Jemena Asset Management (3) Pty Ltd & Ors

[2010] HCATrans 228

[2010] HCATrans 228

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M6 of 2010

B e t w e e n -

JEMENA ASSET MANAGEMENT (3) PTY LTD (ACN 086 013 461)

First Applicant

JEMENA ASSET MANAGEMENT (4) PTY LTD (ACN 009 641 187)

Second Applicant

JEMENA ELECTRICITY NETWORKS (VIC) LIMITED (ACN 064 651 083)

Third Applicant

and

COINVEST LIMITED (ACN 078 004 985)

Respondent

Application for special leave to appeal

FRENCH CJ
BELL J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 3 SEPTEMBER 2010, AT 11.55 AM

Copyright in the High Court of Australia

MR A.J. MYERS, QC:   May it please the Court, I appear with MR C.B. O’GRADY for the applicants.  (instructed by Herbert Geer)

MR P.J. HANKS, QC:   Your Honours, I appear with MR S.J. MOORE for the respondent.  (instructed by Maddocks)

FRENCH CJ:   Thank you.  Yes, Mr Myers.

MR MYERS: Thank you, your Honours. The court below decided there was no inconsistency within section 109 of the Constitution between Commonwealth legislation, and this is to use the court’s words below, which deals with all ordinary aspects of long service leave entitlements which might arise in an industrial relationship between employer and employee by imposing upon employers an obligation to give paid leave or make payment in lieu of leave when the employee has been employed by the employer for 10 or more years and a State law which imposes upon the employer an obligation to give leave or make a payment or, depending upon the construction of the State Act, merely make a payment in relation to an employee’s period of employment in the construction industry without reference to the employee’s period of employment with the employer. In our submission, there is a manifest inconsistency between the two laws and the decision of the court below was wrong.

FRENCH CJ:   I suppose one could see the two living side by side without controversy if the State law were confined to, as it were, securing funds for the payment of workers entitlements.  The question is, does it go beyond that?  Maybe you do not accept that premise, anyway?

MR MYERS:   No, we do not accept that proposition, your Honour, but that was the approach that the court below took and it arrived at a certain construction of the ‑ ‑ ‑

FRENCH CJ:   But you have identified other impositions that you say the state Act effects.

MR MYERS:   We certainly have.  Dealing with the central question of leave or payment or both, we say that the State Act is quite clear in its terms.  Section 6 is set out in the book at page 31.  It says:

(1)Every worker is entitled to long service leave, and to be paid benefits out of the fund, in respect of continuous service in the construction industry.

So every worker is entitled long service leave and to be paid benefits out of the fund –

(3)The amount of the entitlement –

and that is an entitlement to long service leave and to be paid benefits out of the fund –

and the method by which that amount is to be calculated are as determined from time to time by the trustee in accordance with the trust deed. 

So the legislation authorises the trustee to make determinations about an entitlement to leave.  It may be, and we would concede it for the purposes of the argument today, that the trust deed and its rules do not, in the present state of the trust deed, do so, but there is an authorisation conferred by the statute and that is sufficient to create an inconsistency.

FRENCH CJ:   Incidentally, do you accept the proposition that the rules are not subordinate legislation?

MR MYERS:   No, although if I were asked to justify that by detailed argument at the moment, I could perhaps be excused for not doing as well as I ought to.  It is a really difficult question and the way in which this scheme has been devised, we say, is to achieve the sort of result that was achieved in the court below.  Here what is the difference between this trust deed and subordinate legislation is very hard to identify.

It is sufficient, we say, if the Act authorises the trustee to make rules regarding leave.  It is sufficient to create an inconsistency and from one point of view the crucial matter is whether the Victorian statute provides for an entitlement to leave.  We say it requires or authorises an amount of leave to be determined and that is certainly inconsistent with the Commonwealth Act, and the respondent concedes as much in the application book page 66, paragraph 2.1.  Your Honours may have noticed that, if your Honours want to look at it.

FRENCH CJ:   Yes.

