Davey, A.B. v Crean, S., Minister of Primary Industry & Energy

[1993] FCA 188

Re: ALBERT BRUCE DAVEY; IAN BRUCE DAVEY and BERARDINO FITTI
And: SIMON CREAN, MINISTER OF PRIMARY INDUSTRY AND ENERGY and AUSTRALIAN
FISHERIES MANAGEMENT AUTHORITY
No. NG149 of 1993
FED No. 188
Number of pages - 5
Constitutional Law
(1993) 113 ALR 335
(1993) 41 FCR 342

COURT

IN THE FEDERAL COURT OF AUSTRALIA

NEW SOUTH WALES DISTRICT REGISTRY
GENERAL DIVISION
Heerey J(1)

CATCHWORDS

Constitutional Law (cth) - s.51(xxxi) - acquisition of property on just terms - Northern Prawn Fishery Management Plan - provision in Plan for reduction of units of fishing capacity - whether provision for compensation expressed to be conditional on finding that there has been an acquisition of property valid.

Constitutional Law (cth) - separation of powers - whether plan vests legislative power in a court by conferral of advisory function.

Commonwealth Constitution s.51(xxxi).

Northern Prawn Fishery Management Plan 1989 par 20B(11)(12).

Fitti v The Minister for Primary Industries and Energy and Anor. (unreported, O'Loughlin J, Federal Court, NG 743, 744 of 1992, 26 February 1993)

Tasmanian Dam Case (1983) 158 CLR 1.

Re Judiciary and Navigation Acts (1921) 29 CLR 257.

HEARING

SYDNEY, 24 March 1993

#DATE 24:3:1993

Counsel for the applicants: Mr A.W. Street with Mr A. Ogborne

Solicitors for the applicants: Thomson, Rich and O'Connor

Counsel for the respondents: Mr D. Rose QC and Mr P. Roberts

Solicitor for the respondents: Australian Government Solicitor

ORDER

THE COURT ORDERS THAT:

1. The application be dismissed.

2. That the applicants pay the respondents' costs including reserved

costs.

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

JUDGE1

HEEREY J The application before me commenced as an application for an interlocutory injunction to restrain the respondents from preventing or interfering with the applicants' fishing by reason of par 20B of the Northern Prawn Fishery Management Plan 1989 as amended ("the Plan"). However, at a late stage of the argument, counsel for both sides agreed that since the grounds on which the Plan was challenged would not involve consideration of evidence on the trial of the proceeding, it would be a convenient course for me to determine these objections as on a final hearing. I was informed that the requisite notices under s.78B of the Judiciary Act 1903 have been given and that no Attorney-General wishes to intervene.

1. Under the Plan, the right to fish in the Northern Prawn Fishery is conditional on, amongst other things, the fisherman having applicable to his boat the "applicable number" of units. Those units are calculated by reference to the dimensions of the hull of the boat and the power of her engine. The applicants owned two boats for which the applicable number of units were 518 and 382. The Plan provides for a maximum number of units for the fishery. The respondents, apparently for reasons of conservation and efficient management of the fishery, decided to reduce the maximum number of units from 72,216 to 50,000. This was to be done by a compulsory restructuring programme which by par 20B of the Plan would "expire" the number of units held by a fisherman in respect of his boat by a factor of 30.76 per cent. (The somewhat awkward term "expire" was used rather than "cancel" out of sensitivity to possible Capital Gains Tax implications.) The result would be that a fisherman who wanted to continue fishing would have to acquire more units to replace those expired so as to maintain the "applicable number" of units for his boat. These could be bought from fishermen leaving the fishery. The overall result would be fewer boats in the fishery.

2. In a judgment delivered on 26 February 1993 in NG743 and NG744 of 1992 O'Loughlin J accepted the applicants' argument that the provisions in the Plan for the expiring of units were invalid as an acquisition of property otherwise than on just terms and therefore contrary to the limitation on Commonwealth power contained in s.51(xxxi) of the Constitution.

