I was saying was that it was introduced after the original Trade Practices Act which was silent on that question.

GUMMOW J:   Yes, and it followed a recommendation of the Swanson Committee, did it not, to which we can now freely look.

MR BASTEN:   Yes.

GUMMOW J:   We might not have been able to at the time of Bradken, but we can now because of 15AA of the Interpretation Act.

MR BASTEN:   You can, indeed, and one of the things we find in that is a doubt that the Commonwealth had power to legislate in respect of the States, and that explains, perhaps, why nothing was said at that stage, but then section 2B was introduced undoubtedly, as your Honour the Chief Justice puts to me, on the basis of the then understanding of the law, namely that no part of the Trade Practices Act is bound with the State, although it had been held by then that at least orders under section 163A would bind the State, and we refer to the Grace Bros Case in the written submissions.

We would say, with respect, that in so far as section 2B now provides that the State, for example, of New South Wales will be bound, it is so far as the Crown carries on a business either directly or by an authority, and there is then a question as to how Part IV, dealing with corporations, will operate.  That is not a question which we would say directly affects the operation of Part V, but we accept that the addition of sections 2B and 2C was based upon an understanding that otherwise the Act would not, in any respect, affect the State itself. 

So in answer to your Honour’s question, I think we would say there is no great inconvenience in revisiting the question of whether Part V binds conduct engaged in on behalf of the State, but there is specific provision in relation to Part IV and Part XIB, which may now have to be considered in the future if that question were to arise again.

GUMMOW J:   The first question is whether there is any occasion to revisit, because unless you can bring yourself within section 75B, it seems, can bring the State within section 75B, you do not get off the ground, under the Act.

MR BASTEN:   Well, we would say that section 6(3) is relevant in so far as there is distribution of material in breach of section 52 via the electronic ‑ ‑ ‑

GUMMOW J:   No, no, no we are going round in circles.

MR BASTEN:   I am sorry.

GUMMOW J:   I thought you had agreed in discussion with the Bench that the State was sued by virtue of section 75B.

MR BASTEN:   No, I did not mean to limit it in that way, your Honour.  I was talking about the postal services provisions and the use of the electronic ‑ ‑ ‑

GUMMOW J:   Yes, yes, but we are sued as a person.

MR BASTEN:   Well, in either case, it would depend upon the State being a person.  The textual referent must be the word “person” as opposed to “corporation”, in both sets of provisions.

GUMMOW J:   Well, that is an issue that was not in Bradken.

MR BASTEN:   No.

GUMMOW J:   If that is decided against you, that is the end of it.

MR BASTEN:   It is the end of it on one aspect, your Honour, yes.  The question then becomes whether the corporations should also be excluded from the operation of the Act as co-venturers with the State, pursuant to what is sometimes referred to as the second limb of Bradken.  And that, we say, is a question which depends primarily upon the interpretation of the Trade Practices Act.  It does not, in its own terms, necessarily depend upon the operation of section 64 of the Judiciary Act because it is not said that those corporations, as such, are the State, nor, of course ‑ ‑ ‑

GLEESON CJ:   Does it depend to some extent on the facts that emerge from that agreed bundle of documents?

MR BASTEN:   No, I think not, your Honour.  There is reference in the Full Court judgment to an argument but faintly put that FANMAC was the State, but we would say if it be the State, then we can return to our section 64 argument or our interpretation argument to say that it was bound by the Trade Practices Act in any event, in that case as a corporation.

HAYNE J:   Would the second limb question depend upon the exact nature of the relationship between those whom we have been referring to as co‑venturers and the State of New South Wales in the venture?

MR BASTEN:   Well, it might, depending upon the answer to the first question, your Honour.  If the answer to the first question was that the conduct of the Crown itself might fall within the scope of the Act, then it would appear to us that there would be no basis for saying that a corporation whose conduct on the face of it falls within the scope of the Act would not be caught.  In other words, it would not depend upon the nature of the venture at all.  If the argument were otherwise, then it may be said that it could depend upon the terms of the venture, but in this case we say the principle put against us of prejudice to the Crown is simply not an appropriate principle and the conduct required is not conduct which is specified in any way by any State statute or State requirement under the deeds.  So, whilst we accept in theory there could be an issue there, we say in this case there is not.

