Construction Industry Training Board v Transfield Services (Australia) Pty Ltd (ACN 093 114 553)

SUPREME COURT OF SOUTH AUSTRALIA
(Full Court: Civil)
CONSTRUCTION INDUSTRY TRAINING BOARD v TRANSFIELD SERVICES (AUSTRALIA) PTY LTD (ACN 093 114 553)
[2017] SASCFC 103
Judgment of The Full Court
(The Honourable Chief Justice Kourakis, The Honourable Justice Stanley and The Honourable Justice Nicholson)
17 August 2017
CONSTITUTIONAL LAW - OPERATION AND EFFECT OF THE COMMONWEALTH CONSTITUTION - POWERS WITH RESPECT TO PROPERTY - POWER OVER PLACES ACQUIRED FOR PUBLIC PURPOSES (CONSTITUTION, S 52(I))
At issue is whether the defendant is liable to pay training levies imposed by the plaintiff, pursuant to South Australian legislation.
The answer to this turns on whether land on which the defendant was undertaking building and construction work is a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution. The land is and was at all material times owned by the Australian Rail Track Corporation, an incorporated, wholly Commonwealth owned company.
Pursuant to 6SCR 211, two questions were referred to the Full Court for determination ahead of all other issues in the action:
1. Did the land within South Australia held by the ARTC that constituted ARTC’s rail network, constitute a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution between 2009 and 2013?
2. If the answer to question 1 is “No”, which, if any, of the following categories of land within South Australia held by the ARTC that constituted ARTC’s rail network, constituted a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution between 2009 and 2013?
a) Land acquired by the ARTC from the Australian National Railways Commission pursuant to the declarations under s 67AE(1)(a) of the Australian National Railways Commission Act 1983 (Cth) referred to at paragraph 14 and 15 of the Statement of Agreed Facts.
b) Land acquired by the ARTC from other parties subsequent to 1 July 1998.
Held, per Stanley J (Kourakis CJ and Nicholson J concurring):
1. The ARTC is a body through which the Commonwealth operates in the field of railways construction, maintenance and access. The ARTC is an emanation of the Commonwealth and the ARTC rail network land is a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Constitution. The first question posed on referral should be answered: “Yes”. The second question should be answered: “It does not arise” (at [121]).
Australian National Railways Act 1917 (Cth) ss 7, 7(2), 8(1), 9, 13(1), 13(2), 16A, 16, 22, 23, 25, 40, 41, 42, 44, 46; Australian National Railways Act 1975 (Cth) ss 1(3), 7, 8; Commonwealth Railways Act 1917 (Cth) s 5(1); Corporations Act 2001 (Cth); Construction Industry Training Fund Act 1993 (SA) ss 3, 4, 12, 24(1); Australian Constitution Ch 1, ss 3, 6, 51, 51(xxxiii), 51(xxxiv), 52, 52(i), 61, 63, 64, 69, 75, 75(iii), 90, 98, 102, 104, 107, 108, 109, 114; Judiciary Act 1903 (Cth) ss 64, 78A; Australian National Railways Commission Act 1983 (Cth) s 67AE(1)(a); Supreme Court Civil Rules 2006 (SA) r 211; Remuneration Tribunals Act 1973-1974 (Cth); Railways (Transfer Agreement) Act 1975 (SA) s 4; Railways Agreement (South Australia) Act 1975 (Cth) s 5; Commonwealth Places (Application of Laws) Act 1970 (Cth); Commonwealth Places (Mirror Taxes) Act 1998 (Cth); Federal Airports Corporation Act 1986 (Cth) ss 28(1), 29(1); Territory-owned Corporations Act 1990 (ACT); Commonwealth Banks Act 1959 (Cth); Commonwealth Authorities and Companies Act 1997 (Cth) ss 5, 34, 36, 36(2), 38, 39, 40(1), 41(1), 42, 43, 44, 45(1), 48A; Residential Tenancies Act 1987 (NSW); Companies Act 1938 (Vic), referred to.
Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219, applied.
Allders International Pty Ltd v Commissioner of State Revenue (Vic) (1996) 186 CLR 630; Worthing v Rowell & Muston Pty Ltd (1970) 123 CLR 89; Attorney-General (NSW) & Ors v Stocks & Holdings (Constructions) Pty Ltd (1970) 124 CLR 262; Paliflex Pty Ltd v Chief Commissioner of State Revenue (NSW) (2003) 219 CLR 325; SGH Limited v Commissioner of Taxation (2002) 210 CLR 51; NT Power Generation Pty Ltd v Power and Water Authority & Anor (2004) 219 CLR 90; Queanbeyan City Council v ACTEW Corporation Ltd & Anor (2011) 244 CLR 530; Inglis & Anor v Commonwealth Trading Bank of Australia (1969) 119 CLR 334; Superannuation Fund Investment Trust v Commissioner of Stamps (SA) (1979) 145 CLR 330; State Bank of NSW v Commonwealth Savings Bank of Australia (1986) 161 CLR 639; Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129; Re Residential Tenancies Tribunal (NSW) and Henderson; Ex parte Defence Housing Authority (1997) 190 CLR 410; The Commonwealth v Cigamatic Pty Ltd (In Liquidation) (1962) 108 CLR 372; Municipal Council of Sydney v The Commonwealth (1904) 1 CLR 208; Commonwealth of Australia v Bogle (1953) 89 CLR 229, discussed.
The Federated Amalgamated Government Railway and Tramway Service Association v The New South Wales Railway Traffic Employees' Association (1906) 4 CLR 488; Crouch v Commissioner for Railways (Qld) and Anor (1985) 159 CLR 22; Deputy Commissioner of Taxation v State Bank of NSW (1992) 174 CLR 219; State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253; Bank of New South Wales v Commonwealth (1948) 76 CLR 1; Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466; The Queen v Phillips (1970) 125 CLR 93, considered.

CONSTRUCTION INDUSTRY TRAINING BOARD v TRANSFIELD SERVICES (AUSTRALIA) PTY LTD (ACN 093 114 553)
[2017] SASCFC 103
Full Court: Kourakis CJ, Stanley and Nicholson JJ

