Lee and Anor v Commonwealth of Australia & Anor

[2015] HCATrans 123

[2015] HCATrans 123

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Melbourne  No M9 of 2015

B e t w e e n -

DANIEL THOMAS LEE

First Applicant

GRAEME PETER JAMES GROPLER

Second Applicant

and

COMMONWEALTH OF AUSTRALIA

First Respondent

MURRAY DARLING BASIN AUTHORITY

Second Respondent

Application for special leave to appeal

KEANE J
NETTLE J

TRANSCRIPT OF PROCEEDINGS

AT MELBOURNE ON FRIDAY, 15 MAY 2015, AT 1.49 PM

Copyright in the High Court of Australia

MR P.E. KING:   Thank you, your Honours, for the applicants, Danny Lee and Joe Gropler.  (instructed by Maloney Anderson Legal)

MR S.P. DONAGHUE, QC:   May it please the Court, I appear with my learned friend, MR C.L. LENEHAN, for the respondents.  (instructed by Australian Government Solicitor)

KEANE J:   Mr King.

MR KING: Thank you, your Honours. Your Honours, may I begin with a paradox and then address the topics I propose to rely upon seeking special leave by reference to the last four words in section 100 of the Constitution. The paradox is that the applicants commenced their action by writ of summons in the original jurisdiction of the court. The respondents moved that the matter be remitted to the Federal Court on the basis that there were disputed questions of fact, including whether or not there were reasonable water use rights involved, but then in the Federal Court, the respondents moved for summary disposal under section 31A on the basis that only this Court could resolve the critical issue. Indeed, the Full Court accepted that proposition at paragraph 107 at page 142 of the application book. Can I then turn, if your Honours please, to the topic ‑ ‑ ‑

KEANE J:   What paragraph was it?

MR KING:   Paragraph 107 at page 142.

KEANE J:   Paragraph 107, I do not think that can be right, 141.

MR KING:   Paragraph 107 – 141, I beg your pardon.

KEANE J:   This is in relation to the authority of Morgan?

MR KING:   That is correct. 

KEANE J:   But it is said against you that, quite apart from Morgan, one does not – you lose for reasons that accumulate before one gets to Morgan.

MR KING:   Let me deal with those by reference to the issues of “for irrigation” first.  There is no doubt, your Honours, that the Water Act 2007 empowers the respondent – that is, the Minister and the authority – to substantially reduce the water usage rights of the applicants, and it was held or found by their Honours at paragraphs 48 and 51 at page 129 of the application book that that cut was from 13,620,000 megalitres to 10,873,000 - a cut of 2,750 gigalitres on 22 November 2012 to take effect from 1 July 2019.

But your Honours will note from paragraph 48 at page 129 that the Basin Plan immediately fixes the new reduced take of water by those figures.  In the Riverland of South Australia where Joe Gropler has his small farm the schedule to the plan reduced it by even more by 28 per cent, and in Merbein in Northern Victoria that water resource plan area by 27.6 per cent. 

Your Honours, the first proposition I wish to put to the Court is this, that the Federal Court, both the Full Court and the primary judge, erred in adopting the wrong test of characterisation of the Water Act and the particular provisions, that having the result that the protection of the applicants provided for by section 100 was excluded.

In particular, if I can take your Honours to the application book at paragraph 135 in the Full Court and that is at page 147, and it is replicated in the test adopted by the primary judge at 123 and 124 at pages 42 and 43 of the application book, and the second sentence in particular in the Full Court:

Each of those parts and indeed the impugned provisions referred to above, are, as his Honour concluded, concerned with the protection of the environment –

Those words “concerned with” which focus on, in a sense, the purpose of the statute, in our respectful submission, are not the appropriate test for characterisation of a law of the Parliament for constitutional purposes.  That test, we respectfully submit, was clearly set out by Justice Kitto in Fairfax v Federal Commissioner of Taxation and that is:

inquiry as to which of the topics touched by the legislation . . . the main preoccupation of those who enacted it. Such an inquiry has nothing to do with the question of constitutional validity under s 51 of the Constitution. Under that section the question is always one of subject matter, to be determined by reference solely to the operation which the enactment has if it be valid, that is to say by reference to the nature of the rights, duties, powers and privileges which it changes, regulates or abolishes –

We respectfully submit, to ask the question what is the Act concerned with and to say that it is environmental protection does not ask the right question or apply the right test, and had that been done then certainly in the terms of the Spencer test it was not fanciful to propose that this was at least a law of trade and commerce.