MR MYERS:   Yes.  So that if we are correct on the question of construction, our friends concede, in effect, that the court below was wrong.  We also say that even if we are not correct on that issue of construction, there is still an inconsistency.  Could I invite your Honours to look at Worthing.  I know it is a passage that is often referred to but it does repay examination.  It is tab 1 of the book of authorities.  At paragraph 27 the Court says:

The applicable principles are well settled. 

We agree with that –

Cases still arise where one law requires what the other forbids.

There is a reference to Wallis –

However, it is clearly established that there may be inconsistency within the meaning of s 109 although it is possible to obey both the Commonwealth law and the State law. Further, there will be what Barwick CJ identified as “direct collision” where the State law, if allowed to operate, would impose an obligation greater than that for which the federal law has provided. Thus, in Australian Mutual Provident Society v Goulden, in a joint judgment, the Court determined the issue before it by stating that the provision of the State law in question “would qualify, impair and, in a significant respect, negate the essential legislative scheme of the Life Insurance Act 1995 (Cth)”. A different result obtains if the Commonwealth law operates with the setting of other laws so that is supplementary to or cumulative upon the State law in question.

Now, what we say here is that there is an inconsistency, even on the construction that is advanced by our friends, in two respects.  There is the so‑called direct inconsistency, the first of Justice Dixon’s propositions in Victoria v The Commonwealth, and there is the covering of the field or indirect inconsistency, the second of those propositions that are set out on the page to which I have taken your Honours in Worthing. 

The direct inconsistency; we ask the question, does the State law alter, impair or detract from the operation of the Commonwealth law?  We say yes, because it imposes an obligation which is additional to and greater than the obligation imposed by the Commonwealth law so that it alters, impairs or detracts from the Commonwealth law.  The State legislation imposes an obligation which is an obligation to make payment to the respondent as trustee of the State trust fund in relation to any employee in the construction industry whether or not that employee has served 10 years with the employer.  The only obligation under the Commonwealth law is to make a payment to an employee or grant paid leave to the employee if the employee has served 10 years with the employer.

FRENCH CJ:   The way it works is if and when the employee takes a leave entitlement or leave entitlements under the federal award or agreement or the employer pays out the employee under the federal scheme, there is a recovery from the State fund, is there not?

MR MYERS:   Yes, there is a recovery, but, of course, the amount which may be required to be paid to the State fund may be greater and, indeed, almost necessarily be greater than the amount that would be paid under the Commonwealth enactment.  The State fund provides for a levy of up to three per cent.  That does not bear any relationship to a particular person’s entitlement to long service leave. 

FRENCH CJ:   Where is that provision?  Is that in the trust or in the Act?

MR MYERS:   It is in the rules.  I know it, so it must be in the application book ‑ ‑ ‑

FRENCH CJ:   So it must be somewhere.

MR MYERS:   ‑ ‑ ‑ but to put my hand on it – it is in the findings made by the Full Court, I am told, but no one is able to tell me exactly where it is, so if I can come back to that, your Honour.

FRENCH CJ:   All right.

MR MYERS:   It is 33 of the book at line 42.  Yes, it seems to be.  The other way in which a greater amount is payable is that payments have to be made by an employer to the fund in respect of an employee immediately the employee starts employment whether there has been 10 years employment or not.  It is a quite different scheme, a completely different scheme, and the argument below was that, well, because this fund is interposed, there is no inconsistency.  We say, with respect to that, there is obviously an inconsistency. 

The sort of scheme that is involved here is still something that relates to a particular employee’s employment.  Just as, for example, no one would say now compulsory superannuation payments that an employer has to make into a fund in respect of an employee, the fund being a fund conducted by someone who is authorised to conduct superannuation business, is not something that pertains to the relationship between the employer and the employee.  This does.  That central fact just seems to have been omitted in the reasoning of the court below.

BELL J:   There is also the question of the disputes mechanism under the State Act which is dealt with at application book 34 in – I cannot quite read the paragraph number in the Full Court’s reasons, but the court seems to contemplate that there could be disputes between employer and employee touching on whether or not the person is a worker within the industry.

MR MYERS:   And what period of service that person has had, certainly.

BELL J:   Yes.