KOURAKIS CJ: For the reasons given by Stanley J and for the following supplementary reasons I would answer the first question posed on the referral in the affirmative and for that reason the second question does not arise.
It is convenient to start by referring to the broad constitutional structure in which the Commonwealth operates. Section 3 of the Commonwealth of Australia Constitution Act (No. 63 and 64 Victoria, Chapter 12) provides that the Queen may declare by proclamation within one year after the passing of the Act that the people of the Australian colonies shall be ‘united in a Federal Commonwealth under the name of the Commonwealth of Australia’. Section 6 defines ‘the Commonwealth’ to be the Commonwealth of Australia established by the Act.
Chapter 1 of the Constitution vests the legislative power of the Commonwealth in the Federal Parliament consisting of the Queen, the Senate and the House of Representatives to be called ‘the Parliament of the Commonwealth’. The remainder of Chapter 1 makes provision for the membership of Parliament and, relevantly to this appeal, by ss 51 and 52, its legislative powers. The terms of the conferral of legislative power on the Parliament are to make laws for the peace, order and good government of the Commonwealth. The enumerated legislative powers under s 51 operate concurrently with the legislative power of the States. On the other hand, s 52 confers exclusive legislative power with respect to the seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes, matters relating to the public service departments which are by the Constitution transferred to the Executive Government of the Commonwealth[1] and any other matters declared by the Constitution to be within the exclusive power of the Parliament.[2]
[1]    Section 69 provides that on a date or dates to be proclaimed the Departments of:
•    post, telegraphs and telephone
•    naval and military defence
•    lighthouse, lightships, beacons and buoys
•    quarantine
shall be transferred to the Commonwealth.
Section 69 also provides that the departments of customs and of excise in each State shall be transferred to the Commonwealth on its establishment.
[2]    By s 90 exclusive power over customs, excise and bounties is conferred on the Commonwealth Parliament.
The executive power of the Commonwealth is, by s 61 of the Constitution, exercisable by the Governor-General and extends to the execution and maintenance of the Constitution and the laws of the Commonwealth. Section 62 establishes the Federal Executive Council, on the advice of which the Governor-General must act pursuant to s 63 of the Constitution.
Section 107 of the Constitution provides that every power of the Parliament of a Colony which becomes a State shall, unless exclusively vested in the Commonwealth, continue as at the establishment of the Commonwealth. Section 108 saves, subject to the Constitution, every law in force in a Colony which becomes a State, and the power of the State to amend and repeal that law, until other provision is made by the Commonwealth.
That constitutional structure establishes the Commonwealth as the repository of the sovereign legislative and executive powers of what became the federated States.[3]
[3] The judicial power of the Commonwealth is directly vested in the High Court and such other courts as the Parliament creates or vests with federal jurisdiction by Chapter III.
In Amalgamated Society of Engineers v Adelaide Steamship Co Ltd,[4] (the Engineers case) Knox CJ, Isaacs, Rich and Starke JJ said of the distinction between the Australian and American constitutions:
The combined effect of these features is that the expression “State” and the expression “Commonwealth” comprehend both the strictly legal conception of the King in right of a designated territory, and the people of that territory considered as a political organism.
[4] (1920) 28 CLR 129 at 146-147.
The plurality judgment in the Engineers case also remarked on the distinction between the true prerogative and the statutory authority of the Crown.[5] The seminal passage of Dixon J in Bank of New South Wales v Commonwealth[6] explains:
The matter comes back to the question whether such an organ is within the scope of the expression “the Commonwealth or a person sued on behalf of the Commonwealth.” The “Commonwealth” means the central Government of the country. It is perhaps strictly correct to say that it means the Crown in right of the Commonwealth. But it must be borne in mind that the dual system of government, which is of the essence of federation, involves a legal recognition of the distinct existence of the component polities. It would be difficult otherwise to accomplish a distribution among them of defined powers and authorities by means of a supreme law enforceable by the courts.
The Constitution sweeps aside the difficulties which might be thought to arise in a federation from the traditional distinction between, on the one hand the position of the Sovereign as the representative of the State in a monarchy, and the other hand the State as a legal person in other forms of government (see per Cairns L.J. in U.S.A. v Wagner and goes directly to the conceptions of ordinary life. From beginning to end it treats the Commonwealth and the States as organizations or institutions of government possessing distinct individualities. Formally they may not be juristic persons, but they are conceived as politically organized bodies having mutual legal relations and amenable to the jurisdiction of courts upon which the responsibility of enforcing the Constitution rests. It is from this point of view that the interpretation of s 75 must be approached. Moreover, the nature of the instrument in which the provision is found is not to be ignored. It is devoted, even in the judiciary chapter, to broad propositions in the field of government and it is hardly likely to concern itself with peculiarities of procedure. The purpose of s 75(iii) obviously was to ensure that the political organization called into existence under the name of the Commonwealth and armed with enumerated powers and authorities, limited by definition, fell in every way within a jurisdiction in which it could be impleaded and which it could invoke.
(citation omitted)
That passage recognises that the term the Commonwealth is necessarily of wide import and comprehends ‘the political organisation … armed with enumerated powers and authorities’ in all its manifestations. The purpose of s 75 of the Constitution is to ensure that the adjudication of controversies between the political integers of the federations fell within the jurisdiction of the High Court whatever manifestation they might take. In that passage, Dixon J recognises that the Commonwealth is not limited to a particular juristic entity and that although it was ‘strictly correct’ to equate the Commonwealth with the ‘Crown in right of the Commonwealth’, it had a wider meaning which encompassed ‘the distinct existence of the component polities’. The litigation between the Commonwealth and the States over the validity, or operative effect, of Commonwealth or State legislation, adverted to in the final sentence of that paragraph is between those polities broadly conceived.
[5] Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 143.
[6] (1948) 76 CLR 1 at 362-363.
In Re Residential Tenancies Tribunal (NSW) and Henderson; Ex parte Defence Housing Authority,[7] (Residential Tenancies) the High Court held that the Defence Housing Authority established by Commonwealth legislation was subject to the Residential Tenancies Act 1987 (NSW) in that the Commonwealth legislation was not a code which excluded the operation of the law of New South Wales for the purposes of s 109 of the Constitution. For that purpose a distinction was drawn between the Crown in right of the Commonwealth and the activities in which the Crown engages in exercising those capacities. Gummow J recalled the distinction between the ‘privileges or immunities of ‘the Commonwealth in its executive arm’’ and the legal rights of the Commonwealth arising under Commonwealth statute and protected by s 109 of the Constitution emphasised by Dixon CJ in The Commonwealth v Cigamatic Pty Ltd (In Liquidation):[8]
The Cigamatic doctrine is not necessarily confined to the abridgment or abolition of those aspects of executive authority which in England and in the colonies before federation would have been classified as prerogative preferences, immunities and exceptions enjoyed by the Crown and denied to others. In a federal system, which need not be a monarchical system, more is involved. What is of present importance is that, save perhaps for the exceptional case where the Parliament creates an entity so practically identified with a department of State of the Commonwealth “as to be indistinguishable”, the Cigamatic doctrine has no application to legal rights which are the immediate product of federal statute and so protected by s 109 of the Constitution.
[7] (1997) 190 CLR 410.
[8] Re Residential Tenancies Tribunal (NSW) and Henderson; Ex parte Defence Housing Authority (1997) 190 CLR 410 at 469-470 per Gummow J discussing The Commonwealth v Cigamatic Pty Ltd (In Liquidation) (1962) 108 CLR 372 at 378 per Dixon CJ.
The important point made in that passage for present purposes is that juristic entities created by the Parliament which are not so exceptional as to attract the protection of the Cigamatic doctrine may nonetheless fall within the term the Commonwealth. Gummow J then proceeded to consider the use in Australia of statutory corporations to exercise, what otherwise, might have been considered to be governmental functions, or an extension thereof, into commercial activity. Gummow J observed that such corporations were in widespread use in the colonies before federation and, before and after, the public service was placed on its modern statutory footing.
The use of statutory corporations was an alternative instrument of government in the period of transition from administration by independent holders of public offices to the modern, hierarchically controlled public service.
The various reasons for creating corporations were extensively researched by Mr Finn before his judicial appointment.[9] The objectives of the colonies in establishing those corporations varied from the avoidance of direct interference by the executive, to affording third-parties rights in contract and tort which were not available in actions against the Crown. In some instances the governing bodies of those corporations benefited from the inclusion of persons drawn from outside the public service. In Residential Tenancies, Gummow J observed that, by reference, in particular, to the position of colonial railways that in Australia there was widespread use of statutory corporations ‘to conduct what in other hands could have been seen as no more than ordinary commercial transaction’ in order ‘to assist rather than to detract from the position of those dealing with such bodies’.[10]
[9] Finn P, Law and Government in Colonial Australia, Oxford University Press, Melbourne 1978 at p 58. In colonial Queensland there were over forty such statutes: Finn, ‘Myths of Australian Public Administration’ in J Power (ed), Public Administration in Australia: A Watershed, Hales and Iremonger, Sydney, 1990, at p 50.
[10] Re Residential Tenancies Tribunal (NSW) and Henderson; Ex parte Defence Housing Authority (1997) 190 CLR 410 at 471.
In SGH Limited v The Commissioner of Taxation[11] (SGH Limited) Gummow J referred to s 102 of the Constitution which refers to any preference or discrimination as to railways ‘by any State or by any authority constituted under a State’.
[11] (2002) 210 CLR 51 at 81, [59].
It follows therefore that to ensure a jurisdiction ample enough to comprehend the controversies between the political integers of the federation, and between natural persons and the instrumentalities through which those entities governed, it is necessary to broadly construe the term the Commonwealth in s 75 of the Constitution.
The same is true for the purposes of s 114 of the Constitution. If the mutual immunity from taxation conferred by that section did not extend to the corporate entities through which the Commonwealth and States govern, then the forms of administration available to them would be significantly constrained.
In SGH Limited[12] Gummow J observed that s 114 of the Constitution was held, as early as 1904, to prohibit the levying of rates on Commonwealth land by a municipal council.[13] In Municipal Council of Sydney v The Commonwealth[14] municipal councils were regarded as instrumentalities of the States which as ‘repository[ies] of the whole executive and legislative powers of the community’ may create subordinate bodies to exercise those powers.[15]
[12] (2002) 210 CLR 51 at 88, [81].
[13] Municipal Council of Sydney v The Commonwealth (1904) 1 CLR 208.
[14] (1904) 1 CLR 208.
[15] Municipal Council of Sydney v The Commonwealth (1904) 1 CLR 208 per O’Connor J at 240; see also Griffith CJ at 230.
The reverse is the position with respect to the common law presumption of governmental immunity from the operation of statute. Indeed, as has been observed, the very purpose of the early use of corporations was to facilitate proceedings against the Crown.[16] South Australia accepts that whether or not ARTC is the Commonwealth for the purposes of s 52(i) of the Constitution is not answered by determining whether it is entitled to the privileges or immunities of the Crown, which, in this case, it is plainly not.
[16] NT Power Generation Pty Ltd v Power and Water Authority & Anor (2004) 219 CLR 90 at 151-152, [67]-[68] per McHugh A-CJ, Gummow, Callinan and Heydon JJ.

