Cubillo v Commonwealth

[2001] FCA 1213

FEDERAL COURT OF AUSTRALIA

CUBILLO & GUNNER v THE COMMONWEALTH

D10 OF 2000; D11 OF 2000

SUMMARY

In accordance with the practice of the Federal Court in cases of public interest, the Court has prepared this brief summary to accompany the reasons for judgment, delivered today. It must, of course, be emphasised that the only authoritative pronouncement of the Court's reasons is that contained in the published reasons for judgment. This summary is intended to assist in understanding the principal conclusions reached by the Court, but is necessarily incomplete.

On 11 August 2000, a Judge of the Federal Court, O’Loughlin J, dismissed proceedings brought by Lorna Cubillo and Peter Gunner against the Commonwealth.  Mrs Cubillo and Mr Gunner have appealed against the judgment of the primary Judge.  The judgment we publish today deals with the arguments presented on the appeal.

Mrs Cubillo was aged eight when she was taken, along with fifteen other part-Aboriginal children, from the Phillip Creek Settlement, about forty kilometres north of Tennant Creek in the Northern Territory, in 1947.  She was taken to the Retta Dixon Home in Darwin and remained there until October 1956.  Mr Gunner was aged seven when he was removed from Utopia Station and taken to St Mary’s Hostel, south of Alice Springs, in May 1956.  He remained there until 1963.  The Retta Dixon Home was conducted by the Aborigines Inland Mission of Australia, while St Mary’s Hostel was run by the Australian Board of Missions.

The appellants claimed at the trial that their removal had taken place in consequence of a policy, endorsed by successive Commonwealth governments, whereby part Aboriginal children were taken from their families and placed in missions or institutions.  The appellants said their removal and detention caused them pain and suffering (including serious psychological harm), loss of enjoyment of life and loss of cultural heritage.  They also said that the Commonwealth was legally responsible for the wrongs done to them and was liable to compensate them in damages.

The appellants each relied on four causes of action to support their claims for damages:

(i)wrongful imprisonment and deprivation of liberty;

(ii)a breach of the statutory duty allegedly owed to them by the Director of Native Affairs, in failing to provide for their custody, maintenance and education, for which breach the Commonwealth was said to be vicariously responsible;

(iii)a breach of the duty of care allegedly owed to them by the Commonwealth; and

(iv)a breach of the Commonwealth’s fiduciary duties.

The trial before the primary Judge lasted 106 days.  His Honour’s judgment runs to 485 printed pages.  The legal and factual issues dealt with by the primary Judge were complex.

The primary Judge emphasised that the case presented particular difficulties because so much time had passed since the relevant events.  (Mrs Cubillo’s removal had occurred more than fifty years before the trial while, in Mr Gunner’s case, more than forty years had elapsed.)  There were therefore very large gaps in the evidence.  His Honour also pointed out that the appellants had chosen to sue only the Commonwealth.  They had not sued, for example, the Directors of Native Affairs or Welfare.  Nor had they sued the individuals who (as the primary Judge found) had separately assaulted Mrs Cubillo and Mr Gunner while they were institutionalised.  The issue was not therefore whether anyone was liable to the appellants for what they had experienced, but whether the Commonwealth was liable.

The primary Judge rejected the appellants’ claims against the Commonwealth, essentially for two reasons.

First, on the evidence presented at the trial, his Honour found that the appellants had failed to establish any of the causes of action on which they had relied.  Although the primary Judge accepted much of the evidence given by the appellants, he made a number of significant findings adverse to their case.  In particular, his Honour found that on the evidence before him

·     at the relevant times, there was no general policy in force in the Northern Territory supporting the indiscriminate removal and detention of part-Aboriginal children, irrespective of the personal circumstances of each child;

·     Mrs Cubillo had failed to establish that, at the time of her removal, she was in the care of an adult Aboriginal person whose consent to her removal had not been obtained;

·     Mr Gunner’s mother, Topsy Kundrilba, had given her informed consent to her son’s removal from Utopia Station to St Mary’s Hostel; and

·     the Commonwealth had not actively promoted or caused the appellants’ detention.

Secondly, the primary Judge refused to grant an extension of time to the appellants in which to institute proceedings in respect of their common law causes of action (wrongful imprisonment and breach of duty).  Such an extension of time was necessary because the causes of action had become barred under Northern Territory legislation by reason of the very long delay in commencing proceedings.  The primary Judge found that the Commonwealth had suffered “irremediable prejudice” in defending the proceedings since it was unable to bring forward evidence from potential witnesses who had died or who were unavailable because of ill health.  His Honour, in the exercise of his discretion, declined to grant an extension of time.

The issues on the appeal were considerably narrower than those dealt with by the primary Judge.  For example, the appellants no longer pressed their claim founded on breach of statutory duty.  More importantly, they did not challenge the major factual findings, adverse to their case, made by the primary Judge.  They also accepted that the Commonwealth had sustained significant prejudice in defending the case, by reason of the delay in the appellants commencing the proceedings.

It is also important to appreciate that we have found that the appellants attempted to alter their case on appeal.  In particular, they sought to reformulate the breach of duty case in an effort to overcome adverse findings of fact made by the primary Judge.  We have concluded that it would be unfair to the Commonwealth, and not in accordance with legal principle, to permit the appellants to change their case at this late stage in the proceedings.

So far as the primary Judge’s rejection of the appellants’ substantive claims are concerned, we have reached the following conclusions:

·     The primary Judge did not err in rejecting the appellants’ false imprisonment claims.  The unchallenged findings of fact are very difficult for the appellants to overcome.  Alternative legal arguments advanced by them on the appeal do not demonstrate that the primary Judge made any error.

·     The primary Judge correctly held that there was no basis for the appellants’ claims founded on an alleged breach of fiduciary duties said to be owed by the Commonwealth to the appellants.

We also have decided that it was open to the primary Judge to hold that the Commonwealth had sustained irremediable prejudice by reason of the appellants’ delay in commencing proceedings and that no extension of time should be granted to them.  It follows that, independently of the primary Judge’s rejection of the appellants’ substantive claims, his Honour was entitled to hold that the appellant’s common law causes of action had to fail.  In our view, it was also open to the primary Judge to hold (as he did) that any equitable claim based on breach of fiduciary duties had been barred because of the lapse of time.

We make one further observation.  We are, of course, conscious of the controversy surrounding the existence or otherwise of what has become known as the “Stolen Generation”.  Neither the primary Judge nor this Court was asked to make findings on this issue, and it would be inappropriate for us to do so.  The questions raised at the trial and on the appeal concerned the circumstances in which two individuals, Mrs Cubillo and Mr Gunner, were long ago removed from their families and placed in institutions, and the legal consequences that flowed from those events.  Our task, like that of the primary Judge, is to decide the issues presented to us in accordance with law.

The result is that the appeals have been dismissed.

The full text of the Court’s judgment, reported as Cubillo & Gunner v The Commonwealth [2001] FCA 1213, will shortly be available on the Court’s website at align="center">FEDERAL COURT OF AUSTRALIA

Cubillo v Commonwealth of Australia [2001] FCA 1213

FALSE IMPRISONMENT – removal of part-Aboriginal children in 1947 and 1953 from their families and placement in institutions – whether the Commonwealth actively promoted or caused the appellants’ detention – whether a committal order under s 6 of the Aboriginals Ordinance 1918 (NT) (“Aboriginals Ordinance”) was vitiated by Wednesbury unreasonableness – whether finding that the Director of Native Affairs detained the appellants was justified on the evidence – whether it was common ground at trial that the Directors of Native Affairs and Welfare had not exercised their statutory powers in relation to the appellants – whether independent discretion rule applies.

BREACH OF DUTY – reformulation of appellants’ case on alleged breaches of duty by the Commonwealth – whether the appellants should be permitted to raise new arguments on appeal – whether Commonwealth would be prejudiced.

LIMITATION OF ACTIONS – common law causes of action statute barred – whether primary Judge erred in refusing an extension of time in which to institute proceedings pursuant to s 44(3)(b) of the Limitations Act 1981 (NT) – whether primary Judge bound to consider each cause of action separately – whether primary Judge erred in finding that the Commonwealth had sustained irremediable prejudice.

EQUITY – fiduciary duties – whether findings of fact precluded a claim founded on breach of fiduciary duties – whether equitable claims barred in any event by laches.

The Constitution s 75(iii)

Federal Court of Australia Act 1976 (Cth), ss 24(1A), 27.
Judiciary Act 1903 (Cth), ss 35(1)(a), 44(2A), 44(3), 79.
Aboriginals Ordinance 1918 (NT), ss 3, 3A, 4, 5, 6, 7, 8, 13, 15, 16, 17, 19.
Aboriginal Land Rights (Northern Territory) Act 1976 (Cth).
Limitation of Suits and Actions Act 1866 (SA), ss 36, 37, 47.
Limitation Act 1981 (NT), ss 3, 9, 12, 21, 22, 36, 44.
Northern Territory Acceptance Act 1910 (Cth), s 7.
Northern Territory (Administration) Act 1910 (Cth), s13
Northern Territory (Administration) Act 1947 (Cth), ss 4N, 4U, 4V, 4W, 4Y.
Aboriginals Ordinance 1911 (NT).
Northern Territory Aboriginals Act 1910 (SA).
Welfare Ordinance 1953 (NT) ss 6, 7, 8, 10, 14, 17, 24, 32.
Welfare Ordinance (No 2) 1957 (NT), s 4.
Welfare Ordinance 1961 (NT), s 5.
Aboriginals Ordinance 1939 (NT), ss 2, 3, 4.
Aboriginals Ordinance (No. 2) 1953  (NT), ss 3, 4, 5, 7, 8.
Limitation Act 1985 (ACT).
Limitation of Actions Act 1994 (Qld), s 31(2).
Limitation of Actions Act 1936 (SA)
Limitation Act 1969 (NSW), s 60E(1).

Federal Court Rules, O 52 r 10(2)(b), O 11 r 2(a).

