Combet & Anor v Commonwealth of Australia & Ors

[2005] HCATrans 477

[2005] HCATrans 477

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S359 of 2005

B e t w e e n -

GREG COMBET

First Plaintiff

NICOLA ROXON MP

Second Plaintiff

and

COMMONWEALTH OF AUSTRALIA

First Defendant

THE HONOURABLE KEVIN ANDREWS MP

Second Defendant

SENATOR THE HONOURABLE NICHOLAS MINCHIN

Third Defendant

For directions

GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 3 AUGUST 2005, AT 4.26 PM

Copyright in the High Court of Australia

__________________

MR J.K. KIRK:   May it please the Court, I appear for the plaintiffs.  (instructed by Maurice Blackburn Cashman)

MR H.C. BURMESTER, QC:   May it please the Court, I appear with MS K.J. GRAHAM for the defendants.  (instructed by Australian Government Solicitor)

HIS HONOUR:   Yes, Mr Kirk.

MR KIRK:   Your Honour, the Registry informed the parties that there were three issues that we should seek to address in the directions hearings and they were the pleadings, how to bring the matter before the Full Court in terms of facts and so forth and the position of the State Attorneys.

HIS HONOUR:   Yes.

MR KIRK:   Dealing with the last issue first, a 78B notice issued on Monday.

HIS HONOUR:   Yes, I saw that.

MR KIRK:   As yet, we have no definitive responses, so I am afraid I cannot inform the Court any further on that topic.  Turning to the first issue of pleadings, we of course began with a writ of summons and statement of claim.  We seek to amend that document in some minor respects.  Can I hand to your Honour ‑ ‑ ‑

HIS HONOUR:   It may be major after I have spoken to you.  Yes, go on.

MR KIRK:   Could I hand to your Honour a copy of what we propose.  It may well be that we would seek leave to make further amendments.  That is the original.

HIS HONOUR:   Yes.

MR KIRK:   If I can briefly take your Honour through the changes.  They are very brief.  At paragraph 11 on page 7 we have added some particulars in relation to the radio advertisements.  At paragraph 12 on page 9, in relation to the putative television advertisements, we have indicated that further particulars may be supplied if and when such advertising commences.  On page 10 at paragraph 14 we have sought to narrow the case down to focus on the particular outcome which was focused upon by the Solicitor‑General for the Commonwealth in the interlocutory hearing on Friday.  That is, of course, a departmental outcome from Appropriation Act (No 1) 2005-2006.  Then there is a correlative change in paragraph 16.

On that topic, however, your Honour, I understand from my discussions with my learned friend today that it is not impossible that the Commonwealth may seek to point to some other appropriations.  Now, your Honour, in light of the submissions put by the Commonwealth Solicitor‑General, it would be, with great respect, a little remarkable if the Commonwealth were at this stage to seek to point to some other account from which it is spending this money.  However, that appears to be a right that the Commonwealth is seeking to reserve to itself.  That illustrates obviously the importance of having a defence in this matter as soon as possible.

HIS HONOUR:   It illustrates, if I can interrupt you, the necessity for a properly formulated statement of claim so that there can be a defence and demurrer or a demurrer.  That is one way of getting it before the Full Court.  Now, is there any television advertising particularised here?

MR KIRK:   No, it has not yet commenced.  It has been foreshadowed but not yet commenced, your Honour.

HIS HONOUR:   Are there contracts?

MR KIRK:   We do not know, your Honour.

HIS HONOUR:   Wait a minute – contracts, the performance of which would be enjoined if you were successful.  There is a prospect of that, is there not?

MR KIRK:   Yes.

HIS HONOUR:   Well, are not the other parties to those contracts proper, if not necessary, parties to an injunction application?

MR KIRK:   Your Honour, the obvious primary party is the Commonwealth.

HIS HONOUR:   No, it is not the obvious primary party at all.  The obvious primary party, it seems to me, is the third defendant, who is issuing the drawing rights under section 27 of the Financial Management and Accountability Act.