KEANE J:   Mr King, in relation to your challenge to the validity of the Water Act based on section 100 of the Constitution, it is said against you at pages 188 and 189 of the application book at paragraphs 8 to 13 of your opponent’s summary that there are a number of reasons why your clients are not now adversely affected by the operation of the Act, and are unlikely to be adversely affected by the operation of the Act in terms of their rights. It might be useful if you were to focus upon those particular contentions.

MR KING:   Certainly, your Honour, that was our second proposition, that it is an error to have regard to government policy and administrative measures, which is really what those paragraphs propose, as the means whereby legislation is to be characterised for constitutional purposes, and really what those paragraphs are referring to are, well, we are fixing the water cuts now as at 24 November 2012 as a loss of 25.3 per cent of your water use rights, though it is really not going to hurt you because ‑ ‑ ‑

KEANE J:   These are rights under State law?

MR KING:   Well, they are usage rights which are measured by reference to State water entitlement, but it does not ‑ ‑ ‑

KEANE J:   Which are derived from State law?

MR KING:   They are derived from the Victorian Water – the Water Management Act (NSW), the Queensland Act and the Natural Resources Management Act (SA) and so on, but the critical thing that section 100 speaks about is the right to “the reasonable use of the waters of rivers”, in this case the River Murray, and, as clause 6.2 of the Basin Plan, at the passages I referred to earlier, paragraphs 48 and 51 of the Full Court’s judgment demonstrates, the reduction in water entitlements occurred as at 24 November 2012 and it was deferred in operation until 1 July 2019, and in the meantime the Commonwealth said, well, you are not going to be hurt by these cuts because we are going to spend lots of money in buying out wheat farmers or those who want to sell out or putting in infrastructure so it is really not going to affect you.

But, as Justice Evatt said in Riverina Transport v Victoria in a passage we have cited in our reply submission at page 260, to rely upon the aspirations and assurances of the legislator of the government as to the scope of administrative actions is, in effect, to make the Commonwealth “the sole protector of the citizens against infringement” of any constitutional protection.  In our respectful submission ‑ ‑ ‑

KEANE J:   I think we all understand the adage “Put not your faith in princes”, but just in terms of the findings of the court below, at paragraph 12 of your opponent’s summary at page 189, there is a summary of the findings that were made in the courts below in consequence of which it was accepted by the primary judge that:

whilst government policy may change, the evidence in this case is that the policy means irrigators who retain their entitlements will suffer no loss of entitlement to water as a result of the fixing of the SDLs -

Now, these are ‑ ‑ ‑

MR KING:   There is a short answer to that, your Honour.

KEANE J:   ‑ ‑ ‑ these are findings.  If this Court is to give special leave, I do not see that these findings are challenged in your proposed notice of appeal.

MR KING:   Well, your Honour, we do – our short point in relation to these findings is just that.  They are administrative measures which seek to mitigate the consequences of the Act and our evidence which was led before the primary judge and, indeed, the Full Court – and your Honours should see the acceptance of disputed facts at paragraph 24 of the Full Court judgment – was to the effect that not only did Danny and Joe and those who are members of the class have their water rights taken as at November 2012 but deferred to 1 July 2019, as at that date they have suffered particular losses and there was no cross‑examination of them on their affidavits. 

The first, and it is pleaded in the statement of claim, is this, that both of them have permanent plantings; Danny grows pomegranates, Mr Joe Gropler grows cherries.  They take seven years to mature into fruit‑bearing trees.  In 2012, the cuts happen.  In 2013, they then cease planting for the 2020 year because that is past the 1 July 2019 date.  The immediate consequence of that is a loss in equity in their farms, proportionately, and a loss of productivity in their farms. 