3. Following his Honour's judgment, which is presently subject to appeal, the Plan was amended by the insertion of the following paragraphs:
   

"20B(11) If, but for this provision, the operation of any other provision of paragraph 20B would result in the acquisition of property from a person

otherwise than on just terms, there is payable to the person by the Commonwealth such

reasonable amount of compensation as is agreed between the person and the Commonwealth or, in the absence of agreement, as is determined by a court of competent jurisdiction.

20B(12) In paragraph 29B(11), 'acquisition of property' and 'just terms' have the same respective

meanings as in paragraph 51(xxxi) of the

Constitution."

1. The first of the two grounds of attack was that the Plan as amended by par 20B(11) did not comply with the constitutional requirement because it did not contain "express provision for compensation". It was said that it was not sufficient to make a right to compensation conditional, and that legislation must, to comply with s.51(xxxi), expressly provide for compensation on just terms.

2. There does not appear to be any explicit judicial pronouncement on legislation of a comparable type. However, in the Tasmanian Dam Case (1983) 158 CLR 1 the High Court had to consider, amongst other things, an argument that s.17(3) of the World Heritage Properties Conservation Act 1983 (Cth) contravened s.51(xxxi). A summary of the terms of the legislation will be found in the judgment of Deane J, 158 CLR at 288-289. The legislation provided a preliminary machinery to determine whether there had been an acquisition of property and, if there had been, a procedure which purported to provide for just terms. Mason J (at 141-143), Murphy J (at 181-182) and Brennan J (at 246-248) held there had been no acquisition of property. Deane J (at 289-292) held there had been an acquisition of property which, because of the delay involved in the procedure and the lack of any provision for an award of interest, was not on just terms. The other members of the court (Gibbs CJ, Wilson and Dawson JJ) did not find it necessary to decide the point. All the justices who considered the matter appear to have implicitly accepted that there is no constitutional prohibition against legislation which is expressed so as only to provide for just terms in the event of some earlier determination that there has been an acquisition of property.

3. In my opinion par 20B(11) does provide for an acquisition of property on just terms. It was not disputed in argument before me that a provision that a "reasonable amount of compensation" be paid, to be fixed, in the absence of agreement, by a court of competent jurisdiction would amount to just terms. That being so, I do not see any objection in principle to legislation providing for such terms if and only if, the constitutional criterion of acquisition of property is found to exist.

4. As O'Loughlin J's judgment demonstrates, it can sometimes be a difficult question whether something belonging to a person is "property" or whether Commonwealth legislation has effected an "acquisition" of that property. If the legislation is expressed so as to provide for just terms once those conditions are satisfied, I think it meets adequately the purpose behind the Constitutional limitation of power contained in s.51(xxxi).

5. The second ground of attack was that par 20B(11) was invalid because it vested a function which was legislative in nature in a court exercising Federal jurisdiction and thus infringed the doctrine of separation of powers. It was said there was no "matter" of which the court would be seized in performing the determination as to whether the provision would result in acquisition of property from a person and that there was an invalid attempt to confer on the court the function of giving an advisory opinion. Reference was made to Re Judiciary and Navigation Acts (1921) 29 CLR 257 at 266-267.

6. I do not accept this argument. In my opinion, par 20B(11) is plainly directed towards a specific instance of an alleged acquisition of property from a particular person. A court faced with a question arising under par 20B(11) is not being asked to advise in the abstract upon the construction of legislation, but has to determine whether a particular event does or does not answer a statutory description. This is, to my mind, essentially a judicial function.

7. I conclude therefore that the two grounds of challenge are not made out. Because, for the reasons I have mentioned, the matter is now being dealt with as on a final hearing, it is not necessary to consider arguments which were initially advanced as to whether damages are an adequate remedy or questions of balance of convenience. The application will be dismissed with costs, including reserved costs.