MR KIRK:   Yes, and indeed in Brown v West it was the Finance Minister, Mr West, who was the defendant.

HIS HONOUR:   Exactly.

MR KIRK:   In that case, however, there were no ‑ ‑ ‑

HIS HONOUR:   Just listen to me, Mr Kirk, it is a good idea.

MR KIRK:   Yes, your Honour.

HIS HONOUR:   The identification of the Commonwealth is pointless, is it not?  What do you mean by enjoining the Commonwealth?

MR KIRK:   Well, your Honour, the Commonwealth is bound by sections 81 and 83 of the Constitution which is the ultimate foundation of this case. Whilst it is true that under the Acts about drawing rights it is the Finance Minister which issues the drawing rights, nevertheless, the constitutional context is the Commonwealth being bound by sections 81 and 83. Further, part of the context here ‑ ‑ ‑

HIS HONOUR:   Just a minute. Sections 81 and 83 are, as it were, obligations, if you like, not anchored in terms in any particular arm of the Commonwealth. You want injunctive relief, do you not?

MR KIRK:   Yes, your Honour, along with declarations.  It may be in the end a declaration is the most important part of the relief, as indeed was granted in Brown v West.

HIS HONOUR:   The critical statute seems to me section 27 of the Financial Management and Accountability Act 1997 and subsection (5) of that says that:

A drawing right has no effect to the extent that it claims to authorise the application of public money in a way that is not authorised by an appropriation.

And that gets you back into section 83 of the Constitution.

MR KIRK:   Yes.

HIS HONOUR:   Now, what is the position about enjoining third parties?

MR KIRK:   Well, your Honour, the injunctive relief we seek is directed to the Commonwealth.

HIS HONOUR:   But why are not these contracting parties appropriate parties?  You want to achieve a situation where they cannot get paid.

MR KIRK:   Well, your Honour, the fact that the third defendant is restrained from issuing any drawing rights does not of itself affect the status of whatever contracts there are, and we do not know what contracts there are.

HIS HONOUR:   It is going to cause the Commonwealth to default.

MR KIRK:   It may do.  That does not mean, however, I think, that a judgment debt could not be obtained against the Commonwealth.

HIS HONOUR:   I am not going to argue with you any more, Mr Kirk.  I am just telling you what strikes me.  If it is not in proper shape it will not get before the Full Court and if it is to get before the Full Court it will be getting there as soon as possible, which is Monday, 29 August.

MR KIRK:   Your Honour, I will certainly, with great respect, take on board what your Honour has said and discuss it with those who instruct me.  Can I indicate in relation to our understanding of the facts here, my instructing solicitors wrote to the second defendant on 18 July and on 25 July seeking a whole range of information specifically to try to find out what sort of contracts there are, whether drawing rights have been issued, whether money has been spent, the size of the campaign and so forth, in order to understand the factual position better.  Those letters still have not been answered.  We are on the outside looking in. 

HIS HONOUR:   That is right.  We will ask Mr Burmester about that in a minute.

MR KIRK:   May it please the Court.

HIS HONOUR:   Yes, Mr Burmester.

MR BURMESTER:   The way we saw this matter proceeding was that the defendants ought to put on a defence.  That would help to clarify areas of dispute.  Either both plaintiffs and the defendants ought to indicate whether there is further evidence that they sought to tender.  From the defendants’ point of view, I am instructed there may be a wish to produce a little bit more evidence.

HIS HONOUR:   What would that be likely to be, do you know?

MR BURMESTER:   Going principally to the nature of industrial action that may or may not have occurred or when it occurred, who it occurred by.  Not something that I think would be fairly controversial, it would be rather just drawn from public sources, but it was felt there may be need for that sort of evidence.  Then we may also wish to put before the Court, and it may not be in the form of evidence, additional material about how Appropriation Acts have been drafted, the sorts of things that have been included in particular Appropriation Acts in terms of practice.  That may not come through affidavit; that could be dealt with otherwise.