Your Honours, I accept and I do not of course wish to argue against the proposition that Bradken does not in its terms deal with the issues before this Court.  So that in a sense it may be we do not need leave to reopen.  If that is the case, then the argument I would seek to put can be dealt with on its substantive merits, but the basis on which we say the broader effect of the Bradken judgment is open to reconsideration is on the basis that there was no consideration of the operation of section 64 of the Judiciary Act.

GAUDRON J:   Can I interrupt you there.  You say this, do you, that the only reason “person” does not include a State in sections 75B and 6(3), if I have got those sections right, is because of the approach to construction that was rejected in Bropho, as it were?

MR BASTEN:   Yes.

GAUDRON J:   Is that what you say?

MR BASTEN:   Well, I am not quite sure whether - your Honour, I think we would phrase the question in a slightly different way.  The question is whether the term “person” in those provisions includes persons who act on behalf of ‑ ‑ ‑

GAUDRON J:   No, you have not sued anybody who acted on behalf of; you have sued the State.

MR BASTEN:   Yes, but their conduct - the conduct of the State is the conduct of those who act for it.

GAUDRON J:   Of course it is, but they are not parties.  If you want to go and join the person who is in fact sitting in the Treasurer’s office or the Premier’s office, that is one thing, but you have sued the State on the basis that it is its acts that are in issue in these proceedings.

MR BASTEN:   Yes, well ‑ ‑ ‑

GUMMOW J:   Do you not first have to persuade us on the construction of the Act?

MR BASTEN:   Well, I am not ‑ ‑ ‑

GLEESON CJ:   If there is a question of the meaning of the word “person” in section 75B of the Act, that question has to be decided in the light of the provisions of section 2A, does it not, and now section 2B?  Those two provisions throw light on the meaning of the word “person” in section 75B, do they not?

MR BASTEN:   Well, that is certainly one issue, your Honour, we accept that.  Perhaps I can come back to your Honour the Chief Justice’s question.  The Crown Proceedings Act of 1988 provides that proceedings by or against the Crown shall be brought ‑ ‑ ‑

GUMMOW J:   What has that to do with federal jurisdiction?

MR BASTEN:   It is an answer, your Honour, to the question as to why the State of New South Wales is the defendant appropriately named in relation to the conduct of persons.  That was ‑ ‑ ‑

GUMMOW J:   It cannot be otherwise in Chapter III?

MR BASTEN:   I am sorry, your Honour.

GUMMOW J:   It cannot be otherwise, can it?  You are in federal jurisdiction.

MR BASTEN:   Yes.

GAUDRON J:   For the purposes of Chapter III, you sue the State.

MR BASTEN:   Yes.

GUMMOW J:   It is what Sir Owen Dixon said in the Banking Case, there is nothing new about this.

MR BASTEN:   No, I am not doubting that, the State made ‑ ‑ ‑

GAUDRON J:   And the Constitution subjected the State of New South Wales to suit?

MR BASTEN:   Yes.

GAUDRON J:   In matters of federal jurisdiction in 1900, we do not have to look at that Act.

MR BASTEN:   No.

GAUDRON J:   1901, I should have said.

MR BASTEN:   But the State can be sued in relation to the conduct of its employees or its corporate authorities and all I was seeking to say in relation to the application of the Trade Practices Act and the terms “person” and “corporation” there is that they may be covered, whether or not the State as a juristic entity is itself covered.  So that, in Bradken the question was whether a corporation, which was indeed the State, which was, I accept, a party to the proceedings because it could sue and be sued in its own right, was subject to the Trade Practices Act.  But it is a question I, perhaps, do not need to go into further for the purposes of this part of the argument.  In relation to your Honour Justice Gaudron’s question, which I think was to the effect, do I need to say more in relation to ‑ ‑ ‑

GAUDRON J:   It is not what you need, it is what you are saying. 

MR BASTEN:   I may have forgotten the thrust of it.

GAUDRON J:   My question is, are you saying that “person” includes State of New South Wales, includes the States?

MR BASTEN:   Yes, and is that all?

GAUDRON J:   Yes, that really is the question, “Does person mean States”?