In the Commonwealth of Australia v Bogle[17] the High Court considered whether Commonwealth Hostels Ltd, a company incorporated under the Companies Act 1938 (Vic), was entitled to immunity from the operation of State rent control laws. The High Court held that it was not an agent or instrumentality of the Crown and entitled to its immunities. Fullagar J held:[18]
Here we have simply a company formed in the ordinary way under the Companies Act of the State, and functioning as such within the legal system of the State. On its face the Prices Regulation Act obviously applies to every such company which supplies board and lodging for reward, and there is no other statute to construe. It sues in its own right as a party to a contract a person who has contracted with it. The contract alleged is one which is made illegal by the State Act. What reason can there be for saying that the statute is inapplicable? The company is not the Crown in right of the Commonwealth. It has no right to sue on behalf of the Crown in right of the Commonwealth. It seems to me sufficient to paraphrase what I said in Rural Bank of New South Wales v Haynes, and to say that the Act does not affect rights of the Commonwealth, but the rights asserted by the company in these proceedings are simply not rights of the Commonwealth. It is said that the company was formed at the instance of the Commonwealth, that the Commonwealth through the Minister is in a position under the articles to control the company, and that the ultimate financial interest is that of the Commonwealth. But none of these things can affect the legal character of the company as a person suing in the courts. If the company were a company limited by shares, it could make no difference that the Commonwealth held ninety-nine per cent of the shares. It is said (with perhaps more force) that the company in possession and control of property of the Commonwealth, and that its activities are activities in which the Commonwealth, in the course of the exercise of the immigration power, is vitally interested. But again I am unable to regard these matters as affecting in any way the legal nature of the company. Having been incorporated under the Companies Acts of the State, it seems to me that it must be subject to the Companies Acts and all other State legislation which in terms applies to such companies. It may be that the Commonwealth Parliament could, under s 51(xxvii) and (xxxix) of the Constitution, enact legislation conferring immunities on the company and prevailing over State legislation by virtue of s 109. But no such question need be considered, because no such legislation has been enacted.
(citations omitted)
[17] (1953) 89 CLR 229.
[18] Commonwealth of Australia v Bogle (1953) 89 CLR 229 at 267.
Returning to s 52 of the Constitution, there is no reason on the face of that section to give the term ‘the Commonwealth’ any narrower meaning than it is given in ss 75 and 114 of the Constitution.
It is not obvious what additional advantage the conferral of exclusive legislative power had, over and above the effect of s 109 of the Constitution, with respect to the subject matters there enumerated.[19] It may be that there was a narrower conception of inconsistency at the time of federation. In their commentary on s 109 of the Constitution Quick and Garran record:[20]
It has been held in the United States that the cases in which federal legislation will supersede the legislation of a State are those in which the same matter is the subject of legislation by both ... when a State statute and a Federal statute operate upon the same subject matter, and prescribe different rules concerning it, the Federal statute is one within the power of the Federal Parliament, the State statute must give way.
(citations omitted and emphasis added)
[19] Cf The Queen v Phillips (1970) 125 CLR 93 at 101 per Barwick CJ.
[20] Quick J and Garran R, The Annotated Constitution of the Australian Commonwealth, 1st ed reprinted, Lexis Nexis, Sydney, 2002 at p 939.
It was only in 1926 in Clyde Engineering Co Ltd v Cowburn[21] that the covering the field test was clearly articulated.
[21] (1926) 37 CLR 466.
Alternatively, it may be that together with s 108 of the Constitution it was intended to freeze State law continued by that section with respect to matters within the exclusive jurisdiction of the Commonwealth.[22]
[22] The Queen v Phillips (1970) 125 CLR 93 at 117-119 per Windeyer J.
The reasons for freezing State laws and denying the operation of any subsequent statutes made with respect to Commonwealth departments, and other matters entrusted exclusively to the Commonwealth by s 52 of the Constitution are plain enough. They are matters related to the narrow conception of executive government. However, that narrow conception need not be applied to the capacities in which the Commonwealth might acquire places. The term ‘the Commonwealth’ may be given a wider construction to cover land held by statutory corporations.
Section 64 of the Constitution provides that the Governor-General may appoint officers (Ministers) to administer the departments of State of the Commonwealth. Those officers are to hold office during the pleasure of the Governor-General and are members of the Federal Executive Council. Accordingly, the degree of ministerial control over the juristic entity that has title to the property, as well as the degree of direct control over the property, are important considerations in determining whether a place has been acquired by the Commonwealth.
The critical question is the extent to which the executive government of the Commonwealth, meaning the Governor in Council, the Minister appointed pursuant to s 64 of the Constitution and the public servants under his or her hierarchical control, can directly or indirectly control the exercise of proprietary rights, powers and interests over and in the place. Those rights include the right to use, or direct the use, of the place or to dispose, and enjoy the proceeds, of the property.
For the reasons given by Stanley J, the Commonwealth’s Ministers effectively controlled the exercise of proprietary rights and interests in land held by the ARTC through:
·the powers of appointment and removal of its directors;
·the power of removal of the ARTC’s chief executive officer; and
·the power to set the parameters for the general policies of the ARTC.
In exercising those powers the Ministers were accountable to Parliament for their conduct and control of the ARTC. The ARTC is therefore the Commonwealth for the purposes of s 52 of the Constitution.
STANLEY J: On 9 September 2016, pursuant to 6SCR 211, I referred to the Full Court certain questions to be heard and determined separately ahead of all other issues in the action. The matter proceeded on the basis of a statement of agreed facts.[23] At issue is whether the defendant is liable to pay training levies exacted by the plaintiff, pursuant to legislation enacted by the Parliament of South Australia. The answer to this question turns on whether land on which the defendant was undertaking building and construction work is a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution. The land on which the construction work was undertaken is, and was at the time of the work, owned by the Australian Rail Track Corporation Ltd (ACN 081 455 754) (ARTC), a wholly Commonwealth owned company incorporated pursuant to the Corporations Act 2001 (Cth).
[23] Amended statement of agreed facts, affidavit of Christopher Guy Wellington, exhibit CGW6.
The plaintiff
The Construction Industry Training Board (“the Board”) is a body corporate that continues in existence by s 4 of the Construction Industry Training Fund Act 1993 (SA) (“Construction Industry Act”).
Pursuant to s 12 of the Construction Industry Act, the Board has all the powers of a natural person.
The Board was established by the Construction Industry Act to enforce a mandatory training levy of 0.25 per cent on the value of building and construction work undertaken in South Australia.
The levy is imposed in respect of building or construction work undertaken in South Australia which has commenced after 1 September 1993 and is to be paid by a project owner prior to the commencement of the building and construction work.
The funds received by the Board are then invested and applied for the purpose of promoting increased productivity, career opportunities, personal satisfaction and occupational health and safety within the building and construction industry through training.
The defendant
Transfield Services (Australia) Pty Ltd (“Transfield”) is a proprietary company limited by shares.
Transfield is a provider of operations, maintenance and construction services to the resources, energy, industrial, infrastructure, property and defence sectors in Australia.
On 22 July 2004, Transfield entered into an agreement with the ARTC whereby Transfield was engaged to carry out building and construction work associated with two national railway projects.
The first project was the “National Stimulus Project” between 2009 and 2012 which:[24]
a.consisted primarily of extensions to existing crossing loops throughout the ARTC network, the construction of a number of new crossing loops and associated alterations to improve rail tracks;
b. was undertaken from Kalgoorlie in Western Australia through to Broken Hill in New South Wales and Wolseley on the South Australian and Victorian border; and
c. was later extended to include tracks from Broken Hill to Parkes and from Parkes to Cootamundra in New South Wales.
[24] Para 40, amended statement of agreed facts, affidavit of Christopher Guy Wellington, exhibit CGW6; Para 11, statement of claim.
The second project was the “National Productivity Works Project” between late 2010 and late 2012 which consisted primarily of re-railing, re-sleepering and associated track upgrading works undertaken from Whyalla in South Australia through to Broken Hill in New South Wales, Cootamundra to Parkes in New South Wales and Parkes to Broken Hill.
The Board claims that both projects satisfy ss 3 and 24(1) of the Construction Industry Act which therefore attracts payment of the imposed levy. The Board further submits that additional penalty interest is now payable as a result of Transfield’s non-compliance.
Transfield denies that it is liable to pay any amount claimed by the Board because it contends that all the rail network land on which the work was carried out was a place, “acquired by the Commonwealth for public purposes” within the meaning of s 52(i) of the Commonwealth Constitution.
The Board asserts that the ARTC is a Corporations Act company intended to operate in a commercial manner, with no legislative intervention to modify that character. Therefore, the Board’s position is that the land held by the ARTC does not fall within the description of s 52(i) of the Commonwealth Constitution.
Intervener
The Attorney-General of the Commonwealth has intervened pursuant to s 78A of the Judiciary Act 1903 (Cth) in support of Transfield’s position.
The specific questions for determination by this Court
Did the land within South Australia held by the ARTC that constituted the ARTC’s rail network, constitute a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution between 2009 and 2013?
If the answer to the above question is “No”, which, if any, of the following categories of land within South Australia held by the ARTC that constituted the ARTC’s rail network, constituted a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Commonwealth Constitution between 2009 and 2013?
a.Land acquired by the ARTC from the Australian National Railways Commission pursuant to the declarations under s 67AE(1)(a) of the Australian National Railways Commission Act 1983 (Cth) referred to at paragraphs 14 and 15 of the amended statement of agreed facts.
b.Land acquired by the ARTC from other parties subsequent to 1 July 1998.
The history of the Australian Rail Track Corporation
The operation of railways, the ownership of land on which rail infrastructure has been built and the control of access to that infrastructure have a long history as governmental activities in Australia.[25]
[25] The Federated Amalgamated Government Railway and Tramway Service Association v The New South Wales Railway Traffic Employees’ Association (1906) 4 CLR 488 at 539, Crouch v Commissioner for Railways(Qld) & Anor (1985) 159 CLR 22 at 38.
The Commonwealth Railways Commissioner was established by s 5(1) of the Commonwealth Railways Act 1917 (Cth), which states:
There shall be a Commissioner, who shall be a body corporate by the name of the Commonwealth Railways Commissioner, and shall have perpetual succession and a common seal, and be capable of suing and being sued, and shall, subject to this Act have power of acquire, purchase, sell, lease, and hold lands, tenements, and hereditaments, goods, chattels and any other property for the purposes of and subject to this Act.
Between 1917 and 30 June 1975, the Commonwealth Railways Commissioner operated a railway service for the Commonwealth.
On 21 May 1975 an agreement was made between the Commonwealth of Australia and the State of South Australia whereby, subject to the necessary legislation being enacted and entered into force, any land of the State of South Australia used exclusively for non-metropolitan railways, as well as certain other land, was to be acquired and vested in the Australian National Railways Commission (ANRC). The ANRC was to be established by the Commonwealth Parliament upon the relevant legislation being enacted (“the initial Rail Transfer Agreement”).
Accordingly, on 1 July 1975, the Australian National Railways Act 1975 (Cth) was enacted by the Commonwealth Parliament which established the ANRC. The effect of s 1(3) of the Australian National Railways Act 1975 (Cth) was to rename the Commonwealth Railways Act 1917 (Cth) the Australian National Railways Act 1917 (Cth).
Section 7 of the Australian National Railways Act 1975 (Cth) inserted a new s 16A into the Australian National Railways Act 1917 (Cth), which stated:
16A. All the rights, property and assets, including moneys, that, immediately before the commencement of the ‘Australian National Railways Act’ 1975, were vested in the Commonwealth Railways Commissioner are, by force of this section, vested in the Commission.
In addition to the above, s 16 of the Australian National Railway Act 1917 (Cth), was also amended:[26]
16.For the purposes of this Act there shall be vested absolutely in the Commission, and, in respect of land, for an estate in fee simple-
(a)     all railways and all rolling-stock heretofore constructed or acquired by or on behalf of Australia either before or after the commencement of the Australian National Railway Act 1975;
(b)     all wharves, stations, yards and buildings connected, or used in connexion, with such railways;
(c)     all land the property of Australia over or upon which such wharves, stations, yards and buildings have been constructed or erected;
(d)     all land acquired for or on behalf of Australia for railway purposes; and
(e)     all wires, instruments and other telegraphic or telephonic apparatus (not being the property of the Australian Telecommunications Commission) used in connexion with the railways.
[26] Australian National Railways Act 1975 (Cth), s 8.
The ANRC was empowered to appoint officers and engage employees, on terms approved by the Public Service Board.[27] It was empowered to contract, in writing, “for any other matter or thing whatsoever necessary for enabling it to carry the purposes of the Act into full effect”.[28] The power of the ANRC was limited by a requirement to obtain the approval of the Minister for contracts under which the ANRC was to pay an amount exceeding $100,000 or such higher amount as might be prescribed.[29] The ANRC was required to provide the Minister with an annual statement showing the details of contracts entered into by the ANRC, and quarterly and annual reports, and other reports as required by the Minister.[30] The Minister was empowered to direct the ANRC to make any alterations in any existing practice or carry out any system or matter of policy.[31]
[27] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 46.
[28] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 22.
[29] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 23.
[30] Australian National Railways Act 1917 (Cth) (as amended after 1975), ss 25, 40, 41 and 42.
[31] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 44.
The ANRC consisted of a full-time Chairman and six part-time Commissioners,[32] each appointed by the Governor-General[33] for a period of up to five years (and eligible for reappointment).[34] The Minister was empowered to appoint a person to act as Chairman or as a Commissioner. Their remuneration was to be determined by the Remuneration Tribunal under the Remuneration Tribunals Act 1973-1974 (Cth).[35] The appointments of the Chairman and the Commissioners could be terminated by the Governor-General for misbehaviour, inefficiency or physical or mental incapacity.[36] Section 13(2) defined the circumstances where the Governor-General was required to terminate the appointment of a Commissioner.[37]
[32] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 7.
[33] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 7(2).
[34] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 8(1).
[35] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 9.
[36] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 13(1).
[37] Australian National Railways Act 1917 (Cth) (as amended after 1975), s 13(2).
In accordance with the terms of the initial Rail Transfer Agreement, the Parliament of South Australia passed the Railways (Transfer Agreement) Act 1975 (SA) which came into force on 30 October 1975. Section 4 of that Act approved the initial Rail Transfer Agreement that had been entered into by the Commonwealth of Australia and the State of South Australia.
On 7 October 1975, the Railways Agreement (South Australia) Act 1975 (Cth) received Royal Assent. Section 5 of that Act approved the initial Rail Transfer Agreement.
As a result, between 1975 and 1998, the ANRC took over the operation of all Commonwealth and non-metropolitan railway lines of the South Australian Government in South Australia.
On 30 June 1997, the Commonwealth and the State of South Australia entered into the 1997 Railways Agreement by which the Commonwealth agreed to vest in the State certain land then held by the ANRC. The recitals of that agreement indicated that the Commonwealth proposed to divide up the functions of the ANRC, so that the track ownership and management functions in relation to the interstate rail network land remained with the ANRC while passenger and freight services then operated by the ANRC would be operated by other entities.
On 14 November 1997 the Commonwealth and each of the mainland States entered into an intergovernmental agreement (the intergovernmental agreement) whereby, pursuant to clause 4.1 of that agreement, the Commonwealth agreed to establish and own a company under the Corporations Law called the ARTC.
Clause 5.1 of the intergovernmental agreement provided that the aims of the ARTC were:
to provide efficient and seamless access to the interstate rail network through:
(a)operating the business on commercially sound principles;
(b)pursuing a growth strategy for interstate rail;
(c)improving interstate rail infrastructure through better asset management and a program of commercial and grant funded investment; and
(d)promoting operational efficiency and uniformity on the interstate network.