HIS HONOUR: Yes. On that subject, the matter of appropriations at the time of the adoption of the Constitution, as understood in England, I do not know if you are familiar with this book by Durell, The Principles and Practices of the System of Control Over Parliamentary Grants, published in 1917.  That explains how all these things were understood, I think.

MR BURMESTER:   Thank you, your Honour, for the reference.  We will follow that up.

HIS HONOUR:   It is a rather obscure book.  It is not readily found, but it is quite useful I think.

MR BURMESTER:   Thank you for that.

HIS HONOUR:   Now, I interrupted you.

MR BURMESTER:   Until those procedural steps are done, the putting in of a defence, any reply, any further evidence that any of the parties may wish to submit, I guess we would then be able to judge whether a case stated was quickly able to be put together ‑ ‑ ‑

HIS HONOUR:   Yes.  It does not sound like a demurrer.

MR BURMESTER:   ‑ ‑ ‑ and whether that is the best way to proceed.

HIS HONOUR:   It does not sound like a demurrer.

MR BURMESTER:   It does not sound like a demurrer.  I think from the defendants’ point of view we thought the demurrer was probably not the way to go, that we should put in a defence and then probably a case stated.

HIS HONOUR:   Yes, but that in turn depends upon absence of unresolved factual disputes.

MR BURMESTER:   It does.  We do not expect there necessarily ought to be any particular difficulties, but we have not yet gone through the pleadings ‑ ‑ ‑

HIS HONOUR:   Now, what about these factual matters that Mr Kirk has been trying to elicit?

MR BURMESTER:   Some of them, your Honour, I think will become apparent in the defence in responding to the pleadings.  For instance, the claim about other appropriations, the particulars about expenditure, some of that may be clarified.  It may not be fully answered in terms of the questions he originally sought answers to, but to the extent that the material seems relevant to the pleadings, we would certainly obviously answer them as part of the defence.

HIS HONOUR:   Yes.  Now, it is obviously in the public interest that any uncertainty about this be dispelled one way or the other as soon as possible, hence the Court’s wish to have it ready as soon as possible for 29 August.

MR BURMESTER:   We are certainly happy to do our best to meet that proposed date, your Honour.

HIS HONOUR:   Yes.  I think I should hand you back this draft, Mr Kirk.  Sit down if you would, Mr Burmester.  Is there anything else you needed to say?

MR BURMESTER:   No, your Honour.  I did have some short draft minutes of orders here, if that would assist.

HIS HONOUR:   I thought the best thing I should do this afternoon would be to give the plaintiffs leave to amend their statement of claim as shortly as possible and for it to come back before me after the Adelaide sittings in Sydney on Friday of next week.  Does that sound sensible?

MR BURMESTER:   Yes, your Honour, we are happy to proceed that way.

HIS HONOUR:   Then we should have a better idea of ‑ ‑ ‑

MR BURMESTER:   By then we will have a better idea, that is certainly true.  We can undertake to certainly have our defence filed by then and an indication of further evidence, I think, if that is the proposal.

HIS HONOUR:   Yes.  How much longer do you need?

MR KIRK:   Close of business Friday this week would be fine, your Honour.

HIS HONOUR:   But completion of your amendments may depend upon further material being disclosed to you by the Commonwealth, may it not?

MR KIRK:   It may do, particularly in light of what your Honour raised about contracts and so forth.

HIS HONOUR:   Yes.  There may be some way in which you can formulate your claim where you do not get into this injunction territory.

MR KIRK:   That might be right, your Honour, with respect, as indeed of course in Brown v West the Court simply declined to grant injunctive relief and put it to a side.  Maybe that is a lesson that can be learnt.

HIS HONOUR:   In the AAP Case I think injunctive relief was sought but the problem never had to be faced because it got to the Court on a demurrer I think. I will just check. Yes, that is right. But it appears from 134 CLR 338 at 339 that “an injunction restraining the defendants and each of them” – the defendants were the Commonwealth and the – I am not sure which Minister it was.