MR MYERS:   This scheme is integral to the relationship between employer and employee in connection with long service leave.  Just because there is an interposition of a trustee does not make the slightest difference to the constitutional question.  The court below deals with this aspect of the case at paragraph 39 on page 36 of the book.  There is a reference to Worthing, a direct collision and the reference to a greater obligation. 

However, this was in the situation where the statute of the State required payment of a larger sum by way of wages than the amount prescribed by the federal award.  This was not just a case of a greater obligation, but payment by the employer of wages conforming to the federal award involving the employer in disobedience to the State provisions –

Well, that is completely wrong.  Payment only of that amount involved disobedience, the payment of that amount did not involve disobedience, the fact of it is and the substance of this case, which is not dealt with below, is that there is a direct collision between the scheme constituted under the federal legislation, the federal awards and the State scheme.  We also say that if one looks at the matter from the point of view of considering the field that is covered, the decision below is wrong.  The court below said in its judgment that the Commonwealth award is comprehensive in its scope.  It said that in paragraph 8, page 29. 

The 1998 Award deals with all the ordinary aspects of long service leave entitlements which might arise in the industrial relationship between employee and employer.

It covers the field in different words, the court is saying, of the industrial relationship between employee and employer in relation to long service leave entitlements.  This State scheme intrudes into that field.  It matters nothing that there is a trustee who intervenes, no more than it would matter in relation to, for example, superannuation when necessarily a trustee intervenes.

FRENCH CJ:   Do you say that they departed from well‑established principle in their approach or that they simply misapplied the principle, because then it boils down to a question of really the characterisation of the operation of the State scheme in the field of operation of the Commonwealth and that goes to the question of whether it is a special leave point, I suppose?

MR MYERS:   It depends what is principle in, with respect, your Honour’s question.

FRENCH CJ:   Well, they sometimes call section ‑ ‑ ‑

MR MYERS:   I mean, the court below found the passages in Worthing which set out the principle, but the way in which it has been applied suggests either that they did not understand the principle or they made some other fundamental mistake.

FRENCH CJ: Section 109 sometimes has been called, I think, the constitutional running down jurisdiction and that, I think, is meant to simply direct attention to the fact that very often it is a debate about statutory interpretation and characterisation.

MR MYERS:   It can be a debate about characterisation, but here there cannot really be a debate about characterisation.  The Commonwealth legislation or award, as the court below found, in effect, covers the field.  The question is whether this State scheme pertains to the relationship between employer and employee in relation to long service leave and we say the answer should be a resounding yes.  Then there is a question of whether there should be special leave.  This is an important matter.  This relates to the construction industry, one of the largest industries in the country and if this Court were of the view that the principles have been misapplied, and we respectfully say that the Court will be of that view, this is a very important matter.  Although other jurisdictions in Victoria have legislation which is not exactly the same ‑ ‑ ‑

FRENCH CJ:   Victoria and Tasmania are said to be similar, are they?

MR MYERS:   Similar, yes.  One can imagine that this might be something that would catch hold if some parts of the construction industry thought it were desirable for it to do so.

FRENCH CJ:   If one does it, everybody will want to do it, that is the argument?

MR MYERS:   In my respectful submission, that is the fact of it.  This is a matter that is important for Victoria, it is an important industry and it is important for the whole of the administration of justice in Australia.  There is one other matter that is raised and that is that question of costs.  Now, I know your Honours do not want to hear about costs, but it does appear that the court below misunderstood the position and under the Workplace Relations Act they were not entitled to award costs against my client unless they decided that it had proceeded vexatiously or without reasonable cause, and there is no hint that they did that and that is a matter in which they were wrong.  If the Court pleases, they are our submissions.

FRENCH CJ:   Now, just before you sit down, Mr Myers, just going to your draft notice of appeal.  If special leave were granted, I am just wondering whether you would, apart from the cost question, really need to go beyond 1 through to 4 and perhaps 5.  Do 6 and 7 really add anything?

MR MYERS:   No, I would be content with that, your Honour.  I would be content with that.

FRENCH CJ:   Yes, all right.  Thank you.  Yes, Mr Hanks.