In addition, the large amount of money spent by the government under Part 6 of the Act through the environmental water holder, initially 12 billion it was said, purchased licences and land from some farmers but what it did was it filled up the dams, the Hume and the Dartmouth, and once the millennium drought ended in 2009, spillovers occurred and that had direct impact upon the water entitlements of the small horticultural farmers because a spillover means a forfeiture of carryover rights.

A third critical loss was this – and Joe Gropler gives evidence of this because he is chairman of the Cobdogla Irrigation Trust in South Australia, again not cross‑examined – namely, that because the Commonwealth had bought out half the farmers in their small irrigation community, which had been there since the late 19th century, the remaining farmers of about 40 per cent of what were there had suffered significant increased costs to pay for the infrastructure. 

So not only is there an immediate cut as at the date the Basin Plan deferred, albeit, but also they suffer other immediate losses.  There was no dispute about that, your Honour, and we respectfully submit, as Justice Evatt put in Riverina Transport, the undertaking by the Commonwealth publicly to spend lots of money, or take administrative measures, is not relevant to the question of the characterisation of the Act or its loss.

KEANE J:   But it is more than just undertakings, it is the findings that have been made alone.

MR KING:   But, your Honour, we are talking here ‑ ‑ ‑

KEANE J:   The findings as to the operation of the scheme.

MR KING:   But, your Honour, we are talking here only about a summary dismissal.  My clients have not even had the opportunity to lead their case or evidence.  Their affidavits indicate ‑ ‑ ‑

KEANE J:   That is true, but the findings that have been made have been made on the basis of the likely operation of the scheme. 

MR KING:   Well, with respect, your Honour, paragraphs 12 through to 24, my friend’s submission is speaking only of administrative measures and policies taken independently of the Act, not of the Act itself.  That is the whole point of Justice Kitto’s remark in Fairfax v Federal Commissioner.  One looks at the rights, liabilities, consequences which the Federal Court did not do, and I would briefly like to take your Honour to those particular provisions to demonstrate how the Act itself as a matter of law impacts upon them. 

If I could take your Honours please to page 242 and your Honours will probably be aware that Part 2 of the Act obligated the respondents to make a basin plan, and section 22(1) item 6 at page 242 is the provision in the Act which imposed a mandatory obligation upon the respondents to make a plan that identified:

The maximum long‑term annual average quantities of water that can be taken, on a sustainable basis, from:

(a)the Basin water resources as a whole; and

(b)the water resources, or particular parts of the water resources, of each water resource plan area.

Now, in Danny’s case that was 28 per cent, 27.6 per cent.  In Joe’s case it was 28 per cent reductions.  There is nothing in those words which has anything to do with environmental protection.  They are – they confer a power, to use the words of Justice Kitto, and a duty indeed, to identify the average quantities of water that can be taken.  The word “taken” is defined and is very important, if I can take your Honours back to 231.  There, the word “take” is defined as:

take water from a water resource . . . 

(a)pumping or siphoning water from the water resource –

classic irrigation –

(b)stopping, impeding or diverting the flow of water in or into the water resource –

again, irrigation –

(c)releasing water from the water resource if the water resource is a wetland or lake;

(d)permitting water to flow from the water resource if the water resource is a well or watercourse –

That is a neutral indication and then the last clause –

and includes storing water as part of, or in a way that is ancillary to –

and that is obviously the second part of the last four words in section 100, conservation of water. But there is nothing in the power or the obligation of the respondents in section 22(1) item 6 and the mandatory plan‑making functions which has anything to do with environmental protection. When one tests it against the test of constitutional validity identified by this Court in many cases, but going back to Justice Kitto’s observation, the court below simply adopted the wrong test by asking itself, at the passages to which I have referred, what is the Act concerned with? Environmental protection, said Justice North, and the Full Court agreed, but they never examined the way in which this Act operated. They never looked at how it affected Danny and Joe’s water rights and livelihood. Then can I take your Honours across to section 35, which your Honours will find at page 250 - the effect of the plan. Subsection (1):

The Basin Officials Committee, an agency of a Basin State, an operating authority, an infrastructure operator –

and here is Danny and Joe –

or the holder of a water access right must not:

(a)do an act in relation to Basin water resources if the act is inconsistent with the Basin Plan –

Now, that is a criminal sanction and if your Honours look at section 36(3), the Parliament justifies that, amongst other reasons, by reference to the trade and commerce power.  If it is the trade and commerce power that is the very thing that Morgan’s Case said was a sufficient basis for the operation of the protection in section 100.