Kruger v Commonwealth (1997) 190 CLR 1, discussed.
Northern Territory v GPAO (1999) 196 CLR 553, cited.
Waters v The Commonwealth (1951) 82 CLR 188, cited.
Ross v Chambers (Unreported, NTSC, 5 April 1956, Kriewaldt J), discussed.
Namatjira v Raabe (1959) 100 CLR 664, cited.
Australian Securities and Investments Commission v Edensor Nominees Pty Ltd (2000) 177 ALR 329, cited.
Paramasivam v Flynn (1998) 90 FCR 489, discussed.
Carr v Finance Corporation of Australia Ltd (1980) 147 CLR 246, cited.
Sanofi v Park Davis (1980) 149 CLR 147, cited.
Hall v Nominal Defendant (1996) 117 CLR 423, cited.
Dousi v Colgate Palmolive Pty Ltd (1987) 9 NSWLR 374, cited.
Meddings v The Council of the City of the Gold Coast [1988] 1 Qd R 528, cited.
Southern Cross Exploration NL v Fire and All Risks Insurance Company Ltd (No 2) (1990) 21 NSWLR 200, cited.
D A Christie Pty Ltd v Baker [1996] 2 VR 582, cited.
Associated Provincial Picture Houses Ltd v Wednesbury Corporation [1948] 1 KB 223, cited.
Myer Stores Ltd v Soo [1991] 2 VR 597, considered.
Field v Nott (1939) 62 CLR 660, cited.
Murray v Ministry of Defence [1988] 1 WLR 692, cited.
Herring v Boyle (1834) 1 CM&R 377; 149 ER 1126, cited.
Oceanic Crest Shipping Company v Pilbara Harbour Services Pty Ltd (1986) 160 CLR 626, cited.
Enever v The King (1906) 3 CLR 969, cited.
Attorney-General (NSW) v Perpetual Trustee Co. Ltd (1952) 85 CLR 237, cited.
Attorney-General (NSW) v Perpetual Trustee Co. Ltd [1955] AC 457, cited.
Australian Competition and Consumer Commission v Golden Sphere International Inc. (1998) 83 FCR 424, cited.
Clayton Robard Management Ltd v Siu (1988) 162 CLR 24, cited.
Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24, cited.
Attorney-General (NSW) v Quin (1990) 170 CLR 1, cited.
Minister for Immigration and Multicultural Affairs v Eshetu (1999) 197 CLR 611, cited.
Friends of Hinchinbrook Society Inc v Minister for the Environment (No 2) (1997) 69 FCR 28, cited.
CDJ v VAJ (1998) 197 CLR 172, cited.
Allesch v Maunz (2000) 173 ALR 648, cited.
Warren v Coombes (1979) 142 CLR 531, applied.
Minister for Immigration and Multicultural Affairs v Jia 178 ALR 421, cited.
News Ltd v Australian Rugby Football League Ltd (1996) 64 FCR 410, cited.
Minister for Immigration, Local Government and Ethnic Affairs v Hamsher (1992) FCR 359, applied.
Crimmins v Stevedoring Industry Finance Committee (1999) 200 CLR 1, considered.
X (Minors) v Bedfordshire County Council [1995] 2 AC 633, considered.
Barrett v Enfield London Borough Council [1999] 3 WLR 79, considered.
Stovin v Wise [1996] AC 923, cited.
Pyrenees Shire Council v Day (1998) 192 CLR 330, cited.
Attorney-General v Prince [1998] 1 NZLR 262, cited.
B v Attorney-General [1999] 2 NZLR 296, cited.
W v Attorney-General [1999] 2 NZLR 709, cited.
Hillman v Black (1996) 67 SASR 490, cited.
Phelps v Hillingdon London Borough City Council [2000] 4 All ER 504, cited.
Perre v Apand Pty Ltd (1999) 198 CLR 180, cited.
Banque Commerciale SA En Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279, cited.
Mitanis v Pioneer Concrete (Vic) Pty Ltd (1997) ATPR 41-591, cited.
Water Board v Moustakas (1988) 180 CLR 491, applied.
Sola Optical Australia Pty Ltd v Mills (1987) 163 CLR 628, considered.
Ward v Walton (1989) 66 NTR 20, cited.
Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541, applied.
Williams v Minister, Aboriginal Land Rights Act 1983 (No 2) (1999) 25 Fam LR 86, cited.
House v The King (1936) 55 CLR 499, cited.
Lovell v Lovell (1950) 81 CLR 513, cited.
Sydney City Council v Zegarac (1998) 43 NSWLR 195, cited.
Holt v Wynter (2000) 49 NSWLR 128, cited.
Ravinder Rihini Pty Ltd v Krizaic (1991) 30 FCR 300, cited.
Bennett v Minister of Community Welfare (1992) 176 CLR 408, cited.
Lindsay Petroleum Co. v Hurd (1874) LR 5 PC 221, cited.
Orr v Ford (1989) 167 CLR 316, applied.
Clay v Clay (2001) 178 ALR 193, cited.
Countess of Bective v Federal Commissioner of Taxation (1932) 47 CLR 417, cited.
Wik Peoples v Queensland (1996) 187 CLR 1, cited.
Pilmer v Duke Group Ltd (2001) 180 ALR 249, applied.
Norberg v Wynrib [1992] 2 SCR 226, cited.
Securities and Investments Commission v Chenery Corporation (1943) 318 US 80, cited.
Breen v Williams (1996) 186 CLR 71, cited.
Tito v Waddell (No 2) [1977] Ch 106, cited.

Human Rights and Equal Opportunity Commission, Bringing Them Home: Report of the National Inquiry into the Separation of Aboriginal and Torres Strait Islander Children from Their Families (1997).
Senate Legal and Constitutional References Committee, Healing: A Legacy of Generations (2000).
Peter Read, The Stolen Children: The Removal of Aboriginal Children in New South Wales 1883 to 1969 (1982).
J Clarke, Case Note (Cubillo v Commonwealth) (2001) 25 Melb Uni LR 218.
Cross on Evidence (6^th Aust ed).

LORNA CUBILLO v COMMONWEALTH OF AUSTRALIA
D 10 of 2000
PETER GUNNER v COMMONWEALTH OF AUSTRALIA
D 11 of 2000

SACKVILLE, WEINBERG & HELY JJ
MELBOURNE
31 August 2001

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	D 10 OF 2000

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	LORNA CUBILLO APPELLANT
AND:	COMMONWEALTH OF AUSTRALIA RESPONDENT
JUDGES:	SACKVILLE, WEINBERG & HELY JJ
DATE OF ORDER:	31 AUGUST 2001
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.   The appeal be dismissed.

2.   The parties file and serve written submissions as to costs within 28 days.

Note:   Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	D 11 OF 2000

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:	PETER GUNNER APPELLANT
AND:	COMMONWEALTH OF AUSTRALIA RESPONDENT
JUDGES:	SACKVILLE, WEINBERG & HELY JJ
DATE OF ORDER:	31 AUGUST 2001
WHERE MADE:	MELBOURNE

THE COURT ORDERS THAT:

1.   The appeal be dismissed.

2.   The parties file and serve written submissions as to costs within 28 days.

Note:   Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

TABLE OF CONTENTS

INTRODUCTION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 1

COURSE OF THE PROCEEDINGS........ ........ ........ ........ ........ ........ ........ .. 4

THE PLEADED CASES........ ........ ........ ........ ........ ........ ........ ........ ........ ... 4
THE INTERLOCUTORY JUDGMENT........ ........ ........ ........ ........ ........ .... 6
THE WITNESSES........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 8
THE ORDERS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 11

THE LEGISLATION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 12

THE ORDINANCE MAKING POWER........ ........ ........ ........ ........ ........ ... 12
THE ABORIGINALS ORDINANCE 1918 (NT)........ ........ ........ ........ ...... 13

The Provisions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 13
Case Law........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 17

THE WELFARE ORDINANCE 1953 (NT)........ ........ ........ ........ ........ ..... 21

The Provisions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 21
Case Law........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 23

THE LIMITATIONS LEGISLATION........ ........ ........ ........ ........ ........ ..... 24

The Judiciary Act........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 24
The Limitation Periods........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 25
When Were the Tortious Causes of Action Barred?........ ........ ........ ........ ........ ........ .. 27
An Extension of Time........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 29

THE FACTS........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 30

MRS CUBILLO........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 30

Background........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 30
The Phillip Creek Settlement........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 31
The Removal........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... 32
Did the Parents Consent?........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 34

Who Made the Decision?........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 35
The Retta Dixon Home........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 36
The 1953 Committal Order........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... 39
The Walter Incident........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 39
After the Retta Dixon Home........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 41

MR GUNNER........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 42

The Removal........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... 42
St Mary’s Hostel........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 44
The Constable Incidents........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 47
After St Mary’s Hostel........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 47

THE PRIMARY JUDGMENT........ ........ ........ ........ ........ ........ ........ ........ .. 48

A BRIEF OVERVIEW........ ........ ........ ........ ........ ........ ........ ........ ........ .... 49

Findings of Fact........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 49
Vicarious Liability........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 52
Extension of Time........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 54
Damages........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 54
Basis for the Orders........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 55

FINAL OR INTERLOCUTORY?........ ........ ........ ........ ........ ........ ........ .... 56

THE SCOPE OF THE APPEAL........ ........ ........ ........ ........ ........ ........ ....... 57

THE FALSE IMPRISONMENT CLAIMS........ ........ ........ ........ ........ ....... 61

THE PLEADED CASE........ ........ ........ ........ ........ ........ ........ ........ ........ ... 61
UNLAWFUL DETENTION ARGUMENT........ ........ ........ ........ ........ ...... 63
THE PRIMARY JUDGMENT ON FALSE IMPRISONMENT........ ........ 66

The Reasoning........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 66
Why Did the Primary Judge Reject the False Imprisonment Claims?........ ........ .... 72

THE APPELLANTS’ PRIMARY CASE ON FALSE IMPRISONMENT. 77

The Finding that the Commonwealth did not Actively Promote or Cause the
Appellants’ Imprisonment........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 77

Mrs Cubillo........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 77
Mr Gunner........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 79

Wednesbury Unreasonableness: Mr Gunner........ ........ ........ ........ ........ ........ ........ ...... 80

THE UNLAWFUL DETENTION ARGUMENT: THE
COMMONWEALTH’S NOTICE OF CONTENTION........ ........ ........ ..... 82

The Principles........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 82
The Finding That the Director Detained Mrs Cubillo........ ........ ........ ........ ........ ....... 84
The Finding that the Director Detained Mr Gunner........ ........ ........ ........ ........ ........ . 87

THE APPELLANTS’ CHALLENGE TO THE REJECTION OF THE
UNLAWFUL DETENTION ARGUMENT........ ........ ........ ........ ........ ...... 89

Was it Common Ground that the Directors had Not Exercised Their Statutory Powers?          90
The Independent Discretion Rule........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 92

THE FINDING OF PREJUDICE........ ........ ........ ........ ........ ........ ........ ... 95

THE BREACH OF DUTY CLAIMS........ ........ ........ ........ ........ ........ ........ . 98

THE PLEADED CASE........ ........ ........ ........ ........ ........ ........ ........ ........ ... 98
THE PRIMARY JUDGMENT........ ........ ........ ........ ........ ........ ........ ....... 101

Understanding the Case Pleaded........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 101
Duty of Care........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 102
Vicarious Liability........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 107
Breach of Duty........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... 107
Causation and Remoteness of Damage........ ........ ........ ........ ........ ........ ........ ........ ...... 109

