Gould v Brown

Case [1998] HCA 6


HIGH COURT OF AUSTRALIA

BRENNAN CJ,
TOOHEY, GAUDRON, McHUGH, GUMMOW AND KIRBY JJ

VANDA RUSSELL GOULD & ORS  APPELLANTS

AND

MARTIN RUSSELL BROWN in his capacity as
liquidator of Amann Aviation Pty Limited
(in liquidation)  RESPONDENT

Gould v Brown (S204/1996) [1998] HCA 6
2 February 1998

ORDER

Appeal dismissed with costs.

On appeal from the Federal Court of Australia

Representation:

F M Douglas QC with P J Dowdy and K M Connor for the appellants (instructed by Henry Davis York)

S D Robb QC with A Robertson SC and M A Jones for the respondent (instructed by Nash O'Neill Tomko)

2.

Interveners:

D R Williams QC (Attorney-General) with G Griffiths QC, H C Burmester and S J Gageler intervening on behalf of the Commonwealth (instructed by the Australian Government Solicitor)

P A Keane QC with R W Campbell intervening on behalf of the Attorney-General for the State of Queensland (instructed by the Crown Solicitor for the State of Queensland)

D Graham QC with C M Caleo intervening on behalf of the Attorney-General for the State of Victoria (instructed by the Victorian Government Solicitor)

R J Meadows QC with R M Mitchell intervening on behalf of the Attorney-General for the State of Western Australia (instructed by the Crown Solicitor for Western Australia)

B M Selway QC with J P Gill intervening on behalf of the Attorney-General for the State of South Australia (instructed by the Crown Solicitor for South Australia) and also intervening on behalf of the Attorney-General for the State of Tasmania (instructed by the Crown Solicitor for Tasmania)

J J Spigelman QC with L S Katz SC intervening on behalf of the Attorney-General for the State of New South Wales (instructed by the Crown Solicitor for New South Wales)

Notice:  This copy of the Court’s Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.

CATCHWORDS

Gould v Brown

Constitutional law - Cross-vesting of federal, State and Territory jurisdiction - State law vesting jurisdiction in Federal Court to order winding-up of company - Whether State has power to confer State jurisdiction on federal courts - Federal law enabling Federal Court to accept vesting of State jurisdiction under State law - Validity of laws - Whether Ch III of the Constitution excludes the vesting of State jurisdiction in federal courts - Conditions under which State jurisdiction may be vested in federal courts.

Constitutional law - Issue of examination orders and examinations summons pursuant to Corporations Law - Validity - Whether exercises of judicial power.

The Constitution, s 51(xxxviii), Ch III, ss 107, 109, 122

Australia Act 1986 (Cth)

Colonial Laws Validity Act 1865 (Imp)

Companies Act 1961 (NSW)

Corporations Act 1989 (Cth), s 56(2)

Corporations Law, ss 596A, 596B

Corporations (New South Wales) Act 1990 (NSW), s 42(3)

Corporations (Victoria) Act 1990 (Vic), s 42(3)

Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth)

  1. BRENNAN CJ AND TOOHEY J.   This is an appeal against a judgment of the Full Court of the Federal Court (Black CJ,…

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Details
AGLC
Gould v Brown [1998] HCA 6
Case
[1998] HCA 6
Decision Date

CaseChat Overview and Summary

This case concerned an appeal by Gould and others against a decision of the Full Court of the Federal Court of Australia. The dispute arose from examination orders and summonses issued under provisions of the Corporations Law. The core of the legal challenge involved the constitutional validity of the cross-vesting of jurisdiction between State and federal courts, specifically concerning the power of a State to confer jurisdiction on the Federal Court.

The High Court was required to determine whether the Australian Constitution, particularly Chapter III, permitted the vesting of State jurisdiction in federal courts. It also had to consider whether the specific provisions of the Corporations Law under which the examination orders were made constituted a valid exercise of judicial power. The Court needed to assess the validity of both the State legislation that purported to vest jurisdiction and the federal legislation that enabled the Federal Court to accept such jurisdiction.

The Court, by majority, found that the relevant provisions of the Corporations Law, when construed in accordance with the applicable State Interpretation Act, were compatible with the conferral of jurisdiction on the Federal Court. It was held that the Federal Court could validly exercise judicial power under these provisions. The Court concluded that the cross-vesting legislation and the examination orders made pursuant to it were constitutional.

Consequently, the High Court dismissed the appeal with costs, affirming the decision of the Full Court of the Federal Court.