MR HANKS:   What is critical to an understanding of the Full Court’s judgment is to, with respect, grasp the nature of the rights and obligations that are created by the Commonwealth law and the State law and for present purposes, as the Full Court and the primary judge found, the State law is found not only in the Act but also in the trust deed and the rules made under that deed, and that is because many of the provisions of the Act contemplate that the rights that arise under the Act will be spelt out in the trust deed. 

That could not, of course, be clearer than in the case of section 6(3) which indicates very clearly that the entitlements of a worker are to be the entitlements that are defined by the trust deed.  So that is an essential starting point because whatever approach one takes to identifying inconsistency for the purpose of 109, one needs to understand how the law, the two laws, are structured and what are the rights and obligations that they purport to create and confer. 

The members of the Full Court and, indeed, the primary judge analysed the State law by going through not only the Act, but the trust deed and the rules made under the trust deed and they very clearly identified that there were certain obligations cast first on employers by the State law, an obligation to register and an obligation to keep records and an obligation to make returns.  In fact, one can see those obligations articulated in the Act in section 8 and section 9 of the Act.  Then the Act imposes a compulsory charge on employers in the construction industry. 

Your Honours can see that in section 4(1) of the Act.  If one then goes to subsection (2), one sees that the timing of the charge and the amount of the charge will be determined by the trustee, that is our client, the present respondent, in accordance with the trustee.  All the judges of the Federal Court who looked at this particular scheme came to the conclusion that it did not require employers to grant leave to employees or, to put it another way, that a worker can take benefits out of the fund to which the charges on employers contribute but leave can only be taken with the employer’s agreement. 

Your Honours will see the primary judge made that finding on page 9 of the application book at about line 48.  The Full Court, at page 33 of the application book, line approximately 26, said the only entitlement, that is the entitlement of a worker, is to a payment from the fund.  Your Honours, I think it is on the same page of the application book that the Full Court referred, at about line 42, to the provisions in the trust deed and the rules that provided for a refund to employers of their contributions to the fund in respect of any worker to whom the employer had granted leave outside the State scheme, that is, under the federal instruments. 

So fundamental to an understanding of the State law is that it does not create any entitlement to leave, it creates only drawing rights on the fund, being a fund to which each employer in the construction industry is obliged to make a contribution.  Those drawing rights, of course, are rights that vest once the worker has completed 10 years service in the industry, in contrast to the provisions in the award which would give a right to leave, that is, long service leave, once the worker had completed 10 years continuous employment with the one employer.  So one can see how it operates, as we are on a different plane or in a different sphere.  It is described in some of the judgments as a scheme that creates rights to portable long service leave.  It is not a right against a particular employer, so far as the Act is concerned, it is a right against the fund. 

That is critical to an understanding of whether there might be inconsistency in either of the sentences identified in Telstra that our friend took the Court to at about paragraph 28 where this Court quoted from Justice Dixon in what we call the Shipwreck’s Case, sometimes I think called SS Kalibia, just to distinguish it from the many other bits of litigation by the name of Victoria v Commonwealth.  It was there that Justice Dixon identified those two distinct kinds of inconsistency, namely, where the State law, through its operation, will detract or impair from the operation of the Commonwealth law or where the State law enters onto a field that the Commonwealth law was intended to deal with exhaustively and exclusively, a “cover the field” approach to inconsistency.  The primary judge in the Full Court considered the operation of the State law constituted by the Act and the trust deed and the rules and the operation of industrial instruments and the rights that they create in that setting.

FRENCH CJ:   Is it critical to your submissions that the obligations created by the State Act are not matters which go to the employer/employee relationship?

MR HANKS:   That is central to the point we make, your Honour.

FRENCH CJ:   If that characterisation is wrong, then there is a problem, is there not, or potentially a problem?

MR HANKS:   If the characterisation were wrong, your Honour.  It is the characterisation that the Full Court and the primary judge adopted.

FRENCH CJ:   Yes, appreciate that.