THE APPELLANTS’ CASE ON APPEAL........ ........ ........ ........ ........ .... 110

The Appellants’ Written Submissions........ ........ ........ ........ ........ ........ ........ ........ ....... 110
The Commonwealth’s Written Submissions........ ........ ........ ........ ........ ........ ........ ..... 112
The Oral Submissions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 113

WAS THE CASE ON APPEAL PUT AT TRIAL?........ ........ ........ ........ .. 117

The Manner of Removal........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... 117
The Failure to Maintain Contact........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 124
Liability for Physical and Sexual Assault........ ........ ........ ........ ........ ........ ........ ........ .. 127
The Unsuitability of St Mary’s Hostel........ ........ ........ ........ ........ ........ ........ ........ ....... 129
The Failure to Ensure that Mr Gunner’s Mother was Properly Informed........ ... 130

THE FINDING OF PREJUDICE........ ........ ........ ........ ........ ........ ........ . 131

EXTENSION OF TIME........ ........ ........ ........ ........ ........ ........ ........ ........ .. 133

THE PRIMARY JUDGMENT ON EXTENSION OF TIME........ ........ .. 133
THE APPELLANTS’ SUBMISSIONS........ ........ ........ ........ ........ ........ .. 139
THE COMMONWEALTH’S SUBMISSIONS........ ........ ........ ........ ....... 141
REASONING........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 142

The Principles........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 142
The Cause of Action Argument........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 147
The Findings of Prejudice........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ... 149
Exercise of Discretion........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 149
The Notice of Contention........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 149

FIDUCIARY DUTIES........ ........ ........ ........ ........ ........ ........ ........ ........ ..... 150

THE APPELLANTS’ CLAIMS........ ........ ........ ........ ........ ........ ........ ..... 150
THE PRIMARY JUDGMENT ON FIDUCIARY DUTIES........ ........ .... 151
THE SCOPE OF FIDUCIARY DUTIES........ ........ ........ ........ ........ ....... 153
THE ALLEGED CONFLICT OF INTEREST AND DUTY........ ........ ... 153
LACHES........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 153

DAMAGES........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 153

CONCLUSION........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 153

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY	D 10 OF 2000 D 11 OF 2000

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

BETWEEN:

LORNA CUBILLO
APPELLANT

PETER GUNNER
APPELLANT

AND:

COMMONWEALTH OF AUSTRALIA
RESPONDENT

JUDGES:	SACKVILLE, WEINBERG & HELY JJ
DATE:	31 AUGUST 2001
PLACE:	MELBOURNE

REASONS FOR JUDGMENT

INTRODUCTION

1. On 11 August 2000, a Judge of this Court, O’Loughlin J, dismissed proceedings brought by Lorna Cubillo (“Mrs Cubillo”) and Peter Gunner (“Mr Gunner”) against the respondent (“the Commonwealth”): Cubillo v The Commonwealth (No 2) (2000) 103 FCR 1. The two proceedings were heard together and raised similar, although not identical, issues. Mrs Cubillo and Mr Gunner have each appealed against the judgment of the primary Judge.

2. There is a question as to whether his Honour’s judgment was final or interlocutory in character.  The significance of that question is that the answer determines whether Mrs Cubillo and Mr Gunner are entitled to appeal as of right or whether they must first obtain the leave of the Court: see Federal Court of Australia Act 1976 (Cth) (the “Federal Court Act”), s 24(1A). We address the question later (see [181] below).  In this judgment, we refer to Mrs Cubillo and Mr Gunner together as “the appellants”.

3. The trial before the primary Judge occupied 106 sitting days over a period commencing on 3 August 1998 and concluding on 31 March 2000.  His Honour heard evidence in Darwin, Tennant Creek, Alice Springs and Melbourne.  The judgment, as reported in the Federal Court Reports is 485 pages in length.  Both the trial and the judgment attracted intense public interest.

4. The degree of interest in the case reflected the nature of the allegations made by the appellants.  While it is not easy to summarise accurately the contentions advanced by the appellants at trial, the first two paragraphs of his Honour’s judgment capture the broad scope of the appellants’ case:

   “The applicants, Mrs Lorna Cubillo and Mr Peter Gunner, are said to be members of ‘the Stolen Generation’.  That is the term that has been widely used to refer to the former practice of taking part-Aboriginal children from their families and placing them in missions or institutions.  Mrs Cubillo has claimed that in 1947 she and 15 other children were forcibly removed by servants or agents of the respondent from the Phillip Creek Native Settlement and thereafter detained in the Retta Dixon Home in Darwin.  Mr Gunner has claimed that in 1956 he was forcibly removed by servants or agents of the [Commonwealth] from Utopia Station and thereafter detained in St Mary’s Hostel in Alice Springs.  The applicants have instituted proceedings against the [Commonwealth], alleging that it is the party which bears the legal responsibility for the injuries and damages that they have suffered as a result of their removal and detention.  Their claims for compensation have been rejected by the Commonwealth.

   The opening statement in the closing submissions of counsel for the applicants laid out the base upon which these proceedings were fought:

   ‘These cases concern great injustice done by the Commonwealth of Australia to two of its citizens.  By the actions of the Commonwealth, Lorna Cubillo and Peter Gunner were removed as young children from their families and communities.  They were taken hundreds of kilometres from the countries of their birth.  They were prevented from returning.  They were made to live among strangers, in a strange place, in institutions which bore no resemblance to a home.  They lost, by the actions of the Commonwealth, the chance to grow among the warmth of their own people, speaking their people’s languages and learning about their country.  They suffered lasting psychiatric injury.  They were treated as orphans when they were not orphans.  They lost the culture and traditions of their families.  Decades later, the Commonwealth of Australia says in this case that it did them no wrong at all’.”

5. According to the findings of the primary Judge, Mrs Cubillo was born on 8 August 1938 and was therefore aged eight when she was removed from the Phillip Creek Settlement to the Retta Dixon Home in Darwin in July 1947.  She remained at the Retta Dixon Home until October 1956.  Both the Phillip Creek Settlement and the Retta Dixon Home were conducted by the Aborigines Inland Mission of Australia (“AIM”).  At the time of her removal, Mrs Cubillo was known as Lorna Nelson and her traditional name was Napanangka. 

6. The primary Judge accepted that Mr Gunner was born on 19 September 1948 (although there was some uncertainty about the precise date).  He was therefore aged seven when he was removed from Utopia Station to St Mary’s Hostel, located to the south of Alice Springs, in May 1956.  St Mary’s was established by Sister Eileen Heath as a hostel for part-Aboriginal children in 1946 and shortly thereafter was acquired by the Australian Board of Missions (“ABM”), an Anglican mission organisation.  Mr Gunner remained at St Mary’s Hostel until February 1963.

7. An especially unusual feature of this case is that the trial took place more than 50 years after Mrs Cubillo’s removal from the Phillip Creek Settlement and more than 40 years after Mr Gunner’s removal from Utopia Station.  The extremely long delay between the occurrence of the key events and the institution of legal proceedings played an important part in the arguments advanced both at trial and on the appeal.  The lapse of time may be of little consequence to historians or social commentators who seek to interpret the events that took place decades ago.  But it is of considerable significance in a legal system that places a high value on the parties to a dispute receiving a fair trial.

8. It is also important to appreciate that the appellants sued only the Commonwealth.  They did not sue, for example, the AIM or the ABM (the operators of the institutions in which the appellants were placed) or the individuals who were alleged to have assaulted or mistreated each of them in the institutions.  Nor did the appellants sue the estates of the various Directors of Native Affairs or Welfare in the Northern Territory who were said to have been responsible for unlawfully removing and detaining them.  Doubtless the appellants had good reasons not to join other parties to the proceedings.  There is, for example, no legislation in force in the Northern Territory which sheets home to later office holders legal responsibility for any wrongdoing that may have been committed by their predecessors.  Moreover, there are obvious practical difficulties in instituting proceedings against the estates of persons who died long ago.  Be that as it may, the question presented by the case was whether the Commonwealth, not some other person or entity, was liable to compensate the appellants for the wrongs allegedly done to them as children so many years ago. 

9. The primary Judge’s reasons for dismissing the appellants’ claims were complex and detailed.  His Honour made it clear, however, that he saw his task as to determine the specific allegations made by each of the appellants and not to pass judgment on the social policies that led to the removal and institutionalisation of many part-Aboriginal children (at [79]):

   “The task of the court is to examine the evidence – both oral and documentary – in a clinical manner, devoid of emotion, for the purpose of ascertaining, first whether the applicants have causes of action against the Commonwealth; secondly, whether, if they do, they should be permitted to prosecute them, having regard to their delay in the institution of proceedings; and thirdly, if they are permitted to prosecute them, whether they have made out their claims.”

   (The broader issues are examined by the Human Rights and Equal Opportunity Commission, Bringing Them Home: Report of the National Inquiry into the Separation of Aboriginal and Torres Strait Islander Children from Their Families (1997) and the Senate Legal and Constitutional References Committee, Healing: A Legacy of Generations (2000)).

10. We are, of course, conscious of the controversy surrounding the existence or otherwise of what has become known as the “Stolen Generation” (a term apparently coined by Peter Read, The Stolen Children: The Removal of Aboriginal Children in New South Wales 1883 to 1969 (1982)).  It is, however, important to stress that neither the primary Judge nor this Court was asked to make findings on that issue, and it would be inappropriate for us to do so.  The task of this Court is to determine the matter in controversy by application of the law to the facts determined in accordance with proper procedures.  The questions raised at the trial and on the appeal concerned the circumstances in which two individuals, Mrs Cubillo and Mr Gunner, were long ago removed from their families and placed in institutions and the legal consequences that flow from those events.  Moreover, as will become clear, the issues on appeal were considerably narrower than those at trial.  We have therefore had no occasion to revisit the evidence which led his Honour to make findings about the policies of successive Commonwealth Governments relating to the removal of part-Aboriginal children from their families. Nothing we say should be read as indicating any view which we may have about those findings.

    COURSE OF THE PROCEEDINGS

    THE PLEADED CASES

11. Mrs Cubillo and Mr Gunner commenced separate proceedings in the High Court of Australia on 30 October 1996 and 31 October 1996, respectively.  The proceedings were within the original jurisdiction of the High Court since the Commonwealth was a party to each action: Constitution, s 75(iii). The High Court, by orders made on 26 November 1996 pursuant to s 44 of the Judiciary Act 1903 (Cth) (“Judiciary Act”), remitted further proceedings to the Federal Court. Orders were ultimately made by the primary Judge that the proceedings be heard together and that evidence in one be evidence in the other.