Orders

Orders of the court

Appeal dismissed with costs.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

BRENNAN CJ TOOHEY J GAUDRON J
The arguments on this issue are very finely balanced indeed. Strong reasons can be marshalled for each point of view. However, I agree, for the reasons given by Brennan CJ and Toohey J, that it is possible to select those provisions of ss 596A and 596B of the Corporations Law which are validly picked up by the carefully chosen language of s 7 of the State Act, construed in accordance with the Interpretation Act 1987 (NSW) s 31. I therefore agree that, so severed, the provisions sustaining the examination orders made in the present case, were compatible with a jurisdiction conferred on the Federal Court which involved the exercise by that Court of judicial power and nothing else[494].[494] See Re F; Ex parte F (1986) 161 CLR 376 at 384-385 where the relevant authorities are discussed.Conclusion and order Because I reach the conclusion that the decision of the Full Court of the Federal Court was correct, it is unnecessary for me to consider an additional submission, advanced on behalf of the State of New South Wales. This was that, in the event that the cross-vesting legislation were held unconstitutional, this Court should, as a matter of practice, adopt measures to delay the making of its orders so as to give an opportunity to the Governments and Parliaments involved to consider remedial legislation to cure the disruption which such a decision would cause in very many cases[495]. In the conclusion which I reach, the cross‑vesting legislation considered in this appeal is valid. So are the orders for the examination of the appellants. The answers given by the Full Court were correct. The appeal from the Full Court's orders should therefore be dismissed with costs.[495] See Northern Pipeline Co v Marathon Pipe Line Co 458 US 50 at 88-89 (1982); Re Language Rights under Manitoba Act, 1870 (1985) 19 DLR (4th) 1 at 46; Bilodeau v Attorney-General of Manitoba (1986) 27 DLR (4th) 39 at 46.

Ratio Decidendi

Legal Principle Established

Established by: BRENNAN CJ, TOOHEY J, GAUDRON J

Following amendment of the Corporations Act (Cth), each of the States and the Northern Territory enacted legislation making the Corporations Law applicable as a law of and for that State or Territory ("the counterpart legislation")[76]. In consequence, the Corporations Law now operates throughout Australia.[76] Section 7 of the Corporations Act of each State and the Northern Territory respectively applies the Corporations Law as set out in s 82 of the Corporations Act (Cth) as a law of that State or the Northern Territory.Jurisdiction with respect to civil matters arising under the Corporations Law By s 51 of the Corporations Act (Cth), jurisdiction is conferred on the Federal Court and on the Supreme Courts of the States and Territories[77] "with respect to civil matters arising under the Corporations Law of the Capital Territory." "Civil matter" is defined in s 50(1) to mean "a matter other than a criminal matter". Jurisdiction with respect to civil matters is also conferred on the Family Court of Australia and State Family Courts by s 51A and, except for superior court matters[78], on lower State and Territory courts by s 51B. And the courts which have jurisdiction under ss 51, 51A and 51B are authorised to transfer proceedings to other courts having jurisdiction under those provisions[79].[77] Note that, by s 51(2), jurisdiction is conferred on the Supreme Courts of the States and Territories "[s]ubject to section 9 of the Administrative Decisions (Judicial Review) Act 1977".[78] The expression "superior court matter" is defined in s 50(1) of the Corporations Act (Cth) to mean "a civil matter that the Corporations Law clearly intends (for example, by use of the expression 'the Court') to be dealt with only by a superior court."[79] See ss 53, 53A, 53AA, 53B and 53C. The counterpart legislation confers jurisdiction with respect to civil matters arising under the Corporations Law of the States and the Northern Territory in much the same way as jurisdiction is conferred by the Corporations Act (Cth). Thus, for example, s 42(1) of the Corporations (New South Wales) Act 1990 (NSW) ("the Corporations (NSW) Act") provides:"... jurisdiction is conferred on the Supreme Court of New South Wales and of each other State[80] and the Capital Territory with respect to civil matters arising under the Corporations Law of New South Wales."And s 42(3) provides:" Jurisdiction is conferred on the Federal Court with respect to civil matters arising under the Corporations Law of New South Wales."There are also provisions conferring jurisdiction on the Family Court and State Family Courts and, except for superior court matters, on the lower courts of the States and Territories[81]. Additionally, provision is made for the transfer of proceedings from one court to another[82]. Again, identical provision is made in the legislation of the other States and the Northern Territory.[80] "State" is defined in s 3 of that Act to include the Northern Territory.[81] Sections 42A and 42B respectively.[82] Sections 44, 44A, 44AA, 44B and 44C.