MR HANKS:   We do not have any embarrassment in defending their Honours’ characterisation.  Characterisation is, of course, critical here.  Our friend said this morning, if I could just pick up on something that was said in his principal oral submissions, that the State law does alter, impair or detract from the operation of the Commonwealth law, using those general terms, because it imposes an additional obligation.  One needs to look at the nature of the obligation that is imposed and if it is merely an obligation to make a contribution to a fund with certain ancillary obligations such as keeping records and making returns ‑ ‑ ‑

FRENCH CJ:   Well, “additional” suggests within some framework, some set of obligations ‑ ‑ ‑

MR HANKS:   That is right.  But all related to the, what we would say quite simply, is the imposition of this tax, this compulsory charge for a public purpose.  They are all related directly to that.  That is the obligation that the State imposes, but that says nothing about the industrial obligations and the industrial rights arising under the Commonwealth law.  The obligation of the employer to provide long service leave, the right of the worker to demand long service leave from the employer is left untouched.

BELL J:   Can I just take up with you this question of the disputes mechanism and the significance of it?  It does seem that the body established under the State Act might concern itself with disputes between employer and employee including, with respect to the length of service, things of that character?

MR HANKS:   They have to be disputes relating to the operation of the scheme.  That is plain from a statutory position, we would say.  They are not disputes about entitlements under the award.  They are disputes about the operation of the scheme.  Obviously in that setting, a dispute might arise.  An employer might say, “This particular worker is not employed in the construction industry and, therefore, I have no obligation to make a contribution to the trustee for that worker.”  The worker, if aware of that, might want to contest that point because, if that were true, the worker would not be accumulating drawing rights on the fund maintained by the trustee and so there would be a dispute about a matter of that kind.  In our submission, that involves no intrusion into the matters that are dealt with by, as it then was, the Workplace Relations Act and the industrial instruments made under that Act. 

I want to go back to this basic question of characterisation.  Our friend also said that the Commonwealth award is, of course, acknowledged to be a comprehensive statement, comprehensive statement of the rights and liabilities of employers and employees that are subject to the award and, therefore, and is, with respect, a very substantial leap.  When the State does what the State has done in this Act, in this law, it has intruded into that field.  Now, that cannot be right because it is necessary quite clearly to identify, as it was put in Telstra, the subject matter of a Commonwealth law.  What is its subject matter?  How do we characterise it? 

It is a law necessarily because it is supported, I think it was this time still supported, by 51(xxxv) rather than 51(xx).  It is a law that defines the industrial relationships between employer and employees.  That is what it does.  It sets out rights and obligations inter se, if I could indulge in a tiny bit of Latin.  The State law does not affect those relationships at all.  It imposes a tax, the proceeds of the tax go into a fund and it confers on workers drawing rights on that fund.  It contains various provisions that are designed, perhaps imperfectly, but certainly designed to avoid double dipping by workers, but it does not intrude into the industrial relationship.  Our friend took your Honours to section 6 of the Act.  I would like to, if I could, take your Honours back there to the State Act, section 6(1):

Every worker is entitled to long service leave, and to be paid benefits out of the fund –

That is effectively the shortened version.  We need to go, as friend then did, to subsection (3):

The amount of the entitlement and the method by which that amount is to be calculated are as determined from time to time by the trustee in accordance with the trust deed.

Our friend said that the authorisation implicit, no doubt, in subsection (3) for the trustee to calculate an entitlement to long service leave would be enough to create inconsistency because that would contemplate an intrusion by the trustee into what we have described as the rights and obligations within the industrial relationship.  Let us assume that the authorisation is wide enough to authorise the trustee to make that intrusion, if I can put it in conventional terms, to enter the field or to disturb or impair, using the other approach to inconsistency, the operation of the Commonwealth law. 

If that were true, then the authorisation would be invalid under 109 to the extent of the inconsistency and no more, that is, the Act would not be invalid. You would simply blue pencil that out, provided that the State Act could continue to operate effectively and there is no reason why it could not. That is the operation of section 109, as I am sure your Honours are well aware. It does not destroy the State law entirely. It provides that to the extent of the inconsistency the State law is invalid.

FRENCH CJ:   Is this adequately reflected in the questions that were decided?  I think they are set out at pages 4 and 5, are they not?

MR HANKS:   They are, your Honour.

FRENCH CJ:   It is an extent of inconsistency. 