MR BASTEN:   Yes.

GAUDRON J:   Or, “include States”?

GLEESON CJ:   In section 75B does person include Commonwealth?

MR BASTEN:   On the same reasoning, your Honour, I do not think we would necessarily put forward a different answer.  There may be a construction point which arises because of the operation of sections 2A and 2B by which the Commonwealth is deemed to be a corporation and hence undoubtedly is a person, although one does not need to go down that line once one is a corporation, perhaps, but we would ‑ ‑ ‑

GLEESON CJ:   Deemed in certain limited circumstances?

MR BASTEN:   Yes.  Well, and possibly not for those purposes.  That may well be right, your Honour.  I am sorry, I had not considered the position of the Commonwealth in relation to that argument.  Can I just come back to the argument your Honour was putting to me because I was going to deal with it in two stages.  The question that your Honour raises, in substance, as we would understand it, is whether or not there is an inference to be drawn by way of statutory construction from the Trade Practices Act as to whether it does not include in the term “person” either the State or the Commonwealth because of the express provision in 2A, 2B and so on.

We would say that that question needs to be asked in the context not only of the express provision but in terms of the silence of the Trade Practices Act in other respects and at the relevant times in relation to the State and we say that the approach one then adopts is to view the construction question by reference to not only the terms of the Act itself but also the terms of section 64 of the Judiciary Act and what we were seeking to argue, consistently with various authorities to which I was going to come very shortly, is that where an Act is silent in respect of the Crown, either partly or in whole, then one can rely upon the operation of section 64 of the Judiciary Act to pick up that law and apply it to the Crown.

In other words, we seek to argue that there is no textual inconsistency between the two Acts, properly understood, and that accordingly the terms of the Trade Practices Act would not be read down perhaps in the way which they might be if it were viewed in isolation but that is the ‑ ‑ ‑

GLEESON CJ:   But this Act was no longer silent following the inclusion of section 2B which in turn followed the decision in Bradken.

MR BASTEN:   Well, 2B, your Honour, is post the commencement of these proceedings.

GLEESON CJ:   Yes.

MR BASTEN:   Certainly post the decision in Bradken.  I am not sure if your Honour is putting this point to me on the basis of the appropriate construction of the Act or whether it is a reason for not reconsidering the approach adopted in Bradken.

GLEESON CJ:   Both.

MR BASTEN:   Both, yes.  Well, we say that the principal reason, perhaps, for reconsidering the approach adopted in Bradken is that it did not consider the operation of this Act in relation to the Judiciary Act, that it did not apply the principles which had been espoused in Maguire v Simpson and which have subsequently been approved by this Court and that there is, in a sense, an inconsistency between the approach adopted there simply by application of the Bombay statutory construction principle and the approach which has been adopted in other cases.

Now if that is correct we say that the statutory construction point should be differently viewed and, although 2B may depend upon the correctness of Bradken, we would wish to say that it does not necessarily provide an overwhelming reason for this Court not to consider the operation of this Act in the light of the Judiciary Act.

HAYNE J:   What is the hypothesis for this branch of your argument?  Is it a hypothesis about the true construction of, say, section 6 of the Act, when, in effect, it says a person shall not send misleading material through the mail?  Do you hypothesise that on its true construction a person includes or excludes the State of New South Wales?

MR BASTEN:   We hypothesise that it includes.

HAYNE J:   If that is the hypothesis then why do we get into section 64 or Crown Proceedings legislation?

MR BASTEN:   Well, if the hypothesis is accepted, your Honour, we do not.  The argument against us requires us to consider whether that hypothesis may be supported, not only on the basis of the terms of the Act itself but also on the basis of the ambulatory effect of section 64.

HAYNE J:   Do I understand you then to say that section 64 is an aid to the construction of the provisions like section 6 and it is an aid to determining whether, when it says a person shall not send misleading material through the post, “person” includes the State.

MR BASTEN:   We would accept that much, your Honour, and we would say something more.  We would say that the operation of section 64, of its own force, is sufficient to pick up and apply a law which is not inconsistent and which does not apply in its own terms.  So that it depends whether that argument your Honour put is accepted.  If it is accepted in its terms we do not need to get to section  ‑ ‑ ‑ 

HAYNE J:   Well I am trying to understand your argument, Mr Basten.