Clause 15.5 provided that the company and its contracts would be subject to the laws of the Commonwealth, State, Territory and local governments. This provision makes clear that the ARTC did not enjoy the shield of the Crown.
The ARTC was incorporated under the Corporations Law on 24 February 1998, and is now taken to be registered under the Corporations Act 2001 (Cth).
The issued share capital for the ARTC is and has at all times since its establishment been held beneficially by the Commonwealth.
At the time of its establishment, the issued share capital of the ARTC was held as follows:[38]
-    40 shares were held by Mark Vaile, then Minister of State for Transport and Regional Development of the Commonwealth;
-    40 shares were held by John Fahey, then Minister of State for Finance and Administration of the Commonwealth;
-    5 shares were held by Dr Peter Boxall, then Secretary, Department of Finance and Administration;
-    5 shares were held by Leonard Early, then Deputy Secretary, Department of Finance and Administration;
-    5 shares were held by Bruce Gemmell, then First Assistant Secretary, Land Transport, Department of Transport and Regional Development; and
-    5 shares were held by Robyn Beetham, then Assistant Secretary, Rail, Department of Transport and Regional Development.
[38] mended statement of agreed facts, affidavit of Christopher Guy Wellington, exhibit CGW6.
Pursuant to its Articles of Association[39] at article 3, shares or options over shares in the ARTC could not be issued without the joint consent of the Minister of the Commonwealth responsible for rail transport and the Minister for Finance and Administration. Whilst the Commonwealth was, or is, legally or beneficially entitled to all of the issued shares in the company, the directors must refuse to register any transfer of shares to any transferee other than the Minister responsible for rail transport or to the Minister for Finance unless that transferee was approved by both relevant ministers.[40]
[39] Articles of Association of Australian Rail Track Corporation Limited, executed 25 February 1998.
[40] Article 33(2)(b), Articles of Association of Australian Rail Track Corporation Limited, executed 25 February 1998.
On 11 September 2000, the Commonwealth called in the shares held beneficially on trust by Mr Vaile, Mr Gemmell, Ms Beetham, Dr Boxall and Mr Early such that following the transfers of shares on the same date, the whole of the shareholding of the ARTC was:
- 50 shares held by John Anderson as Minster of State for Transport and Regional Services of the Commonwealth; and
- 50 shares held by John Fahey as Minster of State for Finance and Administration of the Commonwealth.
In 2002, Mr Fahey transferred his entire shareholding in the ARTC to the Commonwealth.
In or about 2004, Mr Anderson transferred his entire shareholding in the ARTC to the Commonwealth. At all times since this transfer, the Commonwealth has been the sole shareholder of the ARTC.
By a declaration made on 29 June 1998 by John Fahey, the Minister of State for Finance and Administration of the Commonwealth, pursuant to s 67AE(1)(a) of the Australian National Railways Commission Act 1983 (Cth), assets which included the Australian National Railways Commission Rail Land, liabilities and contractual rights and obligations described in the declaration made on 29 June 1998, vested in the ARTC on 1 July 1998.
By a further declaration made on 8 December 1998 by Stephen Bartos, a delegate of the Minister of State for Finance and Administration of the Commonwealth, further assets and contractual rights and obligations of the ARTC described in the declaration vested in the ARTC on 8 December 1998.
On 21 September 1999, John Anderson, the Minister for Transport and Regional Services of the Commonwealth, nominated the ARTC as the nominee of the Commonwealth for the purposes of clauses 5.5 to 5.9 inclusive and clauses 10A.1 to 10A.7 of the 1997 Railways Agreement, as amended by the First Amending Agreement.
Prior to 1 July 2012, the ARTC was governed by a Memorandum and Articles of Association executed 25 February 1998. On 15 November 2000, the ARTC resolved to amend article 60(3) of the Articles of Association executed 25 February 1998.
From 1 July 2012, the ARTC adopted its present constitution.
The directors of the ARTC are and have been, from time to time, appointed by the Minister for Transport and Regional Development (and successor Ministers in the Transport portfolio) and the Minister for Finance and Administration (and successor Ministers in the Finance portfolio).
The issue
The issue for the Full Court is whether the ARTC land constituted a place or places acquired by the Commonwealth for public purposes within the meaning of s 52(i) during the relevant period of 2009 to 2013.[41] If it is, the training levies imposed pursuant to the Construction Industry Act are not payable because the Act is beyond power and invalid to the extent that it regulates conduct, activities or things on the ARTC land.
[41] It was agreed between the parties that the actual period that is relevant is 2009 to 2011.
It is convenient to note that there are a number of matters which are undisputed. First, that the rail track land held by the ARTC was acquired for public purposes. Second, that historically the construction, maintenance and operation of railways has served public purposes which is a significant factor in assessing the purposes for which the ARTC land is used. Third, Commonwealth grant funding of the ARTC to maintain and develop an interstate rail network serves public purposes and is the vehicle through which the Commonwealth invests in rail.
This all follows from the historical position that the conduct of railways is a constitutionally recognised Commonwealth purpose and the acquisition of land for that purpose is a proper public purpose of the Commonwealth.[42] Accordingly, there is no issue that if the ARTC is the Commonwealth for the purpose of s 52(i) it acquired the rail track land for public purposes.
[42] Sections 51(xxxiii), 51(xiv), 98, 102 and 104 of the Commonwealth Constitution. See Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219 at 231.
The issue is one of characterisation. Is the ARTC land a place acquired by the Commonwealth? This necessitates consideration of whether the ARTC, being a corporation formed under general companies legislation, by reason of that fact, and features particular to its operation, means it cannot be the Commonwealth for the purposes of the operation of s 52(i).
For this purpose, there is no dispute that while many State laws are picked up and applied in Commonwealth places as Commonwealth laws by the Commonwealth Places (Application of Laws) Act 1970 (Cth) (the Application of Laws Act) and the Commonwealth Places (Mirror Taxes) Act 1998 (Cth) (the Mirror Taxes Act), the Construction Industry Act is not such a State law. This is because the Application of Laws Act does not pick up and apply laws that impose taxation and the Mirror Taxes Act only picks up State taxation laws specified in Schedule 1 of that Act or prescribed by regulations under that Act, and the ‘Construction Industry Act’ is not so specified or prescribed.
Section 52(i) of the Constitution
Section 52(i) of the Constitution provides:
The Parliament shall, subject to this Constitution, have exclusive power to make laws for the peace, order and good government of the Commonwealth with respect to –
(i) the seat of government of the Commonwealth, and all places acquired by the Commonwealth for public purposes;
Section 52(i) confers a broad and exclusive legislative power on the Commonwealth Parliament. The power conferred extends to any act, matter or thing in a Commonwealth place acquired for public purposes upon which the Commonwealth Parliament chooses to legislate. It excludes State legislative power to make laws with respect to a Commonwealth place. A State law will be beyond power and invalid to the extent that it regulates conduct, activities or things within a Commonwealth place.[43]
[43] Allders International Pty Ltd v Commissioner of State Revenue (Vic) (1996) 186 CLR 630 at 639-640, 644, 662 and 676-678.
The nature of the restriction on State legislative power by s 52(i) was explained in Worthing v Rowell & Muston Pty Ltd[44] by Menzies J who said that:[45]
... to the extent to which it grants legislative power to the Parliament, it denies legislative power to the Parliaments of the States. The denial is measured by the grant.
[44] (1970) 123 CLR 89.
[45] (1970) 123 CLR 89 at 113.
In Allders International Pty Ltd v Commission of State Revenue (Vic),[46] Brennan CJ said:[47]
The boundaries of the power withdrawn from the States are charted by the grant of power to the Commonwealth and that grant is to be interpreted with the same generality as the grant of other powers.
[46] (1996) 186 CLR 630.
[47] (1996) 186 CLR 630 at 638.
Section 52(i) operates in respect of a place acquired by the Commonwealth for public purposes for so long as the place remains a Commonwealth place used for public purposes.
In Attorney-General (NSW) & Ors v Stocks & Holdings (Constructors) Pty Ltd,[48] Windeyer J observed[49] that the exclusive power of the Commonwealth with respect to a place it has acquired subsists only so long as it holds the place for the public purpose for which it was acquired.
[48] (1970) 124 CLR 262.
[49] (1970) 124 CLR 262 at 280-281.
In Paliflex Pty Ltd v Chief Commissioner of State Revenue (NSW),[50] Gleeson CJ, McHugh, Gummow, Kirby and Hayne JJ explained that this followed from the use of the word “for” in s 52(i) which is indicative of a continued or continuing end to be attained or object met by the retention by the Commonwealth of the property consequent upon that process of law by which it was acquired. Accordingly, State laws can have no operation while the land remains a place acquired by the Commonwealth for public purposes, but will operate if the land ceases to have the character of such a place.
[50] [2003] HCA 65 at [45], (2003) 219 CLR 325 at 350.