In our respectful submission, the learned judges in the court below have just waved a wand across the statute by saying it is obviously about environmental protection.  There is…..there is bird migratory treaties effected but never asked the critical question required of a constitutional court, what are the powers, privileges, rights and liabilities that are actually affected?  That makes a criminal sanction against my clients.  So, in our respectful submission, that was an appealable error and a miscarriage of discretion on the section 31(a) basis.

Now, can I turn then to the words “for conservation”.  These are very important words and, with respect, the judges in the court below just simply failed to address them.  Conservation – the two main dams on the River Murray system, starting at Albury, are the Hume and the Dartmouth.  They hold about 8 million megalitres, almost as much to confer irrigation rights across the Murray‑Darling Basin.

But if Danny Lee at Merbein wants 10 megalitres a month, three months in a row, what he has to do is he speaks to his local infrastructure operator, pays a fee, they then contact the river manager and then the dam operator releases that water.  It then flows down the river to his sluice gate, off‑take canal and onto his land.

Now, your Honours, if there is ever an example of interstate trade and commerce, that must be it because your Honours will know, from decisions of this Court, that the Murray River is in New South Wales.  The water runs from the Dartmouth in Victoria into New South Wales in the Murray, flows down the river and then back into Victoria at Merbein.  That is interstate trade and commerce.  Water, as your Honours have recognised in the High Court in this Court in ICM Agriculture v Commonwealth is a commodity.  It is no longer a natural resource.  The words “for conservation

or irrigation”, the last four words in section 100 are critical to people like Danny and Joe.

When we think back on the history of all this, to Sir Alfred Deakin in the 1880s, and Sir Isaac Isaacs, a Judge of this Court, who promoted these colonies in semi‑arid regions of this State and in South Australia, what they had in mind was protection for the families and farmers in that section – which, I should add to your Honours, has not been the subject of construction since that time.  I see that my time is up.  I respectfully submit that special leave should be granted in the interests of the particular circumstances of the case.

KEANE J:   Thanks, Mr King.  Yes, Mr Donaghue.

MR DONAGHUE:   Your Honours, this proceeding is not an appropriate vehicle to raise the constitutional questions concerning section 100 of the Constitution that the applicant says would warrant the grant of special leave. In particular, no question would arise either as to the relationship between section 100 and section 51(i) – interstate trade and commerce power – or as to the authority of Morgan in the event that special leave were to be granted.

The reason that we say that is because those questions would not be reached because the courts below were correct in finding that the Water Act simply does not have the effect on the applicants’ rights that they assert and because the Act does not have that effect, two things follow:  one, there is in issue no matter or alternatively, the applicants lack standing to challenge the relevant provisions, that in federal jurisdiction being a subset of the same point and, alternatively, but for the same reasons, there is no tenable allegation that the Water Act has abridged any right of the applicants because it has not had any effect at all. So, one would fail at the threshold in section 100 without getting to the more complicated questions arising in relation to Morgan.  Quite independently of the absence of any effect on the applicants ‑ ‑ ‑

NETTLE J:   Just before you go beyond effect, what about Mr King’s submission that there is an effect immediately, albeit that the majority of its consequences are deferred for a period until 2019?

MR DONAGHUE:   That submission, with respect to my friend, is wrong as a matter of the construction of the Act.  Perhaps to show your Honour why that is so, could I invite you to turn to paragraph 20 in the Full Court’s reasons on page 123 of the application book where the Full Court set out some remarks made by the trial judge near the end of his Honour’s judgment where his Honour sought to explain why that misconception that underpins our friend’s case is a misconception, the reason effectively being this. 