12. The cases pleaded by Mrs Cubillo and Mr Gunner were similar.  They alleged that they had been removed from their families and detained in institutions against their will.  They further alleged that the Commonwealth had been responsible for taking them into custody and, thereafter for detaining them.  The appellants each relied on four causes of action to support their claims for compensatory, aggravated and exemplary damages against the Commonwealth:

    (i)the “wrongful imprisonment and deprivation of liberty” of each of the appellants, a claim based principally but not solely on the ground that their removal and detention by the Director of Native Affairs were unlawful and beyond the powers conferred by ss 6, 7 and 16 of the Aboriginals Ordinance 1918 (NT) (“Aboriginals Ordinance);

    (ii)a breach of the statutory duty allegedly owed by the Director of Native Affairs to each of the appellants, in failing to provide for their custody, maintenance and education as required by s 5(1)(d) and (f) of the Aboriginals Ordinance, for which breach the Commonwealth was said to be vicariously liable;

    (iii)a breach of the duty of care allegedly owed by the Commonwealth to each of the appellants (a claim put in a variety of ways, but primarily on the basis that the removal and detention of each appellant breached the Commonwealth’s “duty to take reasonable care” because the Commonwealth and the Director of Native Affairs had failed to take into account the individual circumstances of each appellant, in particular the relationship with his or her family and community); and

    (iv)a breach of the fiduciary duty said to be owed by the Commonwealth to each of the appellants.

1. The appellants ultimately contended that they were each entitled to be compensated for pain and suffering (including psychological injury), loss of enjoyment of life, loss of culture and of entitlements associated with being recognised as a traditional owner of traditional lands for the purposes of the Aboriginal Land Rights (Northern Territory) Act 1976 (Cth) (“Land Rights Act”).  The appellants also pleaded that the Commonwealth had acted with a “conscious and contumelious disregard for [their] welfare and rights”, thereby causing substantial distress and humiliation.  This plea was said to justify a claim for aggravated and exemplary damages against the Commonwealth.

2. The defences filed on behalf of the Commonwealth included pleas that, insofar as the appellants sought damages at common law or for breach of statutory duty, their claims had been statute barred by the Limitation of Suits and Actions Act 1866 (SA) (“1866 Act”) or the Limitation Act 1981 (NT) (“Limitation Act”), both of which were said to apply to the proceedings by virtue of the Judiciary Act.  The Commonwealth also pleaded that any claims for equitable compensation were barred either by analogy to the barring by statute of the common law claims or by the doctrine of laches.

3. The response of the appellants to the Commonwealth’s limitation defence was to seek, if necessary, an order pursuant to s 44 of the Limitation Act extending the time for the institution of proceedings against the Commonwealth claiming damages at common law or for breach of statutory duty.  The appellants also denied that their claims for equitable compensation had been barred.

4. The Commonwealth opposed the appellants’ application for an extension of time on the ground that it would be unjust for the application to be granted having regard to the unreasonable delay in claiming relief and the consequent prejudice to the Commonwealth in defending the proceedings.  The principal prejudice sustained by the Commonwealth was said to be the difficulty in identifying and locating witnesses, the unavailability of witnesses and the inability of witnesses to recall the relevant circumstances.

   THE INTERLOCUTORY JUDGMENT

5. At a directions hearing on 12 March 1998, counsel for the Commonwealth advised the primary Judge that the Commonwealth intended to move for summary dismissal of the proceedings.  Time was set aside in August 1998 for the hearing of the foreshadowed motion.  To take account of the possibility that the motion might not succeed, the trial was listed to commence on 1 March 1999.

6. On 5 June 1998, the Commonwealth filed the foreshadowed motion. In the alternative to orders dismissing the proceedings, the Commonwealth sought an order that the appellants’ applications for an extension of time under s 44 of the Limitation Act be determined as separate questions before the trial of other issues.

7. In the event, the time set aside in August 1998 was devoted to hearing, in advance of the trial proper, evidence from six aged and frail witnesses.  The Commonwealth’s motion was heard in March 1999, immediately following the opening addresses given at the trial by counsel for the appellants and for the Commonwealth.

8. The primary Judge delivered a detailed interlocutory judgment on 30 April 1999 in which he declined to make the orders sought by the Commonwealth: Cubillo v Commonwealth (1999) 89 FCR 528 (“Cubillo (No 1)”).  His Honour held that each of the actions should be permitted to go to trial and that none of the pleaded causes of action should be struck out.  He criticised aspects of the pleaded cases, but granted leave to the appellants to file further amended statements of claim consistent with his reasons for judgment.

9. The primary Judge noted (at 587) that the appellants maintained that they had separate causes of action in respect of each category of damage sustained by them.  They had submitted that their respective causes of action for psychiatric and psychological injuries did not accrue until each appellant had become aware, or should reasonably have become aware, of the existence of the injuries and of their connection to his or her removal and detention.  These events were said to have occurred within the relevant limitation periods.  His Honour pointed out that it would be very difficult to test this submission without evidence establishing when the appellants had sustained their injuries and when each related the injuries to his or her removal and detention.  The primary Judge also took the view (at 590) that it was desirable to hear evidence on the factual questions raised by the appellants’ application for extension of time. In these circumstances, he concluded that it was inappropriate to order that the applications for extensions of time be heard and determined prior to the trial of the substantive issues raised by the appellants’ pleadings.

10. His Honour then addressed the Commonwealth’s submission that the proceedings should be summarily dismissed because of what was said to be the irreparable prejudice it would experience in defending the claims after such lengthy delays.  He rejected the Commonwealth’s contention, in substance for these reasons (at 598):

    “I have come to the conclusion that the present application, based on hardship, has been made prematurely.  The applicants have instituted their proceedings and, within reason, they are entitled to run their case as they see fit.
    …
    As the Court has earlier determined that it would not hear and determine the preliminary issues that were advanced by the Commonwealth, my assessment of the current position is that the Court cannot now assess the issues of the Commonwealth’s claim to have suffered irreparable prejudice without considering, at the same time, the issue of hardship to the applicants if their applications for extensions of time were to be refused.”

11. It is perhaps worth noting that substantial segments of his Honour’s judgment in Cubillo (No 1) are reproduced in the primary Judgment.  For example, a good deal of the material in the sections headed “Extension of Time” and “Hardship” in Cubillo (No 1) (at 580-598) appears with only editorial changes in the broadly equivalent sections of the primary Judgment [1308]-[1425].

    THE WITNESSES

12. In consequence of his Honour’s rulings in Cubillo (No 1) he proceeded to hear the evidence on the appellants’ substantive cases, as well as evidence directed to the prejudice sustained by the Commonwealth and to factors relevant to the appellants’ application for an extension of time.  It is not necessary for the purposes of the appeal to identify all the witnesses who gave evidence.  It is useful, however, to describe the categories of witnesses called by the parties to support their respective cases.  It is also convenient to identify persons who, by reason of death or infirmity, were unable to give evidence at the trial and who were regarded by the primary Judge as potentially significant witnesses.  The absence of these persons played an important part in the arguments at trial and on the appeal.

13. His Honour divided Mrs Cubillo’s witnesses into four groups.  The first comprised four elderly Aboriginal women whose evidence was directed mainly to the circumstances of the removal of the part-Aboriginal children, including the young Lorna Nelson, from the Phillip Creek Settlement.  Secondly, two witnesses were called who had also been removed as children from the Phillip Creek Settlement to the Retta Dixon Home.  Thirdly, other inmates of the Retta Dixon Home during Mrs Cubillo’s stay gave evidence as to conditions at the Home, including alleged acts of brutality directed at inmates.  The final group included expert witnesses in the fields of history, anthropology and psychiatry.

14. Mr Gunner’s witnesses addressed aspects of his life at Utopia Station and the circumstances prevailing at St Mary’s Hostel during his time there (including evidence of sexual molestation by staff members).  Mr Gunner also relied on expert evidence from a psychiatrist and anthropologist. 

15. The primary Judge identified three categories of witnesses for the Commonwealth.  The evidence of the first group related to the removal of Mrs Cubillo from the Phillip Creek Settlement and the conditions at the Retta Dixon Home while Mrs Cubillo was kept there.  Witnesses in this group included an inmate of the Home, persons engaged by the AIM to work at the Home and a welfare officer employed by the Northern Territory Administration.  It also included Mr Les Penhall, then a cadet patrol officer who drove the truck which transported the Phillip Creek children to the Retta Dixon Home, and Mr Desmond Walter, a former missionary posted to the Home from 1954 to 1955, whom Mrs Cubillo accused of having beaten her, thereby inflicting on her physical and emotional injuries.

16. The second group of witnesses for the Commonwealth gave evidence of Mr Gunner’s circumstances at Utopia Station and of the conditions prevailing at St Mary’s Hostel.  These witnesses included Sister Eileen Heath, who founded St Mary’s Hostel but left in 1955 to become a welfare officer in the Northern Territory Administration, and Captain Colin Steep, who was the warden at St Mary’s from January 1956 until November 1959.

17. The third group included former patrol officers and other officers of the Native Affairs Branch or the Welfare Branch of the Northern Territory Administration who gave evidence as to the policies and practices of the time in relation to part-Aboriginal children in the Northern Territory.  In addition, the Commonwealth called its own expert and medical evidence.  An instructing solicitor for the Commonwealth also filed affidavits concerning potential witnesses who were dead or could not be located.

18. In his judgment, the primary Judge identified a number of persons who had the potential to be “important” or “significant” witnesses but who had died before the trial or were otherwise unable to give helpful evidence [53]-[63].  These included the following:

    ·     The four successive Administrators of the Northern Territory during the period 1946 to 1961, all of whom could have given evidence as to the policies adopted during that period in relation to part-Aboriginal children in the Northern Territory.  All had died before the trial.

    · Mr Frank Moy, who was the Director of Native Affairs from 14 November 1946 until 21 May 1953 and who held office when Mrs Cubillo was removed from the Phillip Creek Settlement [55]-[57]. His Honour considered it curious that neither party “could produce a single document in respect of that removal” [56]. He was satisfied that Mr Moy “would have had some knowledge and some involvement in the removal of the children” but that, because of Mr Moy’s death, there was no way of finding out the details of his knowledge or involvement [1401].

    · Miss Amelia Shankelton, who was “directly involved” in taking Mrs Cubillo from the Phillip Creek Settlement to the Retta Dixon Home and was the Superintendent of the Home throughout the whole period of Mrs Cubillo’s residency [62]. Miss Shankelton died in 1990. His Honour considered that the absence of her evidence was a “huge gap” [1403].

    · Mr R K McCaffrey, who was the Acting Director of Native Affairs from 22 May 1953 to 25 November 1954. The primary Judge considered Mr McCaffrey to be a “potentially valuable witness” who might have been able to assist the Court with respect to the standards and operations of the Retta Dixon Home during the relevant time [1402].