MR HANKS:   It is, yes.  That is so, your Honour.  If the court had concluded that there was, as it were, a minimal or a degree of inconsistency, they could have answered the question appropriately.  But in a way, if I might put it this way, this is a somewhat abstracted question because it is clear from the findings that the primary judge made and the Full Court made, that the authority, whatever the authority is, given to the trustee has been exercised only to create a right to draw on the fund and not a right to take leave from the employer.  That is clear.

There are some other matters I wanted to deal with quickly, if I could, and they relate directly to what is said in the reply by our friends, that is, the written reply. Your Honours will see that starting at page 76 of the application book. The first paragraph our friends, as we understand it, seek to broaden the nature of the controversy that this application for special leave presents and, with respect, we say that the paragraph obscures rather than clarifies the issue in dispute. Generalised questions about the extent to which the State scheme interferes with or augments the scheme created under federal law do not assist in answering the question, is there inconsistency within section 109?

We are working here, if I could echo something that my learned friend, Mr Merralls, said last week, with something that does have almost the character of the eleventh commandment, namely, what was said by Sir Owen Dixon in the SS Kalibia, namely, there are two fundamental ways in which to identify inconsistency and one is whether the State law would alter, impair or detract from the operation of the federal law and the other is whether the State law enters a field with which the federal laws intended to deal exhaustively and exclusively. 

Now, those are the questions that have to be answered, not the broader question as to whether the State scheme in some way interferes with or augments the federal scheme.  That was the first point we wanted to make.  The second point was in relation to paragraph 2.  It was echoed in a proposition that our friend, Mr Myers, made this morning.  It said that:

The appeal also concerns the application of the principles stated in the Hospital Benefits Case –

if I could come to that very briefly at the end of my submissions, I will –

and whether the fact that a third party, like the respondent, is interposed in the imposition of the obligation avoids an inconsistency of the type contemplated by section 109.

We say the fact that a third party, such as the respondent, the trustee, is interposed is not of any significance.  What is significant is, what is the obligation in question in which the respondent plays a part?

FRENCH CJ:   Does it play any part in the Full Court’s reasons?

MR HANKS:   This question of interposition?

FRENCH CJ:   Yes.

MR HANKS:   I do not think so because, in our submission, your Honour, it is irrelevant.

FRENCH CJ:   No, I just wondered it ‑ ‑ ‑

MR HANKS:   I do not think so, your Honour, but what did play a part was a clear focus by their Honours on what was the nature of the obligation that was created by the State law.  The fact that it was an obligation that was perhaps mediated through the trustee did not assume any significance, nor should it now assume any significance.  The question must remain whether the obligation created by the State law in some way impairs or detracts from the operation of the Commonwealth law, that it is the question, or, alternatively, whether that obligation created by the State law intrudes into the field covered by the Commonwealth law.  It does not matter whether they are – it is an obligation to pay to the State, or an obligation to pay to the trustee.  It is not significant.  In paragraph 3, what we understand our friends to say is, the application:

concerns whether the tests for direct and indirect inconsistency must be considered in isolation. 

They say that the tests should not be considered in isolation –

that the issue, in all cases is the manifest intention of the paramount legislature and whether it should be taken to have intended that regulation of the type enacted by the subordinate legislature, should have –

or should not have perhaps –

full force and effect. 

In our respectful submission, that is a false issue.  Inconsistency can arise and often does arise not by reason of any intention on the part of the Commonwealth, the paramount law maker, but because the rights, the duties, the immunities, the powers created by the respective laws are such that the subordinate legislature has entered the field of paramount legislature or the subordinate legislature has interfered with the operation of a law passed by the paramount legislature.  It depends on legal analysis effectively.

FRENCH CJ:   The intention to cover the field is, in a sense, an “after the event” characterisation, I suppose, of the scope of the obligations and rights which are created.

MR HANKS:   That is so, your Honour, but I was referring to the first of the, if I can use this term, species of inconsistency recognised in Telstra. 

FRENCH CJ:   Yes, I know.

MR HANKS:   I would ask your Honours to go to Telstra, which is in the folder that our friends provided, to page 78, paragraph 32.  Your Honours will see the discussion in paragraph 32 where they say:

It would be no answer that the subject-matters of the two laws are not co-incident.

and I might say, if I could interpolate, it would be an answer if we were using the “cover the field” test –

Rather, the State law, by granting certain rights, would deny or vary a right, power or privilege conferred by the federal law.