The Water Act and the Basin Plan made under it operate at a much higher level of generality than at the level of the individual water rights of individual people.  So, while it is true that when the Basin Plan was made, it did contemplate a 2,750 gigalitre reduction across the whole of the basin would need to occur, broken up between 29 different areas, it did not do so by any mechanism that impacts directly upon the rights of any individual water right holder under State law.  It just said when it commences there will need to be this reduction and contemplated that States, in developing what are called water resource plans under the Act, would work out a way to do that.

But what then happened, through the deferral of the commencement of the Basin Plan limit, is that the Commonwealth committed via two different mechanisms – one, the improvement of infrastructure which prevents massive amounts of leakage from the system, so there was evidence before the courts below that the amount lost is equivalent to all the capital cities combined, so that water was to be saved and if enough water was saved, then there would be no need for any irrigator to lose any of their existing water rights.  That was one mechanism.

The other mechanism was that the Commonwealth would purchase from willing sellers water rights that exist under State law and, through that combination of – and I should say there that that water, when held by an irrigator, counts towards the amount that can be taken from the river on a sustainable basis, but when not held by an irrigator, when held for environmental purposes, it is no longer, under the statutory scheme, water that is available for what the Act calls “consumptive use”.  It sits in the river for environmental purposes and so irrigation water becomes environmental water and the effect is, as is summarised by his Honour Justice North, and accepted by the Full Court, that if you are an individual irrigator who chooses not to sell, the Basin Plan has no effect on you at all, no effect on the water rights of the applicants.

So it is not correct for our friends to say that there was an immediate effect when the Basin Plan was made reflecting a 28 per cent loss to take effect in 2019.  The position in 2019 will be that, as long as they have not sold, the applicants can take exactly the same amount of water in 2019 as they can take now, no difference.  That is why – that misapprehension of the operation of the scheme really underpins the absence of any real controversy, of any immediate effect on rights, duties or liabilities because the Act just does not operate in the way that they apprehend.

The evidence upon which that summary that Justice North sets out and that the Full Court adopted in paragraph 20 is quoted in paragraph 60 of the Full Court’s reasons where you get a little bit more of an explanation.  But from paragraph 60 on page 131, you also see an additional reason why the applicants’ case is misconceived because not only does the Act not affect the cut in their water right that they fear, but if, for some reason – and this is paragraph 56 that is quoted in the middle of the page from Mr James’ affidavit – the Commonwealth policies do not succeed in bridging the gap, there still will not be an effect on the applicants’ rights because, within the Basin Plan, the Commonwealth has accepted 100 per cent responsibility for bridging that gap, such that – and I am looking at the last three and a bit lines of paragraph 56 – under the Basin Plan:

where the Commonwealth, through its own failures, has not met its water recovery target there is no non‑compliance with the SDL –

So at a factual level there are those two reasons why the scheme simply does not affect the rights of the applicants and therefore there is both, we say, no matter and also and alternatively, no abridgement of rights.

The other point that I should make in this context, your Honours, and perhaps conveniently do this by asking your Honours to go back to the section my friend showed you, section 22 on page 242 of the book.  What one can see within section 22 is a table of things that the Basin Plan is required to include, but in each case your Honours will note that there is not – and item 6 is as good an example as any – any legislative specification of the content of the plan.  The plan has to deal with the topic but the Act does not say how.  It does not say what the plan has to say in relation to any of those topics.  It is not right, as my friend put, that this has nothing to do with the environment.  Your Honours will note in the right‑hand column of the table in item 6 it says that this item:

The maximum long‑term annual average quantities of water that can be taken, on a sustainable basis –

That is the SDL, and then in the right‑hand column you will see:

The limit must comply with section 23.

If you go over the page to page 249 of the application book you will see section 23.  The long‑term annual:

diversion limit must reflect an environmentally sustainable level of take.

That is a term that is defined – if you go back to page 222 of the book – and it is defined in terms that are avowedly environmental:

the level at which water can be taken from that water resource which, if exceeded, would compromise:

(a)      key environmental assets of the water resource; or

(b)      key ecosystem functions –

et cetera.  So the Basin Plan is required by the Act to set a limit directed to those environmental objectives.  My friend challenges the validity of the Act.  He does not challenge the Basin Plan.  But to the extent that he has a complaint it cannot be with the framework that the Act puts in place for the creation of a basin plan.  It could only ever be with the detail of what the plan contains because it could only ever be at that level that there could have been said to be an impact on his rights, but he does not put the case in that way.  He says the Act itself as a framework for achieving these environmental effects in implementation of Australia’s international obligations is invalid.