MR BASTEN:   I am saying, the way your Honour puts it, we do not need to get to section 64, if the textural argument is accepted.  If the textural argument is doubtful because of, for example, a presumption that the State is not bound, then we need to get to it.  So, as I understand it, we should not be precluded from putting an argument which would support our case on a different basis, namely another Commonwealth statute.

GUMMOW J:   Take this word “personal”, for example.  It is in section 45D and in a number of other provisions in Part IV.  It is in section 76 dealing with pecuniary penalties.

MR BASTEN:   Yes.

GUMMOW J:   Do you say that the State, because it is a person, is subjected to Part IV and therefore to pecuniary penalties under 76?

MR BASTEN:   No, your Honour.

GUMMOW J:   So you say “person” means different things in different sections?

MR BASTEN:   It may do.  One of our concerns with Bradken is that perhaps inconsistently ‑ ‑ ‑ 

GUMMOW J:   And different things therefore in 75B itself?

MR BASTEN:   Not necessarily within 75B, your Honour.

GUMMOW J:   Well, 75B applies to Part IV and Part V.

MR BASTEN:   Yes.

GUMMOW J:   I thought we just said the State was not a person for Part IV.

MR BASTEN:   The question is whether or not - there are a number of separate issues.  One is whether or not Part IV is picked up and applied to the State, either in its own terms or by the Judiciary Act.  That is a question which we say is not relevant to the present case except for the purpose of statutory construction.  The second aspect of your Honour’s question is that obviously where there are penalties it may well be that a different principle applies, and that the State, otherwise bound by the Act, is not on the Cain v Doyle principle subject to those provisions which impose a penalty.  We would understand Bropho’s Case to be clear authority for the proposition that one looks at particular provisions in their own terms, and the context and subject matter of the legislation may itself indicate that some provisions bind the Crown, some do not.  I use the term “Crown” in ‑ ‑ ‑ 

GLEESON CJ:   Mr Basten, it appears to us that it may be convenient if we were to retire for a short time just to consider the order in which the issues that you wish to raise should be addressed.  We will adjourn for a short time.

AT 11.34 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.57 AM:

GLEESON CJ:   Mr Basten, have you said everything you want to say in relation to the application for leave to reopen what has been referred to as the first limb in Bradken?

MR BASTEN:   No, not really, your Honour, because what I wanted to do was to deal with the question of the application of section 64 of the Judiciary Act.  It may be that that is ‑ ‑ ‑

GLEESON CJ:   Putting that to one side.

MR BASTEN:   Putting that to one side, might I make one other point?  In answering questions as to the textual application of the Trade Practices Act, the points which were put against me, or put to me by the Bench, related to the role of the State in the litigation.  On one basis, the role of the State is critical to the question of the existence, or otherwise, of federal jurisdiction.  I am not sure that this has any bearing on the precise basis on which your Honour asked the question, but we say that the federal jurisdiction may arise absent the presence of the State by virtue of the jurisdiction of the Federal Court under the Trade Practices Act in section 77(i) and 76(ii) of the Constitution. That may not go to the issue but I merely say it because it was, perhaps, a point I had not made in relation to ‑ ‑ ‑

GLEESON CJ:   Thank you.  Is there anybody else who wants to support Mr Basten’s application for leave to reopen the first limb of Bradken?  In relation to question 1, and the application for leave to reopen, what has been referred to in argument as the “first limb of Bradken”, as at present advised the Court is not persuaded that the issue of the first limb of Bradken arises in relation to the claim against the State and we would be more assisted by argument concentrating on the questions of construction of the legislation that have been raised in the various written submissions.  This is not intended to curtail anything that anybody wants to say about section 64 or about the second limb of Bradken.  Yes, Mr Basten.

MR BASTEN:   Your Honours, might I then go to the question of the operation of the section 64, because I do so on the basis that section 64 has an operation which may affect the question of the construction of the Trade Practices Act and may depend upon it and the proposition that we say arises in the present case, as we read the submissions, is that while section 64 may pick up and apply a State law which, in its own terms, does not bind the Crown, nevertheless it does not have that effect with respect to a later Commonwealth law, because there would be an inconsistency between that result and the inference drawn from the silence in the later law, dependent, of course, upon the application of the presumption in Bropho or Bombay, in the case of silence.