The question whether a corporation formed under general companies legislation is the Commonwealth for the purpose of s 52(i) is broader than whether the corporation is entitled to the privileges or immunities of the Crown. It has been accepted that a corporation can be the Commonwealth for some constitutional purposes, such as s 75(iii) or s 114 of the Constitution and s 64 of the Judiciary Act 1903 (Cth), notwithstanding that it may not be entitled to the privileges and immunities of the Crown.[51] Like s 75(iii) and s 114 of the Constitution, s 52(i) contemplates a wide conception of the Commonwealth that extends beyond the Commonwealth in the strict sense. So much is recognised by the High Court in Deputy Commission of Taxation v State Bank (NSW)[52] where the Court said: [53]
Once it is accepted that the Constitution refers to the Commonwealth and the States as organizations or institutions of government in accordance with the conceptions of ordinary life, it must follow that these references are wide enough to denote a corporation which is an agency or instrumentality of the Commonwealth or a State as the case may be. The activities of government are carried on not only through the departments of government but also through corporations which are agencies or instrumentalities of government. Such activities have, since the nineteenth century, included the supply on commercial terms of certain types of goods and services by government owned and controlled instrumentalities with independent corporate personalities.
[51] Deputy Commissioner of Taxation v State Bank of NSW (1992) 174 CLR 219 at 230-231; State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253 at 282‑283; SGH Limited v Commissioner of Taxation [2002] HCA 18 at [15], (2002) 210 CLR 51 at 67.
[52] (1992) 174 CLR 219 at 230.
[53] (1992) 174 CLR 219 at 230-231.
In Allders International Pty Ltd v Commissioner of State Revenue (Vic),[54] the High Court held that the Tullamarine Airport was a place acquired by the Commonwealth for public purposes within the meaning of s 52(i). The airport was constructed on land which had been acquired by the Commonwealth for that purpose which was statutorily vested in the Federal Airports Corporation (FAC), a statutory corporation empowered to hold the land vested in it “for and on behalf of the Commonwealth”.[55] The issue was whether by the grant of a lease over premises within the airport, for the purpose of operating a duty-free shop the land lost that character. The majority held it did not because the lease was for a purpose identical to the original acquisition. Underpinning the reasoning of the majority is the proposition that the land held by the FAC is a Commonwealth place within the meaning of s 52(i).
[54] (1996) 186 CLR 630.
[55] Federal Airports Corporation Act 1986 (Cth) ss 28(1) and 29(1).
Authorities concerned with other provisions of the Constitution also support the proposition that the Commonwealth can acquire real property through the instrument or vehicle of a general law company. However, no useful purpose is served by applying a distinction between corporations established under general companies law and corporations established by special or particular laws. That would be to elevate matters of form over substance.[56]
[56] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [63], (2002) 210 CLR 51 at 83.
In SGH Limited v Commissioner of Taxation,[57] the High Court had to decide whether a building society formed under general building societies legislation was the State for the purposes of s 114 of the Constitution which prohibits the imposition of tax on property belonging to a State. The Court held that it is possible for a corporation formed under general building societies legislation to be “the State”, although in that case SGH was found not to be the State because control of the corporation was shared between the State and depositors.
[57] [2002] HCA 18, (2002) 210 CLR 51.
In NT Power Generation Pty Ltd v Power and Water Authority & Anor[58] the High Court had to consider whether Gasgo Pty Ltd, a company in which the Power and Water Authority (PAWA) (a body corporate constituted under a statute of the Northern Territory Parliament) beneficially owned all the shares, was “an emanation of the Crown in the right of the Northern Territory”. The Court held it was not. Critical to that conclusion was the consideration that there was nothing to indicate that its directors were under any duty to obey directions from PAWA or the Northern Territory government.[59]
[58] (2004) 219 CLR 90.
[59] (2004) 219 CLR 90 at 150.
In Queanbeyan City Council v ACTEW Corporation Ltd & Anor,[60] the High Court had to decide whether water licence fees and a utilities network tax imposed by the government of the ACT on its water authority, ACTEW, were excise duties. ACTEW was a Territory-owned corporation that was wholly owned by the Australian Capital Territory and was subject to the obligations imposed by the Territory-owned Corporations Act 1990 (ACT). The Court held that the provisions of the Territory-owned Corporations Act indicated that the ACT government exercised extensive control over the conduct of the affairs of ACTEW. The Court reasoned that ACTEW was so closely identified with “the Territory”, having regard to the “extensive control exercised by the Territory executive, and in particular by the Chief Minister” over the conduct of its affairs, that it was not distinct from the Territory government.[61]
[60] [2011] HCA 40, (2011) 244 CLR 530.
[61] [2011] HCA 40 at [37], (2011) 244 CLR 530 at 546.
As was recognised in Inglis & Anor v Commonwealth Trading Bank of Australia,[62] by Barwick CJ,[63] the Commonwealth may lawfully clothe itself in a number of forms. In that case, the Commonwealth Trading Bank, a statutory corporation created by the Commonwealth Banks Act 1959 (Cth), was found to be the emanation by which the Commonwealth operated in the field of general banking.
[62] (1969) 119 CLR 334.
[63] (1969) 119 CLR 334 at 335.
Given that the Commonwealth or a State, for constitutional purposes, can encompass a corporation through which the Commonwealth or the State carries out its governmental functions,[64] it is necessary to identify the principles and criteria by reference to which it can be determined whether or not a particular corporation is the Commonwealth or the State for constitutional purposes, and in particular for the purposes of s 52(i).
[64] Deputy Commissioner of Taxation v State Bank of NSW (1992) 174 CLR 219 at 233.
In SGH Ltd v Commissioner of Taxation,[65] Gleeson CJ, Gaudron, McHugh and Hayne JJ addressed this question in the context of s 114 of the Constitution. The issue was whether SGH was the State for the purposes of that provision. They said:[66]
In considering whether an entity, in whose name property said to belong to a State is held, falls within the description “the State” in s 114, it is, no doubt, relevant to consider the activities undertaken by that entity. Similarly, it will be relevant, and usually very important, to identify the legal relationship between the entity and the executive government of the State and to identify what rights or powers the executive government of the State has over the use and disposal of the property in question. Not only will those inquiries be necessary for the purpose of deciding whether the property belongs to “the State”, they will also bear upon whether the entity in whose name the property stands is properly regarded as the State. Adopting what was said in the State Bank Case: “[t]he question then is whether [in this case, SGH] is discharging governmental functions for the State or, to put it another way, is the State carrying on [the relevant business] through its statutory corporation.”
[footnote omitted.]
[65] [2002] HCA 18, (2002) 210 CLR 51.
[66] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [16], (2002) 210 CLR 51 at 67-68.
They said that whether a corporation formed under general building societies legislation is the State of Queensland requires demonstration of more than government policy favouring or facilitating the creation of the entity in pursuit of some aspect of the public interest. It requires consideration of the circumstances and purposes of the entity’s creation, but it also requires consideration of every feature of the entity which bears upon its relationship with the polity.[67] As they explained, that is why cases about s 114 of the Constitution are focussed upon the ownership and management of the entity and the purposes the entity was required to pursue. They said it is those features which will most often reveal the relationship the entity has with the State and if it is revealed by examination of them that the entity is wholly owned and controlled by the State concerned, and must act solely in the interests of the State, the conclusion that it is the State, or an emanation of the State, would readily follow.[68]
[67] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [22], (2002) 210 CLR 51 at 70.
[68] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [22], (2002) 210 CLR 51 at 70.
Gummow J said the State cannot be carrying on the activities of government through the medium of the entity as its agent or instrument if the State did not control the conduct of the affairs of the entity.[69]
[69] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [65], (2002) 210 CLR 51 at 84.
Kirby J characterised the decisive question to be whether the instrumentality, with its history, purposes, manner of organisation, governance, functions and systems of control represents an instrument or agency by which the Commonwealth is to operate in a particular field through a corporation created for the purpose. This is to be contrasted with a corporation created with some connections with the Commonwealth, but with a purpose that it should perform its functions independently of the polity, that is to say otherwise than as a Commonwealth instrument, so that the concept of a Commonwealth activity cannot realistically be applied to that which the corporation does.[70]
[70] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [96], (2002) 210 CLR 51 at 94-95.