    ·     Mr Harry Giese, who became Director of Native Affairs on 26 November 1954 and who continued in that position until 1963.  (The Native Affairs Branch was renamed the Welfare Branch upon the repeal of the Aboriginals Ordinance on 13 May 1957 and Mr Giese thereupon became the Director of Welfare.) His Honour noted that a substantial amount of written material prepared or approved by Mr Giese was in evidence, but that this was “no substitute for Mr Giese’s oral evidence” [58]. He found that Mr Giese had the potential to be a “most important witness” and that such evidence as he may have been able to give about Mr Gunner’s removal from Utopia had been lost. Mr Giese was alive at the time of the trial but was too infirm to give evidence.

    · All the District Welfare Officers or Acting District Welfare Officers who were stationed at Alice Springs during Mr Gunner’s stay at St Mary’s Hostel. According to his Honour, each had the potential to give important evidence as to how the Native Affairs Branch and later the Welfare Branch administered policy [61]. He mentioned in particular Mr Harry Kitching, who was personally involved in the events surrounding the removal of Mr Gunner from Utopia Station. Mr Kitching in fact gave evidence, but his memory of the events was confused. His Honour found that “that confusion ha[d] the potential to have an adverse impact on the Commonwealth in the preparation of its defence” [1404].

19. In later sections of the judgment, the primary Judge referred to other persons whose evidence might have shed light on important events, but who were dead or infirm. For example, when analysing the evidence relating to the removal of Mrs Cubillo from the Phillip Creek Settlement, his Honour noted that the evidence disclosed nothing about the role played by Mr Ivor Thomas, the missionary in charge of the Settlement, Mrs Thomas or Mr Colley, the resident school teacher. All had died [441].

    THE ORDERS

20. We refer later in this judgment to the reasoning of the primary Judge on the various issues raised by him, at least to the extent that they remain issues on the appeal.  At this point it is necessary only to note that the primary Judge made the following substantive order:

    “The [sic: Each] application for an extension of time under s 44(b) [sic: s 44(1)] of the Limitation Act 1981 (NT) is refused and each claim is dismissed.”

    (The order is reproduced in the report in the Australian Law Reports: Cubillo v Commonwealth (2000) 174 ALR 97, at 582. The order is not reproduced in the Federal Court Reports.)  His Honour also reserved any question of costs for further consideration.  We were informed that the primary Judge was not asked to make any order for costs.

21. The appellants filed their respective notices of appeal on 1 September 2000.  In doing so, they plainly proceeded on the assumption that the primary Judge’s judgment was final and that an appeal lay as of right to the Full Court.

22. The Commonwealth took the position, however, that the primary Judgment was interlocutory in character, since an order refusing an extension of time is interlocutory and not final.  Accordingly, on 24 October 2000, the Commonwealth filed a notice of motion seeking, inter alia, to strike out the appeal as incompetent. It maintained that by virtue of s 24(1A) of the Federal Court Act the appellants could not bring an appeal against the interlocutory judgment without the leave of the Court.

23. In order to guard against the possibility that the Commonwealth was right, the appellants filed their own motion seeking leave to appeal from the judgment.  They also sought an order extending the time for applying for leave to appeal, since the application for leave had not been filed within seven days from the pronouncement of the judgment as required by Federal Court Rules (“FCR”) O 52 r 10(2)(b) in the case of interlocutory judgments.

    THE LEGISLATION

24. In order to understand the judgment of the primary Judge and the issues at trial and on appeal it is necessary to set out the provisions of the legislation at the heart of the case.  In this section we deal with the Aboriginals Ordinance, the Welfare Ordinance 1953 (NT) and the limitations legislation in force in the Northern Territory, namely the 1866 Act and the Limitation Act.

    THE ORDINANCE MAKING POWER

25. The Commonwealth acquired exclusive jurisdiction over the Northern Territory in 1910: Northern Territory Acceptance Act 1910 (Cth). Section 13(1) of the Northern Territory (Administration) Act 1910 (Cth) (“Administration Act”) empowered the Governor-General to make Ordinances having the force of law in the Northern Territory, subject to a power of disallowance in each House of Parliament: see s 13(2), (3). The Administration Act provided for the Governor-General to appoint an Administrator for the Territory who was to perform the powers and functions of his office according to the tenor of his commission and according to instructions given by the Minister: s 4.

26. Until 1947, the powers of the Governor-General under the Administration Act remained substantially the same.  The Northern Territory (Administration) Act 1947 (Cth) amended the Administration Act to establish a Legislative Council, with power to make Ordinances for the peace, order and good government of the Territory: s 4U. Such Ordinances had no effect until assented to by the Administrator (s 4V) and the Governor-General had power to disallow any Ordinance within six months of the Administrator’s assent (s 4W). The Administrator was not to assent to any Ordinance relating to “Aboriginals or Aboriginal Labour” unless the Ordinance contained a clause suspending its operation until the signification of the Governor-General thereon (s 4Y(c)). See generally Kruger v The Commonwealth (1997) 190 CLR 1, at 49-50, per Dawson J; Northern Territory v GPAO (1999) 196 CLR 553, at 576-577, per Gleeson CJ and Gummow J.

    THE ABORIGINALS ORDINANCE 1918 (NT)

    The Provisions

27. The Governor-General made the Aboriginals Ordinance pursuant to s 13(1) of the Administration Act on 12 June 1918.  It came into force the following day.  The Aboriginals Ordinance repealed the Aboriginals Ordinance 1911 (NT) and also declared that the Northern Territory Aboriginals Act 1910 (SA), which had been continued in force by the Acceptance Act, ceased to apply to the Northern Territory. 

28. The Aboriginals Ordinance was repealed by the Welfare Ordinance 1953 (NT) (“Welfare Ordinance”), with effect from 13 May 1957.  It was therefore in force when Mrs Cubillo and Mr Gunner were removed in 1947 and 1956, respectively.  It was also in force throughout the period Mrs Cubillo was resident at the Retta Dixon Home and for the first year of Mr Gunner’s residence at St Mary’s Hostel.

29. Section 4 of the Aboriginals Ordinance, in its original form, provided for the appointment of a “Chief Protector of Aboriginals” by the Administrator.  The Chief Protector was to be “under the Administrator” and was to be “responsible for the administration and execution of this Ordinance”.  In 1939, the title of “Chief Protector of Aboriginals” was changed to “Director of Native Affairs”: see Aboriginals Ordinance 1939 (NT), ss 2, 3. The Administrator was also empowered by s 4 to appoint Protectors of Aboriginals, a title which survived the 1939 amendments. Section 4(4) of the Aboriginals Ordinance provided that the Director could, in relation to any matter or class of matters, delegate all or any of his powers and functions.

30. Section 3 of the Aboriginals Ordinance defined the word “Aboriginal” in terms reflecting the attitudes of the times.  The expression was defined to mean any person who was

    “(a)an aboriginal native of Australia or of any of the islands adjacent or belonging thereto; or

    (b)a half-caste who lives with an aboriginal native as wife or husband; or

    (c)a half-caste, who, otherwise than as the wife or husband of such an aboriginal native, habitually lives or associates with such aboriginal natives; or

    (d)a half-caste male child whose age does not apparently exceed eighteen years; or

    (e)a female half-caste not legally married to a person who is substantially of European origin or descent and living with her husband.”

    The term “half-caste” was defined, in a circular fashion, to mean

    “…any person who is the offspring of parents, one but not both of whom is an aboriginal and includes any person one of whose parents is a half-caste.”

    Although his Honour does not appear to have made a formal finding concerning the application of these definitions to Mrs Cubillo in July 1947, the time of her removal from the Phillip Creek Settlement, there seems to be no doubt that she fell within pars (c) and (e) of the definition of “Aboriginal” in force at that time.

1. The Aboriginals Ordinance (No 2) 1953 (NT) (the “1953 Ordinance”), which came into force on 1 October 1953, removed all references to “half-castes” in the Aboriginals Ordinance and substituted a new definition of “Aboriginal”: see ss 3, 5, 7, 8, Schedule. The new definition was as follows:

   “(a)     a person who is an aboriginal native of Australia...;

   (b)a person who lives after the manner of, follows, adheres to or adopts the customs of persons described in paragraph (a) of this definition and at least one of whose ancestors was a person described in that paragraph;

   (c)a person, being under the age of eighteen years, at least one of whose ancestors was a person described in paragraph (a) of this definition, and:

   (i)whose care, custody, or control has been undertaken by the Director under section six of this Ordinance before the date when the Aboriginals Ordinance (No 2) 1953 comes into operation; or

   (ii)whom the Director has caused to be kept in a reserve or an aboriginal institution under section sixteen of this Ordinance, before the date when the Aboriginals Ordinance (No 2) 1953 comes into operation; or

   (d)…”.

   One consequence of the 1953 Ordinance was that part-Aboriginal people who formerly were “Aboriginals” because they were so-called “half-castes” were now no longer necessarily within the amended definition of “Aboriginal”.

2. The primary Judge found that Mrs Cubillo came within par (c) of the amended definition of “Aboriginal” [140]. He made this finding because at the time she was under the age of eighteen; one of her ancestors was an Aboriginal native of Australia; and an order of committal had been made on 18 August 1953 pursuant to ss 6 and 16 of the Aboriginals Ordinance committing her to the Retta Dixon Home until 8 August 1956, the date thought to be her eighteenth birthday.  His Honour did not specify the date from which Mrs Cubillo came within the definition but presumably he took the view that it was on 1 October 1953, the date of commencement of the 1953 Ordinance.

3. His Honour found that Mr Gunner, whose removal from Utopia Station did not occur until 1956, came within par (b) of the 1953 definition, as his mother was an Aboriginal native of Australia and he was a person living “after the manner of” persons who were Aboriginal natives of Australia [1140]. Although his Honour did not expressly say so, that finding was presumably limited to the time Mr Gunner was living at Utopia Station, prior to his removal to St Mary’s Hostel. However, on 20 February 1957 a declaration was made by the Director of Native Affairs pursuant to s 3A of the Aboriginals Ordinance, declaring that Mr Gunner was deemed to be an Aboriginal within the meaning of the Aboriginals Ordinance.  Section 3A, which was amended by s 4 of the 1953 Ordinance, provided that such a declaration could be made if, inter alia, the Director considered it in the best interests of the person concerned: s 3A(1)(b). Previously, s 3A had given the Director an unfettered discretion to grant exemption certificates to Aboriginals, removing them in whole or in part from the controls imposed by the Aboriginals Ordinance.