So, for that further reason, the case is misconceived.  Really, one should say, well, looking at the matter at the level of the Act, the Act plainly does not abridge anything.  It creates a framework for dealing with this topic.  Then, when one turns to the Basin Plan and what has been done under the Act, the Basin Plan does not abridge anything either because the way that the Commonwealth is setting about achieving the necessary reductions is not a way that has any impact at all upon the rights of irrigators, except to the extent that they willingly choose to sell their water rights to the Commonwealth.

The other matter, unconnected to that absence of effect, your Honours, is that, in our submission, Justice North was right in his conclusion that the impugned parts of the Water Act are not laws with respect to trade and commerce at all.  So that, quite independently of the Morgan question about whether the limit is 51(i) or not, just from the text of section 100, clearly it is necessary to have a law or regulation of trade and commerce and this Act does not have that character.

Now, I should immediately note, as we pointed out, both before Justice North and on appeal, that there are a couple of provisions in the Act of which that is not true, that obviously are laws that engage 51(i).  They are referred to by the Full Court at the top of application book 147 in paragraph 134.  My friend pointed to some of them.  Those provisions are not provisions that were ever individually challenged. 

There was a challenge, a wholesale challenge to the whole Act, then there was a challenge to particular parts of it.  The whole Act was said to be properly able to be characterised as a law with respect to trade and commerce, then there was a list of parts challenged and then there were a list of individual provisions challenged.  All of that your Honours can see, if you need it, on pages 77 and 78 of the book where you can see how the challenge is broken up.  There was no challenge to the provisions that are enacted in reliance on 51(i). 

Leaving aside that small number of provisions, we submit that Justice North was right in his reasoning at page 42 of the application book and I invite your Honours to go to that.  After a long discussion setting out the various parts of the Act under the heading “Characterisation of the Act” for looking at how the Act should be characterised, his Honour gets to his conclusion starting from 122, expresses the view that these provisions were:

an exercise of the power to legislate in respect of the external affairs –

and then in 123 to 125, first dealing with the Act at the level of generality of the whole Act, he says:

viewed as a whole the Act bears the character of a law with respect to external affairs.  At that level of generality it is not a law with respect to trade and commerce.

Then he deals with the particular parts challenged:

The same conclusion applies to Pts 2, 6, 8 and 11 which were also challenged separately.  Each of those Parts is a law with respect to external affairs, and is not a law with respect to trade and commerce at all.

The same conclusion in relation to the specific provisions challenge in 125 and then your Honours will see that there is an alternative reason given at 126:

Furthermore, even if the challenged provisions were laws with respect to trade and commerce, they were not and could not have been made under s 51(i) of the Constitution.

So what his Honour is there doing, we submit, is saying on any view, just on the language of section 100, this is not a law with respect to trade and commerce. But then further, or in the alternative, it is clearly not a law with respect to interstate trade and commerce, therefore could not have been made under 51(i); therefore, on the authority of Morgan cannot engage

section 100. But we submit that unless his Honour is wrong on that prior question about whether it is a law with respect to trade and commerce at all, the Morgan question would never be reached. 

So for the separate and independent reason that one, the Act does not abridge rights, does not have any effect at all on rights of a kind that would engage a matter, and, two, that the law is not a law with respect to trade and commerce, the constitutional issues that the applicants are inviting the Court to consider do not properly arise in this case.  It is not a proper vehicle to raise those questions and for those reasons we submit that special leave should be refused.

KEANE J:   Thanks, Mr Donahue.  Yes, Mr King.