As was pointed out in Maguire v Simpson -

and then there is a reference to Justice Gibbs himself -

Downs v Williams is distinguishable from a case arising under s 64, because that decision involved (whereas s 64 does not) -

and may I interpolate here that that is a misstatement as well because section 64 may of course involve one legislature problems, but in any event what was being said in the context of Evans Deakin was that Downs v Williams:

involved (whereas s 64 does not) the reconciliation of two statutes of the one legislature.  For that reason it is unnecessary to consider whether the decision in Downs v Williams should be overruled.

That was said a couple of years before Moorebank’s Case.  In our submission, the effect of the statement in Moorebank’s Case is plainly to show that Downs v Williams has continuing present day application and what was said ‑ ‑ ‑

GAUDRON J:   I am wondering also in that context, Mr Solicitor, if there is not a difference in a case where there is an antecedent justiciable issue in federal jurisdiction and a case where there is not.  There clearly was an antecedent justiciable issue in federal jurisdiction in Evans Deakin.

MR KATZ:   Your Honour says that there was?

GAUDRON J:   Well, it was a claim against the Commonwealth.  It automatically came into ‑ ‑ ‑

MR KATZ:   I am sorry, into federal jurisdiction by reason of the fact that the claim was against the Commonwealth.  Yes, that is ‑ ‑ ‑

GAUDRON J:   Yes, whereas in this case it can only get into federal jurisdiction either by reason of the joinder perhaps of the other parties or breach of the Trade Practices Act.

MR KATZ:   The Full Court of the Federal Court took the view that the matter was within federal jurisdiction by reason of the fact that the appellants were making claims under the Trade Practices Act itself.  Your Honours, could we imagine that there was only one respondent to the proceedings, namely, the State of New South Wales.  It does seem to ‑ ‑ ‑

GUMMOW J:   Well, the jurisdiction would have to have been rooted in section 76(ii).

MR KATZ:   Yes, your Honour, and what was said by the Full Court - perhaps I might just direct your Honour’s attention to this.  It is on page 392 in the appeal book where their Honours express the view that, though the Trade Practices Act claims might fail, nonetheless they would be sufficient to found federal jurisdiction in the matter.

GUMMOW J:   Well, Burgundy Royale is a case on the accrued jurisdiction, so it comes to back to “matter” in section 76(ii).

MR KATZ:   Well, Burgundy Royale was resolved as though Bradken’s Case had - I am sorry, I do not think I am putting this correctly.  Burgundy Royale involved the application of the Trade Practices Act to a Territory and it was said in Burgundy Royale that nonetheless though the Act did not apply to a Territory, nonetheless that claim was not so unarguable that additional claims made were not themselves in federal jurisdiction.

There may be a question as to whether Burgundy Royale is really an appropriate authority for the Full Court to have relied on here, because Bradken’s Case, it is true, did not deal with Territories, whereas Bradken’s Case had dealt squarely with the States.  But, nonetheless, the position was taken that this was in federal jurisdiction, and we are content to proceed on that basis.

Your Honours, I see the time, but may I simply make one point to Justice Gaudron in response to something that your Honour did say to me.  It is true that every claim against the Commonwealth is necessarily one in federal jurisdiction by reason of 75(iii).  The same is not true of every claim against a State.  The only occasion upon which the States are explicitly mentioned in either 75 or 76 is 75(iv) - the diversity jurisdiction - and it is plain that there is no attempt here - has been no attempt, and could have been no attempt - to invoke the Federal Court’s federal diversity jurisdiction.

GAUDRON J:   There may be federal jurisdiction in this case, or at least it seems fair to assume that there may be federal jurisdiction, because it is one controversy.

MR KATZ:   Yes, it has been so held by the Full Federal Court, and there has been no appeal from that conclusion.  If that is a convenient time?

GLEESON CJ:   Very well then, we will adjourn until 10.15 in the morning.

AT 4.18 PM THE MATTER WAS ADJOURNED
UNTIL THURSDAY, 3 SEPTEMBER 1998