4. Section 5(1) of the Aboriginals Ordinance empowered the Director of Native Affairs (formerly the Chief Protector):

   “(a)to apportion, distribute, and apply, as seems most fit, under the direction of the Administrator, the moneys at his disposal for the purpose of carrying out this Ordinance;

   (b)to distribute blankets, clothing, provisions, and other relief or assistance to the aboriginals;

   (c)to provide, as far as practicable, for the supply of food, medical attendance, medicines, and shelter for the sick, aged and infirm aboriginals;

   (d)to provide, when possible, for the custody, maintenance, and education of the children of aboriginals;

   (e)to manage and regulate the use of all reserves for aboriginals; and

   (f)to exercise a general supervision and care over all matters affecting the welfare of the aboriginals, and to protect them against immorality, injustice, imposition and fraud.”

5. Section 6(1) of the Aboriginals Ordinance, prior to the 1953 amendments, provided  as follows:

   “(1)  The Director shall be entitled at any time to undertake the care, custody, or control of any aboriginal or half-caste if, in his opinion it is necessary or desirable in the interests of the aboriginal or half-caste for him to do so, and for that purpose may enter any premises where the aboriginal or half-caste is or is supposed to be, and may take him into his custody.”

   Section 6(2) required any person “on whose premises an aboriginal or half-caste is”, on demand by or on behalf of the Director, to facilitate by all reasonable means within his power the taking into custody of the aboriginal or half-caste. The 1953 amendments removed the references to “half-caste” in s 6 of the Aboriginals Ordinance (see [43] above).

6. Section 7(1) of the Aboriginals Ordinance, in its pre-1953 form, provided as follows:

   “(1)  The Director shall be the legal guardian of every aboriginal and of every half-caste child, notwithstanding that the child has a parent or other relative living, until the child attains the age of eighteen years, except while the child is a State child within the meaning of the Act of the State of South Australia in force in the Northern Territory entitled The State Children Act 1895, or any Act of that State or Ordinance amending or substituted for that Act.”

7. The 1953 Ordinance repealed and replaced s 7 with a simpler provision, as follows:

   “7.      The Director is the legal guardian of all aboriginals”.

8. Section 13(1) of the Aboriginals Ordinance empowered the Administrator to declare any mission, school, home or other privately supported institution to be an “aboriginal institution for the maintenance, custody, and care of aboriginal and [before 1953] half-caste children”. Any such declaration was to name some person as the Superintendent of the aboriginal institution: s 13(2). The Administrator was empowered to revoke any declaration made under s 13(1): s 13(3). Section 13(6) of the Aboriginals Ordinance, in its pre-1953 form, provided as follows:

   “(6)     Every aboriginal and half-caste child for the time being an inmate of any aboriginal institution shall be under the control and supervision of the Superintendent.”

9. As the primary Judge observed [142], s 13 of the Aboriginals Ordinance conferred a power on the Director of Native Affairs that was independent of the power conferred by s 6. The purpose of s 13 was to provide for the creation of “aboriginal institutions” which were then subject to other provisions of the legislation such as s 14, authorising the Administrator to grant leases of Crown Lands to Aboriginal institutions. The Director could undertake the care, custody or control of an Aboriginal child pursuant to s 6 (in the circumstances specified in that provision) and, having done so, could place the child in an Aboriginal institution.

10. Section 15 of the Aboriginals Ordinance gave a Protector power to approve the removal of Aboriginals or half-castes. Section 15, so far as relevant, in its pre-1953 form, provided as follows:

    “(1)     A Protector may if he thinks fit give authority in writing to any person so desiring it for the removal of any aboriginal, or any female half-caste, or any half-caste male child under the age of eighteen years, from one district to another, or from any reserve or aboriginal institution to another reserve or aboriginal institution, or to any place beyond the Northern Territory.
    …

    (4)      Any person who, without the authority in writing of a Protector, removes or causes to be removed any aboriginal or any female half-caste or any half-caste child under the age of eighteen years from one district to another, or to any place beyond the Northern Territory, shall be guilty of an offence against this Ordinance.”

11. Section 16(1) of the Aboriginals Ordinance gave the Director important powers in relation to Aboriginals on reserves or in Aboriginal institutions. Section 16(1), in its pre-1953 form, provided as follows:

    “(1)     The Director may cause any aboriginal or half-caste to be kept within the boundaries of any reserve or aboriginal institution or to be removed to and kept within the boundaries of any reserve or aboriginal institution, or to be removed from one reserve or aboriginal institution to another reserve or aboriginal institution, and to be kept therein.”

    Any Aboriginal or half-caste who refused or resisted removal or who refused to remain within a reserve or aboriginal institution was guilty of an offence: s 16(2). Section 16(3) excluded from the scope of s 16(1) any Aboriginal or ‘half-caste’:

    “(a)   who is lawfully employed by any person; or

    (b)who is the holder of a permit to be absent from the reserve or   aboriginal institution in question; or

    (c)who is a female lawfully married to and residing with a husband who is substantially of European origin or descent; or

    (d)for whom, in the opinion of the Director, satisfactory provision is otherwise made.”

    Case Law

12. In Kruger v The Commonwealth (1997) 190 CLR 1, a challenge was made to the constitutional validity of ss 6, 7 and 16 of the Aboriginals Ordinance.  The attack included contentions that the provisions infringed implied constitutional rights to freedom of movement and association, an implied constitutional immunity from detention without due process and an implied constitutional guarantee of legal equality. In rejecting the constitutional challenge (Gaudron J dissenting), the members of the High Court addressed aspects of the construction of ss 6, 7 and 16.

13. Brennan CJ observed (at 35) that the power in s 6 was conditioned upon the Director’s opinion that “it [was] necessary or desirable in the interests of the Aboriginal or half-caste for him to do so”. According to the Chief Justice (at 35-36):

    “This is a power which in terms is conferred to serve the interests of those whose care, custody or control might be undertaken.  It is not a power to be exercised adversely to those individual interests”.

    His Honour also said (at 37) that s 7 of the Aboriginals Ordinance was a law calculated to advance the interests of the “Aboriginals and half-castes of the Northern Territory”.

14. The Chief Justice pointed out (at 36) that a power which is to be exercised in the interests of another may be misused and commented that:

    “[r]evelations of the ways in which the powers conferred by the Ordinance were exercised in many cases has profoundly distressed the nation”.

    Nonetheless, he noted that “the susceptibility of a power to its misuse is not an indicium of its invalidity”.  Brennan CJ also addressed (at 36-37) the need for the discretionary power to be exercised reasonably.  He did so in these terms:

    “[W]hen a discretionary power is statutorily conferred on a repository, the power must be exercised reasonably, for the legislature is taken to intend that the discretion be so exercised.  Reasonableness can be determined only by reference to the community standards at the time of the exercise of the discretion and that must be taken to be the legislative intention.  Therefore, it would be erroneous in point of law to hold that a step taken in purported exercise of a discretionary power was taken unreasonably and therefore without authority if the unreasonableness appears only from a change in community standards that has occurred since the step was taken.”

15. The Chief Justice took the view (at 37) that s 16 was a provision of a different kind. On its face it was not simply intended to serve the interests of the persons over whom the power might be exercised. He quoted with approval comments made by Fullagar J in Waters v The Commonwealth (1951) 82 CLR 188, at 194-195. In that case the plaintiff, an “Aboriginal” within the “Aboriginals Ordinance”, sought relief in respect of what he claimed was unlawful detention. He had been taken into custody and removed to a reserve in pursuance of an order made by the Director of Native Affairs under ss 6 and 16 of the Aboriginals Ordinance, because of his involvement in a “protest strike” and other industrial action on an Aboriginal reserve: see at 195.  One of the arguments advanced by the plaintiff was that the statutory powers had not been exercised bona fide for any purpose for which they were conferred.  The passage from Fullagar J’s judgment quoted by Brennan CJ is this:

    “The powers which the Director wields are vast, and those over whom he wields them are likely often to be weak and helpless.  His responsibility is heavy.  When he acts, every presumption has to be made in his favour. He must often act on his own opinion in circumstances of difficulty, and no court can substitute its opinion for his.  But, on the other hand, the courts must be alert to see that, if that which is not expected does happen and he does mistake or abuse his power, the mistake or abuse does not go either undetected or unredressed.  The material before me in this case, however, fails completely, in my opinion, to make a prima facie case of abuse of power.

    It was argued that, both under s 6 and under s 16, the only consideration which should affect the discretion of the Director was the welfare of the particular Aboriginal concerned.  This may be so under s 6, but, so far as s 16 is concerned, it is, in my opinion, by no means the only legitimate consideration.  Unlike s 6, s 16 contains no reference to the formation of any particular opinion on the part of the Director.  The discretion given is in terms absolute.  I have no intention, on such an application as this, of laying down any rules for the guidance of the Director.  But I think I should say that, in my opinion, he may legitimately take into consideration a number of other factors in addition to the welfare of the particular Aboriginal concerned, and that these include the welfare of other Aboriginals and the general interests of the community in which the particular Aboriginal dwells.”

16. Other members of the Court in Kruger expressed the view that the Aboriginals Ordinance was intended to have a “welfare” purpose.  Both Dawson and Toohey JJ referred to the legislative antecedents of the Ordinance in order to support this view, although their views as to the origins of the legislation were not identical: see at 52, per Dawson J; at 76, per Toohey J.  Dawson J (with whom McHugh J agreed) observed (at 51-2) that

    “whilst s 16 did not contain any explicit requirement that the powers which it conferred were to be exercised for the welfare of Aboriginals or ‘half-castes’, it is clear enough that it was so circumscribed.”

    Gummow J thought (at 162) that the powers of the Director were

    “reasonably capable of being seen as necessary for a legitimate non-punitive purpose (namely the welfare and protection of those persons [liable to be taken into custody and care]”.

    See also at 76-77, 85, per Toohey J; cf at 129-130 per Gaudron J (dissenting). It is not entirely clear whether there was any substantial difference between Brennan CJ’s approach to s 16 and that of Dawson and Gummow JJ. (For criticism of the approach to the construction of the Aboriginals Ordinance in Kruger, see J Clarke, Case Note (Cubillo v Commonwealth) (2001) 25 Melb Uni LR 218, at 222-224.)

17. Reference should also be made to the decision of Kriewaldt J of the Supreme Court of the Northern Territory in Ross v Chambers (unreported, 5 April 1956). The issue in that case was whether Aboriginals of full age could sue in their own names, having regard to the terms of s 7 of the Aboriginals Ordinance in its post-1953 form.  Kriewaldt J held that s 7 did not prevent the plaintiffs proceeding without naming a next friend.  His Honour rejected the defendant’s argument that s 7 was intended to equate, in every respect, the position of an adult aboriginal qua the Director to the position of an infant ward qua his or her guardian.