MR KING:   Thank you, your Honours.  Your Honours, for my friend to submit that there is no abridgement, no matter and no standing are really matters for a notice of contention.  Indeed, the submission that there was no abridgement stands in contrast to the case that he ran in the court below that the administrative measures, the $12 billion spent and the plans that were proposed to assist people like Danny and Joe, which of course have not all been spent, they have been taken away in budgets since that time, were based upon the fact that it was assumed there was an abridgement, that it would occur.  If your Honours go to page 129 of the application book where I started, your Honours will see that:

On 22 November 2012 the Minister adopted the Basin Plan –

That was his obligation –

and, save for Ch 12 which deals with water trading rules, the Basin Plan commenced operation on 24 November 2012 . . . 

48.The Basin Plan is a long document . . . For present purposes the most significant matter addressed by the Basin Plan is the fixing of SDLs –

That is sustainable diversion limits under regulation 6.04(2) and (3).  Now, that fixing of the limits is the water cuts.  It is true, it is at paragraph 51 their Honours noted, in the second sentence:

The first is that the Basin Plan provides that SDLs do not take effect until 1 July 2019 (cl 6.04(1)).

But your Honours could imagine that it might be a sensible administrative program to defer the actual cuts taking effect so as to give people time to adjust.  In the meantime, governments come and go and money comes and goes.  Administrative measures may or may not be provided.  That was Justice Evatt’s very point in the Victorian case – Riverina Transport v State of Victoria and for my friend to submit on the basis that the Commonwealth through its largesse is going to help out these farmers in the meantime is an admission against himself on the three topics which he submits do not give rise to an appealable issue.

KEANE J:   He says you have a guarantee under the terms of the Basin Plan itself.

MR KING:   With respect, he is referring to a clause which – all it does – and he does not put it in the application book - all that that clause does is give to Danny and Joe a defence to the criminal action against them for acting inconsistently with the Basin Plan as from 1 July 2019.  What it does not do is prevent, delay, curtail or in any way restrict the application on that day and, indeed, as a lot of things are happening before then, of those cuts.

Now, they will happen.  The…..water is reduced by more than 25 per cent.  As we have pleaded Mr…..report – and it is referred to in our statement of claim, it is not contested, Danny and Joe gave evidence, not cross‑examined - if they lose more than 20 per cent of their water entitlements they are ruined.  Why?  Because they are small farmers.  There are only 15 hectares, your Honours.  These are the yeoman farmers that Deakin and Isaacs and others filled and populated the arid parts of Australia using irrigation, just as has been done in Mesopotamia, in Yucatan, in other great irrigation communities across the globe.

What this Act – and the question that this case raises, for the first time since Federation, is does section 100 protect them? We would respectfully submit that where, by law or regulation of trade and commerce, which this is upon proper analysis, abridges, that is cuts, reduces, curtails – “abridge” is an old English word – the right of the residents – and it is the only section in the whole Constitution, your Honours, where the word “right” is actually used, so it is a constitutional guarantee, open to liberal interpretation and should be given liberal interpretation – abridges the right of the residents of the State – and that is who Danny and Joe are – to the reasonable use, reasonable use of the waters of rivers for conservation, putting in the dams, making sure they get a proper and consistent flow to their farms, or irrigation for use on their farms, then that law is invalid.

It is as invalid as a law which is prohibited by section 116, which again is an expressed prohibition. There are only two such sections in the Constitution expressed in that way and they are both very important. I know your Honours have recently dealt with section 116 in Williams, but this case raises, for people like Danny and Joe, small people, but they are representative actions, an important case, obviously, for them, an important

constitutional question and they respectfully press upon this honourable Court the opportunity to present that case, which they feel they have not had that opportunity to date.  That is the paradox, that is the issue and we would respectfully seek special leave.

KEANE J:   Thank you, Mr King. 

Given the findings of the courts below as to the likely and actual operation of the Water Act upon the applicants’ rights, any adverse effect upon their legal rights is so remote that their standing to challenge the validity of the Act is doubtful and, even if the most generous view of this question is taken in their favour, the effect upon their rights is nevertheless so tenuous that the interests of justice do not warrant the grant of special leave to appeal.  Special leave is therefore refused with costs.

Adjourn the Court, please, to 2.15 pm on Tuesday, 9 June in Canberra.

AT 2.32 PM THE MATTER WAS CONCLUDED