Callinan J accepted that whether a corporation created under the general law may be characterised as the State for constitutional purposes is to be determined by examining the particular characteristics of the corporation in question in order to discern the degree and extent of governmental purpose, participation, and benefit in and from the corporation and its activities.[71] He said[72] in a passage subsequently approved by the plurality in Queanbeyan City Council v ACTEW:[73]
In the past, this Court has tended to look for six particular aspects or attributes of a relevant corporation with a view to discerning the true character of the corporation in question for the purposes of s 114 of the Constitution. The parties are agreed that such an exercise is appropriate here, although they differ as to the importance to be attached to the presence or absence of various of these aspects or attributes. The matters that have tended to influence the Court in the past are these: the absence or otherwise of corporators; an explicit obligation of the corporation to conduct its affairs to the greatest advantage of the relevant polity; the participation of the executive government in the process of formulating policy and making decisions; the right or otherwise of the government to appoint directors, and the source of, and responsibility for their remuneration; the destination of profits; and, the obligation or otherwise of the Auditor-General to audit the accounts of the corporation.
[footnote omitted.]
[71] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [127], (2002) 210 CLR 51 at 102.
[72] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [131], (2002) 210 CLR 51 at 103.
[73] [2011] HCA 40 at [30], (2011) 244 CLR 530 at 545.
Callinan J cited with approval a passage from the reasoning in Inglis v Commonwealth Trading Bank of Australia,[74] where Kitto J said:[75]
The decisive question is not whether the activities and functions with which the respondent is endowed are traditionally governmental in character, though their possession of a traditional or generally accepted governmental character may well help in the ascertainment of the legislative intention. The question is rather what intention appears from the provisions relating to the respondent in the relevant statute: is it, on the one hand, an intention that the Commonwealth shall operate in a particular field through a corporation created for the purpose; or is it, on the other hand, an intention to put into the field a corporation to perform its functions independently of the Commonwealth, that is to say otherwise than as a Commonwealth instrument, so that the concept of a Commonwealth activity cannot realistically be applied to that which the corporation does?
[74] (1969) 119 CLR 334.
[75] (1969) 119 CLR 334 at 337-338.
The analytical approach adopted in Inglis is directed towards identifying the purpose for which the entity was formed, having regard to all the relevant circumstances. The same approach applies to determining whether the entity is the Commonwealth or an emanation of the Commonwealth. The test is multifactorial[76] depending on a range of factors of which governmental control is one of the most significant. Those factors include the nature of the functions performed by the corporation, whether the activities of those of the Commonwealth are carried out through the corporation, the level of Commonwealth oversight and scrutiny, both in reporting requirements and auditing by the Auditor-General and, importantly, the degree of governmental control over the corporation, including in relation to the appointment and removal of directors and influence over policy and decision-making. But the list of relevant indicia is not closed.[77] The underlying consideration is whether the entity exhibits features such that the Commonwealth can be said to be operating in a particular field through the corporate entity.
[76] Superannuation Fund Investment Trust v Commissioner of Stamps (SA) (1979) 145 CLR 330 at 349.
[77] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [96], (2002) 210 CLR 51 at 94.
This approach was applied in State Bank of NSW v Commonwealth Savings Bank of Australia,[78] where the Court observed in respect of the State Bank that the legislative intention was to be found in the legislation establishing the State Bank. The Court recognised that the constitutional conception of the Commonwealth did not require the corporation to be tied narrowly to the executive government. While the Court held that the question of control was of central importance,[79] the absence of a general power to remove a director without cause and the relative lack of control compared with that exercisable by the Commonwealth executive that existed in Inglis, did not prevent the Court finding the State Bank was an emanation of the State of New South Wales.[80]
[78] (1986) 161 CLR 639 at 644-648.
[79] (1986) 161 CLR 639 at 648.
[80] (1986) 161 CLR 639 at 652.
While SGH Ltd v Commissioner of Taxation was concerned with the meaning of the Commonwealth in s 114 of the Constitution there is no sound reason in principle to afford it a different meaning in that section from the meaning to be attributed to the same expression in s 52(i). While the meaning of an expression is to be found in its context, the principle that an expression repeatedly used in an instrument generally should be given a consistent meaning has been applied to the expression “the Commonwealth” when used in the Constitution.[81]
[81] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [13], (2002) 210 CLR 51 at 66 – 67; Bank of New South Wales & Ors v Commonwealth & Ors (1948) 76 CLR 1 at 363.
The Board submits that for Transfield to establish that the ARTC land is a place acquired by the Commonwealth it must overcome the barrier presented by the ARTC’s separate corporate personality as a Corporations Act company. It submits that the nature of its separate corporate personality erects a barrier to the ARTC being so closely identified with the Commonwealth that, in its title to the land, it may be said to hold the land in identity with the Commonwealth. This focuses on questions of control, purpose and function. Are those matters of such a nature as to overcome this barrier? It submits that this is not strictly a question of whether the ARTC is the Commonwealth. In this context the Board emphasises the matter of the lack of operational control of the ARTC by the Commonwealth. The Board emphasises the commercial and competitive functions of the ARTC which it says contraindicates the identification of the ARTC with the executive government of the Commonwealth.
I do not accept this submission.
The proposition that the status of the ARTC as a company incorporated under the general corporations law presents a barrier to a finding that the ARTC shares an identity with the Commonwealth for the purposes of its ownership of the rail track land is contrary to the approach taken by Gummow J in SGH Ltd v Commissioner of Taxation that to draw a distinction between a general and a special law corporation is a needless complication elevating form over substance.[82]
[82] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [63], (2002) 210 CLR 51 at 83.
In any event, while it is the case that in Queanbeyan City Council v ACTEW Corporation Ltd,[83] the reasons of the joint judgment of French CJ, Gummow, Hayne, Crennan, Kiefel and Bell JJ referred to the extensive control exercised by the Territory executive over the conduct of the affairs of ACTEW, such as to closely identify it with the Territory, the submission that for the ARTC land to have been acquired by the Commonwealth there must be an identity between the ARTC and the Commonwealth places too much emphasis on the one occasion on which the High Court has referred to the concept of “identity” in the context of s 52(i). The authorities establish that where the joint reasons in Queanbeyan v ACTEW[84] refers to “identity”, the court is concerned with whether the corporation is an agency or instrumentality of the Commonwealth through which the activities of government are carried on. So much is apparent from the reference in the joint reasons to the judgment in Deputy Commissioner of Taxation v State Bank (NSW)[85] which recognises that the Commonwealth, and for that matter the States, carry on the activities of government not only through government departments but also through corporations. Such activities include the supply on commercial terms for certain goods and services by government-owned and controlled instrumentalities with independent personalities. As the judges of the High Court acknowledged, railways are a notable example of such an activity.[86]
[83] [2011] HCA 40 at [37], (2011) 244 CLR 530 at 546.
[84] [2011] HCA 40 at [37], (2011) 244 CLR 530 at 546.
[85] (1992) 174 CLR 219 at 230 – 231.
[86] Deputy Commissioner of Taxation v State Bank (NSW) (1992) 174 CLR 219 at 231.
Incorporation of a wholly-owned Commonwealth company under a general law does not prevent it from carrying out its activities in pursuance of governmental objectives or, to put it another way, it does not prevent the Commonwealth from acting through that corporation. What is determinative is not how the company was incorporated but, rather, the degree of governmental control that may be exercised by reference to the corporation’s constitution and the broader governance framework within which it operates. In SGH Ltd v Commissioner of Taxation, Gleeson CJ, Gaudron, McHugh and Hayne JJ observed that reference to “the Commonwealth” or “a State” are not to be construed narrowly. They said that in determining whether “an entity” falls within the description of “the State” it is important to “identify the legal relationship between the entity and the executive government”.[87] Whether an entity falls within the description of “the State” is to be determined by whether the corporation “is discharging governmental functions for the State or, to put it another way, is the State carrying on [the relevant business] through its statutory corporation”.[88] While this analysis is focussed on s 114 of the Constitution, I consider that it is equally application to s 52(i).