18. Kriewaldt J pointed out that guardians of infants are generally entitled to the legal care and custody of their wards.  His Honour continued:

    “[C]ustody includes the right to determine the place of residence of the ward.  Can it be suggested that since 1953 the Director can, as a matter of course determine the place of residence of every adult aboriginal in the Territory?  If section 7 requires an affirmative answer, then the section operated to repeal section 16 which restricts the right of the Director to determine the residence of aboriginals if the aboriginal is lawfully employed, or if the aboriginal is a female lawfully married to a white person.”

19. Kriewaldt J considered that there were further reasons supporting his construction of s 7. These included the language of s 5(1)(d) and (f) which

    “points to the custody of infant aboriginals being normally elsewhere than in the Director and derogates from the argument that section 7 gives to him perpetual custody of all aboriginals, infant or adult.”

    His Honour pointed out that s 6 presupposed that the Director was not in law at all times possessed of the custody of every aboriginal and ss 15 and 16 would not have been necessary if the Director were a guardian “to the fullest extent”. He concluded that s 7 was not intended to create a new status for aboriginals differing from that which the earlier legislation had created.

20. It should be noted that in Ross v Chambers, Kriewaldt J expressed the tentative view, obiter, that the word “aboriginal” was used in s 7(1) in its pre-1953 form as an adjective and that, accordingly, the sub-section was intended to refer only to half-caste and Aboriginal children.  His Honour acknowledged, however, that the contrary view seemed to have been taken by Fullagar J in Waters v The Commonwealth (1951) 82 CLR 188, at 193. In Kruger v The Commonwealth, the question of construction was not adverted to expressly, but the judgments appear to assume that s 7(1) was not confined in the manner suggested by Kriewaldt J.

21. In Kruger v The Commonwealth only Dawson J referred to Ross v Chambers.  Dawson J merely observed (at 52) that the “precise scope of s 7…is far from clear as was recognised…in Ross v Chambers” and recorded Kriewaldt J’s view that the guardianship for which the section provided could not, as regards adult Aboriginals, embrace all the incidents which normally attach to the relationship of guardian and ward.

    THE WELFARE ORDINANCE 1953 (NT)

    The Provisions

22. The Welfare Ordinance came into force on 13 May 1957.  By that date, Mrs Cubillo had left the Retta Dixon Home.  The Welfare Ordinance is therefore relevant only to Mr Gunner’s position. He, of course, remained in St Mary’s Hostel until 1963.

23. The Director of Welfare was appointed by the Minister and was responsible, under the Administrator, for the administration of the Welfare Ordinance: s 7(1). The Director’s duties were set out in s 8. They included the following:

    “(a)     in relation to wards, to take steps –

    (i)to promote their social, economic and political advancement for the purpose of assisting them and their descendants to take their place as members of the community of the Commonwealth;

    (ii)to arrange as far as is practicable for the education of wards…;

    (iii)to promote their physical well being, to inculcate proper habits of hygiene and sanitation and to improve their standards of nutrition and housing;

    (iv)to detect, prevent and cure disease…;

    (v)to arrange for their vocational training and to obtain suitable employment for them in industrial and other enterprises…;

    (vi)to provide such relief and assistance as is necessary or appropriate; and

    (vii)to exercise a general supervision and care over matters affecting their welfare;

    (b)…;

    (c)to supervise and regulate the use and management of institutions, other than institutions established by the Commonwealth;

    (d)to control the management of institutions established by the Commonwealth;

    (e)to supervise and regulate the use and management of reserves;

    (f)…”.

    The Director was empowered to delegate all or any of his powers, functions and authorities under the Welfare Ordinance: s 10(1).

1. The appellants pleaded that the fiduciary relationship between them and the Commonwealth arose from a variety of circumstances.  The primary Judge summarised the circumstances relied on by the appellants as follows [1276]:

   “The fiduciary relationship…was said to arise because of the role and functions of the Commonwealth’s servants and agents in the removal and detention of the [appellants] and because of the Commonwealth’s powers over, and its assumption of responsibility for, Aboriginal people in the Northern Territory.  It was also said to arise because of the powers, obligations and discretions of the Directors and the vulnerability of each [appellant] to the exercise of those powers and discretions…”.

2. The appellants identified the fiduciary duties allegedly owed to them by the Commonwealth in general terms.  The duties were said to include a duty properly to supervise any institution or person into whose care the appellants were placed and a duty to advise the appellants to obtain independent legal advice.

3. The appellants pleaded that the Commonwealth, in removing and detaining them, had acted in breach of its fiduciary duties.  The particulars of breach largely reproduced the particulars of the breaches of duty of care alleged against the Directors in their capacity as guardians of the appellants.  In addition, however, the appellants contended that the interests of the Commonwealth conflicted with the appellants’ interests, in two respects:

   (i)The interests of the Commonwealth in destroying the appellants’ family and cultural associations and connections, providing domestic and manual labour for the European community and breeding out “half-caste” Aboriginal people conflicted with the appellants’ interests in maintaining their association with their families and culture, achieving recognition of traditional land rights and avoiding psychological harm.

   (ii)The interests of the Commonwealth in not being exposed to legal action by the appellants conflicted with the appellants’ interests in being in a position to pursue legal or equitable remedies against the Commonwealth. 

4. The appellants also pleaded that the Directors owed them fiduciary duties.  The fiduciary relationship was said to arise, inter alia, from the role performed by the Directors of Native Affairs and Welfare as legal guardians of the appellants to s 7 of the Aboriginals Ordinance and s 24 of the Welfare Ordinance.  The appellants alleged that the Directors breached their fiduciary obligations to the appellants in substantially the same respects as the Commonwealth.  Of course, the Directors were not parties to the proceedings, but the Commonwealth was alleged to have knowingly participated in the Directors’ breaches of fiduciary duty.

   THE PRIMARY JUDGMENT ON FIDUCIARY DUTIES

5. The primary Judge found that the first ground of alleged conflict of interest (in which the Commonwealth was said to have an interest in destroying the appellants’ cultural and family associations) lacked evidentiary support [1305], [1306].  There is no appeal from that finding.

6. His Honour rejected the second ground of alleged conflict of interest (based on the failure of the Commonwealth or the Directors to advise the appellants of their legal rights). He said that this argument had fallen by the wayside because of his “factual findings that the [appellants had] failed to prove that any of their rights were infringed” [1289].

7. So far as the existence of fiduciary duties was concerned, the primary Judge observed that in Bennett v Minister of Community Welfare (1992) 176 CLR 408 at 411, Mason CJ, Deane and Toohey JJ had recognised that the relationship of guardian and ward created a fiduciary relationship. Similarly, he referred to the observation of the Full Court in Paramasivam v Flynn, at 504, that:

   “[a] relationship such as that of…guardian and ward may give rise to duties typically characterised as fiduciary – not to allow duty and interest to conflict and not to make an unauthorised profit within the scope of the relationship…”.

   His Honour concluded, however, that it would be inappropriate for a Judge at first instance to expand the range of fiduciary relationships to accommodate conflicts of interest which did not include “an economic aspect”.  He pointed out that in Paramasivam v Flynn the Full Court had rejected a contention that alleged sexual assault on a ward by a male guardian could constitute a breach of fiduciary duty. The Court had taken this view because the interest the former ward sought to vindicate was non-economic in character [1307].

8. Since the primary Judge had rejected the appellants’ substantive claims insofar as they were founded on breach of fiduciary duty it was not strictly necessary for him to address the Commonwealth’s contention that the appellants’ claim for equitable compensation for breach of fiduciary duty had been barred by the equitable defence of laches. Nevertheless, consistently with his Honour’s approach to the appellants’ applications for extensions of time in relation to the common law causes of action, the primary Judge did address the question of laches. In this respect, it was common ground that the Northern Territory limitations legislation, unlike the law in some other jurisdictions, does not prescribe a limitation period for a claim for equitable compensation founded on breach of fiduciary duty: cf s 11(1) of the Limitation Act 1985 (ACT), discussed in Paramasivam v Flynn, at 501. 

9. His Honour commenced his relatively brief analysis of laches by quoting from the leading authority, Lindsay Petroleum Co v Hurd (1874) LR 5 PC 221. That case had been recognised by Deane J in Orr v Ford (1989) 167 CLR 316, at 341, as establishing the “ultimate test”

   “whether the plaintiff has, by his inaction and standing by, placed the defendant or a third party in a situation in which it would be inequitable and unreasonable ‘to place him if the remedy were afterwards to be asserted’.”

10. His Honour accepted that, since the Northern Territory legislature had not prescribed a limitation period for equitable relief, considerations such as the public interest in bringing litigation to an end within a specified time did not have the same significance as they might in connection with an application to extend time for the institution of proceedings to establish common law claims.  He also rejected the Commonwealth’s contention that it had been prejudiced by knowing delay or neglect on behalf of the appellants, as distinct from delay attributable to their ignorance of material facts and of their legal rights. 

11. The primary Judge said that the question was one of doing justice between the parties.  If, contrary to his findings, there were fiduciary relationships between the Commonwealth or the Directors and the appellants and if (also contrary to his findings) the appellants had claims for equitable relief against the Commonwealth, his Honour considered that

    “it would be grossly unfair to let that case proceed.  In the case of Mrs Cubillo, the Commonwealth does not have access to the witnesses and the evidentiary material it would need to mount its defence.  In the case of Mr Gunner, three of the Commonwealth’s most important witnesses, Mr Giese, Mr Kitching and Mrs McLeod were either not available or their memories were badly affected by the passage of time” [1433].

    For these reasons, the primary Judge would have barred the appellants’ claims for equitable relief.

    THE SCOPE OF FIDUCIARY DUTIES

12. As the primary Judge recognised, the Director owed fiduciary obligations to the appellants by virtue of his statutory role as their legal guardian.  His Honour was correct to do so.  In Clay v Clay (2001) 178 ALR 193, judgment in which was delivered after the primary judgment in this case, the High Court characterised (at 205) the relationship of guardian and ward as “a fiduciary relationship with particular characteristics”. See Countess of Bective v Federal Commissioner of Taxation (1932) 47 CLR 417, at 420-421, per Dixon J. The fact that the Director became the legal guardian of the appellants by virtue of statute is no obstacle to the creation of a fiduciary relationship: Wik Peoples v Queensland (1996) 187 CLR 1, at 90, per Brennan CJ.

13. The Commonwealth was not, however, the appellants’ guardian.  Whether or not the Commonwealth owed fiduciary duties to the appellants, as their pleadings acknowledged, depended on other considerations.   The primary judge appears not to have made a finding as to whether there was a fiduciary relationship between the Commonwealth and the appellants.  Although there are statements in the section of the judgment dealing with laches that suggest that his Honour had found that there was no such relationship, it is clear enough that this was not the effect of his earlier reasoning.  The primary Judge proceeded on the basis that, if there was a fiduciary relationship between the Commonwealth and the appellants, the Commonwealth had not breached its fiduciary duties.