When one is looking at inconsistency through that prism, one is concerned only with the rights, the duties, powers and privileges created by the two laws and one undertakes that legal analysis, and that is essentially what the Full Court did.  I will just refer your Honours, if I might, to pages 34 and 36 of the application book.  There is a very detailed analysis of those matters there. 

FRENCH CJ:   Yes, we have done that.  Thank you, Mr Hanks.

MR HANKS:   Thank you, your Honour.

FRENCH CJ:   Yes, Mr Myers.

MR HANKS:   Sorry, your Honour, could I just deal with the cost point that our friend made?

FRENCH CJ:   Yes.

MR HANKS:   We dealt with that in our written summary and we would suggest the appropriate disposition is as we put it there.

FRENCH CJ:   Thank you.  Mr Myers.

MR MYERS:   Thank you, your Honours.  Just a few things I wish to say.  The fundamental point that was advanced in the oral submissions was that the State enactment did not touch the relationship between employer and employee in respect of long service leave.  It was a tax that was imposed and paid to a third party out of which some payments could be made to an employee in the construction industry.  That ignores practically every significant aspect of this matter and, in particular, it ignores the terms of section 6 of the State enactment.  It says, in terms:

Every worker is entitled to long service leave, and to be paid benefits out of the fund, in respect of continuous service in the construction industry. 

The present state of the rules do not provide for long service leave, but under that statute they could and by parity of reasoning with, for example, the case of P v P dealing with an analogous matter referred to on page 35 of the book, paragraph 34 of the judgment, if a State Act authorises a tribunal to make decisions which affect the subject matter of the Commonwealth legislation, then that is a relative inconsistency.  That is important not only for the reason that your Honour Justice Bell advanced, but also because the State, the trustee under this Act, could make rules concerning long service leave and, in a way, the court below recognised that.  If your Honours look at page 31 of the book, line 29:

s 6 does not necessarily provide workers with the statutory right to take long service leave –

That is a recognition that the trustee could make those rules and that is sufficient.  Another matter that I wish to advert to in reply relates to my learned friend’s response to Justice Bell’s question about what sort of disputes could be determined under this dispute resolution mechanism.  My learned friend’s answer was that under the dispute resolution mechanism there could be no decision concerning the effect of the Commonwealth

award.  Well, that may be admitted, of course they could not do that, but that is not what inconsistency is about.  They could make decisions concerning matters that are dealt with by the Commonwealth award, and that is incontrovertible.  If your Honours please, they are the submissions I wish to make in reply.

FRENCH CJ:   What do you say in response to paragraph 25 of the respondent’s argument in relation to ground of appeal 8, that is the cost question?

MR MYERS:   I would accept that.

FRENCH CJ:   Yes, all right.  Thank you.

MR MYERS:   Thank you, your Honours.

FRENCH CJ:   There will be a grant of special leave in relation to grounds 1 to 5 of the draft notice of appeal.  Mr Myers, you will obviously have to deal with 78B notices.  What is your estimate of the time?  There would not be more than a day in this, I would have thought. 

MR MYERS:   I should not think there would be more than a day, your Honour, at least.

FRENCH CJ:   Yes.  Subject to any interventions that might occur.

MR MYERS:   Yes, subject to that, of course.

FRENCH CJ:   Do you agree with that, Mr Hanks?

MR HANKS:   I will have to give guarded agreement, your Honour, because it will be necessary for the Court, I apprehend, to go to the trust deed and the rules.  They are not a model of clarity.

FRENCH CJ:   How unusual.

MR HANKS:   Your Honours, we have seen some criticism of the way in which topsy-like they have grown in the Full Court’s reasons.

FRENCH CJ:   Perhaps a day and a half to be safe, do you think?

MR HANKS:   We might drift over a day just because I apprehend there might be some difficulties.

FRENCH CJ:   All right.  Thank you, Mr Hanks.  The Court will adjourn until 1.30 pm for the next matter.

AT 12.41 PM THE MATTER WAS CONCLUDED