[87] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [13]-[16], (2002) 210 CLR 51 at 66-68.
[88] SGH Limited v Commissioner of Taxation [2002] HCA 18 at [14]-[16], (2002) 210 CLR 51 at 67-68.
In Queanbeyan v ACTEW, the corporation, wholly owned by the Territory government, was held to constitute the “Territory”. The High Court’s reasons demonstrate that, in order to assess the degree of control exercised by the government over the operations of the corporation, an analysis is required of the objects of the company, the nature of the shareholding of the company, the manner in which the company is to be audited, and the financial relationship between the entity and the government, such as in relation to borrowings or the payments of dividends.[89]
[89] Queanbeyan v ACTEW [2011] HCA 40 at [31]-[37], (2011) 244 CLR 530 at 545-546.
For the reasons set out earlier, the question of characterisation focuses on various indicia of the corporation which enable it to be said that the Commonwealth is, or is not, operating through the corporation. The authorities support the proposition that one of the most significant indicia is control. However, I do not accept the Board’s submission that this equates to operational control. That submission finds little, if any, support in the authorities. The Board sought to rely upon a passage in SGH Ltd v Commissioner of Taxation, in the reasons of Callinan J, where in identifying aspects or attributes of a corporation that indicate a statutory intention that the Commonwealth or State should operate through the corporation, he referred, inter alia, to “the participation of the executive government in the process of formulating policy and making decisions”. I do not consider this passage supports any test of operational control. Certainly not in the sense in which the Board propounds the test which requires evidence that Ministers or officers of the executive government are involved in day to day management of the corporation in order to establish the requisite identity between the corporation and the executive government. Rather, it identifies as a relevant factor the involvement of the executive government in forming the policies and directions of the corporation.
It is sufficient that the executive government of the Commonwealth is empowered to exercise ultimate control over the activities and functions of the corporation. Whether that is so requires an analysis which will differ depending on whether the corporation is a statutory corporation or a general law corporation because of the different statutory framework by which each is incorporated and operates.
Where a corporation is a statutory corporation, the particular statutory framework which creates the corporation will be the focus of the inquiry as to whether the corporation is intended to be a vehicle through which the Commonwealth is to undertake a governmental function such that the corporation is the Commonwealth for the purposes of s 52(i). Where a corporation is formed under the general corporations law, the intention to carry on Commonwealth functions through the corporation cannot be ascertained from the terms of the general corporations law statute by which the corporation was created. The inquiry must focus on its articles of association and the broader governance framework applicable to government-owned entities under Commonwealth legislation such as the former Commonwealth Authorities and Companies Act 1997 (Cth) (the CAC Act), which applied at the relevant time.
ARTC
The ARTC is “a wholly-owned Commonwealth company, and is the main vehicle through which the Commonwealth funds investments in rail”.[90] It was established by the Commonwealth and incorporated under the Corporations Law on 24 February 1998 pursuant to the intergovernmental agreement of 30 June 1997. While it is intended that the operation of the ARTC is to be commercial and competitive, that does not detract from the provisions of the ARTC’s articles which applied at the time, which reveal a significant degree of legal control by the Commonwealth over the operations of the ARTC. Neither does it alter the ARTC’s functions which are governmental in nature, namely, managing track maintenance and construction, improving interstate rail infrastructure and providing efficient access to the interstate rail network.[91]
[90] Parliamentary Library, Bills Digest, Appropriations Bill (No 6) 2008-09, agreed book of documents, Tab 18 at p 354.
[91] Section 2.1, Memorandum of Association of ARTC, agreed book of documents, Tab 8A.
Under the ARTC’s articles it was only the Ministers for Transport and Finance who could appoint a director on such terms and conditions as they decided.[92] Ministers[93] by notice in writing could remove a director other than the Chief Executive Officer.[94] Remuneration of directors was to be decided by Ministers in accordance with any applicable determination of the Remuneration Tribunal under the Remuneration Tribunal Act 1973 (Cth).[95] The chairperson of the directors meetings was appointed by the Ministers.[96] While the directors were empowered to appoint the Chief Executive Officer and revoke that appointment,[97] Ministers could remove the Chief Executive Officer.[98] The remuneration of the Chief Executive Officer was to be determined by the directors but had to be in accordance with any applicable determination of the Remuneration Tribunal. Minsters could notify the directors in writing of general policies of the Commonwealth government that were to apply to the ARTC and the directors had to ensure that such policies were carried out.[99] Ministers could declare dividends when acting as the Commonwealth’s representatives, as the sole shareholder.[100]
[92] Article 57, Articles of Association, agreed book of documents, Tab 9 at p 136.
[93] By article 1(1)(c) Minister is defined to mean the Minister of the Commonwealth for the time being responsible for rail transport, and the Minister for Finance and Administration, or their duly appointed delegates, acting jointly.
[94] Article 58(2), Articles of Association, agreed book of documents, Tab 9 at p 136.
[95] Article 59, Articles of Association, agreed book of documents, Tab 9 at p 137.
[96] Article 67(1), Articles of Association, agreed book of documents, Tab 9 at p 140.
[97] Article 75(1), Articles of Association, agreed book of documents, Tab 9 at p 145.
[98] Articles 75(4), 75(5) and 58(1)(e), Articles of Association, agreed book of documents, Tab 9 at pp 145, 136.
[99] Article 60(4), Articles of Association, agreed book of documents, Tab 9 at p 139.
[100] Article 83, Articles of Association, agreed book of documents, Tab 9 at pp 147-148.
Moreover, the control exercised by the Commonwealth over the ARTC was not confined to its articles. At the relevant time, the CAC Act and regulations made thereunder applied to the ARTC as a wholly-owned Commonwealth company[101] and a Government Business Enterprise.[102] A principal feature of the CAC Act was the power conferred on the Finance Minister to make a General Policy Order specifying a policy of the executive government.[103] The ARTC’s directors had to ensure it carried out those orders.[104] This reflected the terms of article 60(4). In addition, the Commonwealth’s power to control the policies and directions of the ARTC was evident from the requirements imposed on the directors of the ARTC by the CAC Act to keep the Ministers informed of the activities of the ARTC and any subsidiaries;[105] to give Ministers any reports, documents or information they require;[106] to notify the Ministers of any proposal to form a company; to participate in or make a significant change to its interests in a significant partnership, trust or joint venture; to acquire or dispose of a significant shareholding in a company or business or to commence or cease a significant business activity;[107] in which case, the Ministers were to notify the Parliament as soon as practicable after any of those events occur;[108] to ensure that the ARTC has an audit committee which had to be constituted and function in accordance with any Commonwealth regulations;[109] to publish annually a corporate plan complying with requirements prescribed by the Minister of Finance and keep the Ministers informed about any changes to the corporate plan;[110] to prepare budget estimates for the ARTC’s activities annually and give them to the Ministers;[111] to have the accounts audited by the Auditor-General;[112] to give the Ministers copies of the annual reports;[113] and to give the Ministers interim reports in accordance with requests by the Minister for Finance, which had to be tabled in the Parliament as soon as practicable.[114]
[101] CAC Act s 34.
[102] CAC Act s 5.
[103] CAC Act s 48A.
[104] CAC Act s 43.
[105] CAC Act s 41(1).
[106] CAC Act s 41(1)(b).
[107] CAC Act s 40(1).
[108] CAC Act s 45(1).
[109] CAC Act s 44.
[110] CAC Act s 42.
[111] CAC Act s 39.
[112] CAC Act s 36(2).
[113] CAC Act s 36.
[114] CAC Act s 38.
Further, as the ARTC was a Government Business Enterprise (GBE) as defined by the CAC Act it was obliged to comply with the Commonwealth Government Business Enterprise Governance and Oversight Guidelines (the Guidelines). The Guidelines describe the “main features of the Commonwealth’s relationship with its GBEs” in the following terms:
(i)a strong interest in the performance and financial returns of the GBE;
(ii)reporting and accountability arrangements that facilitate best practice governance and active oversight by the Commonwealth; and
(iii)action by the Commonwealth in relation to the strategic direction of its GBEs where it prefers a different direction from the one proposed.[115]
[115] 1997 Guidelines at [1.1], agreed book of documents, Tab 10A.