14. Even if the Commonwealth did owe fiduciary duties to the appellants, that was merely the beginning of the inquiry.  The point emerges from the reasoning of the joint judgment (McHugh, Gummow, Hayne and Callinan JJ) in Pilmer v Duke Group Ltd (in liq) (2001) 180 ALR 249, a case involving an alleged breach of fiduciary duty by an accounting firm in respect of a valuation. Their Honours explained the distinctive character of the fiduciary obligation which sets it apart from contract and tort by approving the analysis of McLachlin J in Norberg v Wynrib [1992] 2 SCR 226, at 272:

    “The foundation and ambit of the fiduciary obligation are conceptually distinct from the foundation and ambit of contract and tort.  Sometimes the doctrines may overlap in their application, but that does not destroy their conceptual and functional uniqueness.  In negligence and contract the parties are taken to be independent and equal actors, concerned primarily with their own self-interest.  Consequently, the law seeks a balance between enforcing obligations by awarding compensation when those obligations are breached, and preserving optimum freedom for those involved in the relationship in question.  The essence of a fiduciary relationship, by contrast, is that one party exercises power on behalf of another and pledges himself or herself to act in the best interests of the other.”

    The joint judgment in Pilmer v Duke Group also endorsed (at 271) a passage from the judgment of Frankfurter J in Securities and Exchange Commission v Chenery Corporation 318 US 80 (1943), at 85-86:

    “But to say that a man is a fiduciary only begins analysis; it gives direction to further inquiry.  To whom is he a fiduciary?  What obligations does he owe as a fiduciary?  In what respect has he failed to discharge these obligations?  And what are the consequences of his deviation from duty?”

    It follows that the fact that one person is in a fiduciary relationship with another does not mean that all aspects of their relationship are necessarily governed by equitable principles: Breen v Williams (1996) 186 CLR 71, at 92, per Dawson and Toohey JJ.

15. On the appellants’ case, the fiduciary duties owed by the Commonwealth and the Directors were largely co-extensive with the scope of the Commonwealth’s duty of care to the appellants.  So, too, the alleged breaches of fiduciary duty were largely co-extensive with the alleged breaches of the Commonwealth’s duty of care.  Indeed, the appellants conceded that the evidence they relied on to establish breaches of fiduciary duty was “essentially…the same evidence as [was] relied on for the breaches of the duty of care”.  As the reasoning in Pilmer v Duke Group suggests, Australian law has set its face firmly against the notion that fiduciary duties can be imposed on relationships in a manner that conflicts with established tortious and contractual principles.

16. In Breen v Williams, one issue was whether the doctor-patient relationship imposed a fiduciary duty on the doctor to grant the patient access to his or her medical records.  Dawson and Toohey JJ said this (at 93):

    “[T]he duty of the doctor is established both in contract and in tort and it is appropriately described in terms of the observance of a standard of care and skill rather than, inappropriately, in terms of the avoidance of a conflict of interest….  The concern of the law in a fiduciary relationship is not negligence, or breach of contract.  Yet it is the law of negligence and contract which governs the duty of a doctor towards a patient.  This leaves no need, or even room, for the imposition of fiduciary obligations.”

    Gaudron and McHugh JJ also rejected (at 110) the contention that the doctor owed the patient (Mrs Breen) a fiduciary duty to give her access to the medical records:

    “She seeks to impose fiduciary obligations on a class of relationship which has not traditionally been recognised as fiduciary in nature and which would significantly alter the already existing complex of legal doctrines governing the doctor-patient relationship, particularly in the areas of contract and tort.  As Sopinka J remarked in Norberg v Wynrib [1992] 2 SCR 226, at 272: ‘Fiduciary duties should not be superimposed on these common law duties simply to improve the nature or extent of the remedy’.”

    (The passage from Sopinka J’s judgment was again quoted with approval in Pilmer v Duke Group, at 270.)  Gaudron and McHugh JJ also made this observation in Breen v Williams (at 113):

    “In this country, fiduciary obligations arise because a person has come under an obligation to act in another’s interests.  As a result, equity imposes on the fiduciary proscriptive obligations – not to obtain any unauthorised benefit from the relationship and not to be in a position of conflict.  If these obligations are breached, the fiduciary must account for any profits and make good any losses arising from the breach.  But the law of this country does not otherwise impose positive legal duties on the fiduciary to act in the interests of the person to whom the duty is owed.”

    (This passage, too, was quoted with approval in Pilmer v Duke Group, at [74].)

17. Breen v Williams was applied by a Full Court of this Court in Paramasivam v Flynn.  In that case, the appellant sought an extension of time to commence proceedings against the respondent, formerly his guardian, in respect of sexual assaults said to have occurred when he was a child.  His statement of claim pleaded that the assaults were committed in breach of the respondent’s fiduciary duties to him.  The Full Court concluded (at 507) that the fiduciary claim was “most unlikely to be upheld by Australian courts”.  One reason given for this conclusion was that the appellant’s claim was encompassed by tortious principles (at 505):

    “To say of a claim that it is a novelty is not necessarily to condemn it or to require the conclusion that it cannot succeed….  But an advance must be justifiable in principle. Here, the conduct complained of is within the purview of the law of tort, which has worked out and elaborated principles according to which various kinds of loss and damage, resulting from intentional or negligent wrongful conduct, are to be compensated.  That is not a field on which there is any obvious need for equity to enter and there is no obvious advantage to be gained from equity’s entry upon it.  And such an extension would, in our view, involve a leap not easily to be justified in terms of conventional legal reasoning.”

    Insofar as the appellants’ case on fiduciary duties is co-extensive with their case on breach of duty of care, it faces two insurmountable obstacles.  The first is that the primary Judge made findings adverse to the appellants which undercut their claims.  For example, the primary Judge was not satisfied that the removal and detention of Mrs Cubillo was not authorised by the Aboriginals Ordinance.  Any fiduciary obligation must accommodate itself to the terms of statute.  In particular, a fiduciary obligation cannot modify the operation or effect of statute: to hold otherwise, would be to give equity supremacy over the sovereignty of Parliament: Tito v Waddell (No 2) [1977] Ch 106, at 139. It follows that if the removal and detention of Mrs Cubillo had been authorised by the Aboriginals Ordinance, no fiduciary obligation could forbid what the legislation permitted.  In the case of Mr Gunner, the primary Judge found that he had been removed from Utopia Station at the request and with the informed consent of his mother and that the Director had not participated in the removal.  This finding leaves no room for Mr Gunner’s claim that his removal was in breach of fiduciary duties owed to him by the Commonwealth.

18. The second obstacle is that, in any event, the appellants’ claims are, to use the language of Paramasivam v Flynn, within the purview of the law of torts.  As the High Court has held, there is no room for the superimposition of fiduciary duties on common law duties simply to improve the nature and extent of the remedies available to an aggrieved party.  If it had been the case that the removal and detention of the appellants were not authorised by the Ordinances (or otherwise justified by law), those who caused the removal or detention would be guilty of tortious conduct and liable at common law.  There would be no occasion to invoke fiduciary principles.

    THE ALLEGED CONFLICT OF INTEREST AND DUTY

19. The only instance of conflict of interest and duty relied on by the appellants in the appeal was the alleged failure of the Commonwealth to advise the appellants of their legal rights or to advise them to obtain independent legal advice in relation to their rights.  The appellants submitted that the primary Judge’s dismissal of this argument, by reason of his factual findings that the appellants had failed to prove that any of their legal rights had been infringed, “misconceive[d] the nature of the breach”.

20. Yet the appellants appeared to concede that if the primary Judge was correct in concluding that no rights were infringed, the consequence would be that any breach of fiduciary duty would have caused the appellants no loss.  Since we have upheld his Honour’s findings rejecting the appellants’ claims based on breach of duty and false imprisonment, it follows that his Honour was correct in concluding that any breach of fiduciary duty could not have caused the appellants any loss that could be the subject of equitable compensation.

21. The appellants did not address argument in support of the proposition that, despite the fact that the particular breach of fiduciary duty caused no compensable loss, declaratory relief should nonetheless be granted.  No such relief was sought or foreshadowed on the Notices of Appeal.  In these circumstances, there is no basis for granting any relief in respect of this alleged breach of fiduciary duty.

    LACHES

22. The appellants did not challenge the primary Judge’s statement of the test to determine whether a claim for equitable compensation for breach of fiduciary duty is barred by the equitable defence of laches.  Their submissions were confined to a challenge to his Honour’s finding that if, contrary to his views, the appellants had a claim for breach of fiduciary duty it would be “grossly unfair” to allow the claim to proceed.  That challenge was made simply by way of assertion and was not developed.

23. The primary Judge dealt relatively briefly with the question of prejudice in the context of laches because he had addressed the issues at length earlier in his judgment. Since the claims founded on breach of fiduciary duty were largely co-extensive with the other claims, the findings of prejudice were directly relevant to the question of whether the equitable claims had been barred [1432]. We see no error in his Honour’s approach.

    DAMAGES

24. Submissions were made on behalf of the appellants that the primary Judge’s assessment of damages in each case, assuming liability to have been established, was too low. It is not necessary for us to address those submissions.

    CONCLUSION

1. The primary Judge dismissed the appellants’ claims on two principal alternative bases.  First, he rejected their common law, statutory and equitable claims on the evidence presented to him.  Secondly, having regard to the prejudice sustained by the Commonwealth having to defend the proceedings so many years after the relevant events occurred, he declined to grant the extension of time the appellants required in order to commence the proceedings to pursue their common law claims.  He also upheld the Commonwealth’s defence to the appellants’ equitable claims on the basis of laches.

2. As we have explained, the case presented by the appellants on the appeal was more limited and, in some respects, quite different from the contentions put to the primary Judge.  Although we have not agreed with all aspects of the primary Judge’s reasoning, we have found no appellable error in the conclusions he reached.  We have also taken the view that the appellants should not be permitted to recast their breach of duty claims on appeal.  To do so would be unjust.  Accordingly, the appeals must each be dismissed.

3. We were asked by the parties to reserve the costs of the appeal.  Accordingly, we shall give the parties an opportunity to make submissions as to costs.

I certify that the preceding four hundred and seventy five (475) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices SACKVILLE, WEINBERG & HELY .

Associate:

Dated:            31 August 2001

Counsel for the Appellants:	Mr J T Rush QC with Mr M A Dreyfus QC and Ms M Richards
Solicitors for the Appellants:	Holding Redlich
Counsel for the Respondent:	Mr D R Meagher QC with Dr M Perry and Ms C Beaton-Wells
Solicitor for the Respondent:	Australian Government Solicitor
Dates of Hearing:	15, 16, 17, 18, 21 and 22 May 2001
Date of Judgment:	31 August 2001