MR KIRK:   It may have been the Prime Minister who was administering the actual program, but I am not entirely sure.

HIS HONOUR:   No, the Minister for Social Services it was.  It was the equivalent of the second defendant here.  It was not the equivalent of the third defendant.  This is before the Financial Management and Accountability Act 1997.

MR KIRK:   Yes.  In relation to the issue your Honour raises, the declaratory relief is certainly the primary relief we seek, so obviously I will need to speak to Mr Gageler and those who are instructing.

HIS HONOUR:   Yes, I am not binding you to anything.  I am just trying to alert you to ‑ ‑ ‑

MR KIRK:   But I suspect that will be the primary and perhaps only relief which we seek, your Honour, but I will need to get instructions on that.

MR BURMESTER:   Your Honour, one thing I would mention is that the third defendant, we understand, has delegated the power to issue drawing rights, so we were assuming in a sense that one reads in “or any delegate thereof” in a sense that ‑ ‑ ‑

HIS HONOUR:   Yes, where is the power of delegation, do you know?

MR BURMESTER:   Towards the end of section 57 or 62, around there, your Honour.  I am sorry, I do not have the Act in front of me.

HIS HONOUR:   Yes, 62:

The Finance Minister may, by written instrument, delegate to an official any of the Finance Minister’s powers or functions under this Act, except the power to make Orders.

MR BURMESTER:   I understand there is such a delegation, I guess.

HIS HONOUR:   In respect of this appropriation?

MR BURMESTER:   Well, I think it is a general delegation in respect of appropriations generally.  It is not a specific one in relation to this particular appropriation.

HIS HONOUR:   Right.  Well, that does not seem to change the proposition of the parties, does it, necessarily?

MR BURMESTER:   No, I think the Minister can be seen as representing any delegates that he may have authorised.

HIS HONOUR:   Thank you.  We may have heard from the States too by Friday.

MR KIRK:   Yes.  We did in our covering letter ask for an urgent response, your Honour.

HIS HONOUR:   Yes.  Now, the amended statement of claim, if amended, if it goes on on or before next Monday, is there a possibility of pleading or demurring to it by the Thursday or do you prefer to preserve your situation and look at it on Friday or ‑ ‑ ‑

MR BURMESTER:   I think we should be able to do that, your Honour, by Thursday.  I am assuming it is not going to be completely rewritten, so there may be some changes, but on that basis I will undertake to have the defence or demurrer delivered by the end of Thursday.

HIS HONOUR:   Shall I make it at noon on the Friday?  That would enable you to get up from Canberra if you are coming, Mr Burmester.

MR BURMESTER:   Yes, your Honour, that would be fine.  The Solicitor‑General may appear.  I just felt the need to check.

HIS HONOUR:   Yes, let us make it noon.

1.I grant leave to the plaintiffs to file an amended statement of claim on or before 8 August;

2.The defence and any demurrer is to be filed and served on or before 11 August;

3.I stand the matter over for further directions to 12 August 2005 in Sydney before me at noon; and

4.Costs of today be reserved.

What is the role of the Auditor-General in, as it were, overseeing the adequacy and observance of appropriations?  There is a new Audit Act in 1997 as well.

MR BURMESTER:   There is and clearly the Auditor‑General would look at expenditure from departments.  It would clearly fall within his remit, if he was concerned or had any concern.  He signs off on the accounts every year of each department and agency.

HIS HONOUR:   Yes.  Is there anything else?

MR KIRK:   If your Honour could certify for counsel.

HIS HONOUR:   You do not have to certify under the Rules now.  I suggest you read them.

MR KIRK:   May it please the Court.

HIS HONOUR:   I will now adjourn.

AT 4.47 PM THE MATTER WAS ADJOURNED
UNTIL FRIDAY, 12 AUGUST 2005