The Guidelines emphasise that the Commonwealth as the shareholder, through its Ministers are to exercise strategic control consistent with their accountability to the Parliament and the public.[116] The Guidelines also provide that, notwithstanding that GBE directors develop business strategies and handle day-to-day management policies, “shareholder Ministers set clear objectives for GBEs” and must be consulted on “matters of significance”.[117] The Guidelines further require that the directors of the GBE ensure that its activities are conducted so as to minimise any divergence of interest between the GBE and its shareholder, the Commonwealth, acting through its Ministers.[118] To that end, the Guidelines indicate that the Ministers are to ensure that the objectives include any requirements to meet the government’s explicitly-stated social and economic policy objectives.[119]
[116] 1997 Guidelines at [1.3(a)], agreed book of documents, Tab 10A.
[117] 1997 Guidelines at [1.3], agreed book of documents, Tab 10A.
[118] 1997 Guidelines at [1.3(d)(i)], agreed book of documents, Tab 10A.
[119] 1997 Guidelines at [1.8], agreed book of documents, Tab 10A.
In my view, the following indicia support the characterisation of the ARTC as the emanation by which the Commonwealth discharges the public purpose of providing rail infrastructure:
·The Finance Minister has the power to give a general policy order on behalf of the executive to apply to the ARTC with which the directors are required to comply;
·The ARTC must formulate a corporate plan which must be approved by the relevant Ministers;
·The Commonwealth executive, through the relevant Ministers, has the power to appoint and remove all directors of the ARTC, except the Chief Executive Officer;
·Ministers have ultimate control over the removal of the Chief Executive Officer of the ARTC because the Chief Executive Officer may be removed by resolution of the sole shareholder who is the Commonwealth, acting through its Ministers;
·The directors and the Chief Executive Officer are remunerated in accordance with determinations of the Remuneration Tribunal;
·Ministers representing the sole shareholder the Commonwealth, in general meeting, can declare dividends to be paid to the Government; and
·The ARTC’s accounts are audited or subject to report by the Auditor-General.
These powers are comparable to the extensive executive control found by the High Court to exist in Queanbeyan v ACTEW[120] and the attributes identified by Callinan J in SGH Ltd v Commissioner of Taxation.[121]These powers enable the Commonwealth as the shareholder, acting through its Ministers, to ensure that the rail track land, vested in the ARTC, continues to be used for the public purpose of rail infrastructure, as has been the position since at least 1917 when the Parliament enacted the Commonwealth Railways Act 1917 (Cth). In my view, they are indicia of the nature and extent of the control exercised by the Commonwealth over the ARTC sufficient to characterise it as an agency or instrumentality of the Commonwealth through which governmental activities in relation to rail are carried on. The Commonwealth is carrying on that public purpose through the ARTC. There is no “barrier” of the kind contended for by the Board to the rail track land vested in the ARTC being a Commonwealth place for the purposes of s 52(i). There is no need for the Commonwealth government to exercise day to day operational control over the business of the ARTC to ensure that the land continues to be used for the purpose of railway infrastructure. That objective is achieved by the powers with which the Commonwealth, acting through its Ministers, is conferred that I have referred to above. Those powers effectively permit control over the land analogous to direct ownership of the land by the Commonwealth. For example, the Commonwealth, through its Ministers, could issue general policy orders in relation to the use, disposal or the prohibition of disposal, of the rail track land. The directors of the ARTC would be obliged to comply with those orders.
[120] [2011] HCA 40 at [31]-[37], (2011) 244 CLR 530 at 545-546.
[121] [2002] HCA 18 at [131], (2002) 210 CLR 51 at 103.
These indicia contraindicate an intention on the part of the Commonwealth, as the Court in Inglis described it, to put into the field the ARTC, as a corporation performing its functions independently of the Commonwealth.
This conclusion is supported by the historic continuity between the Commonwealth Railways Commissioner, the ANRC and the ARTC. The ARTC carries on part of the function previously carried on by the ANRC and, prior to that, by the Commissioner, there being no break in continuity between the carrying on of that function by the ANRC and the ARTC, and the land on which the rail network is located was vested by statute in the ARTC as successor in law of the ANRC, for the purpose of the continuation of that function. To that extent, the ARTC continues to serve a governmental purpose, albeit one that is facilitated by operating within a commercial environment, pursuant to Commonwealth government policy, to ensure its operations are commercially sustainable. The position of the ARTC has obvious parallels with the position of the FAC in Allders. The acquisition of the land by the Commonwealth for public purposes did not cease by the vesting of the land in the ARTC. It continued to be such a place.
Conclusion
The ARTC is a body through which the Commonwealth operates in the field of railways construction, maintenance and access. The ARTC is an emanation of the Commonwealth and the ARTC rail network land is a place acquired by the Commonwealth for public purposes within the meaning of s 52(i) of the Constitution. The first question posed on referral should be answered: “Yes”. The second question should be answered: “It does not arise”.
NICHOLSON J: I agree that the questions are to be answered in the way indicated by Stanley J and with his Honour’s reasons.

[2017] SASCFC 103

17 August 2017

Key Legal Topics

Areas of Law

Constitutional Law

Statutory Interpretation

Legal Concepts

Jurisdiction

Statutory Construction

Standing