Mineralogy Pty Ltd & Anor v State of Western Australia; Palmer v The State of Western Australia

[2021] HCATrans 107

[2021] HCATrans 107

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Brisbane  No B54 of 2020

B e t w e e n -

MINERALOGY PTY LTD (ACN 010 582 680)

First Plaintiff

INTERNATIONAL MINERALS PTY LTD (ACN 058 341 638)

Second Plaintiff

and

STATE OF WESTERN AUSTRALIA

Defendant

Office of the Registry
  Brisbane  No B52 of 2020

B e t w e e n -

CLIVE FREDERICK PALMER

Plaintiff

and

THE STATE OF WESTERN AUSTRALIA

Defendant

KIEFEL CJ
GAGELER J
KEANE J
GORDON J
EDELMAN J
STEWARD J
GLEESON J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON THURSDAY, 17 JUNE 2021, AT 10.00 AM

(Continued from 16/6/21)

Copyright in the High Court of Australia

____________________

KIEFEL CJ:   Yes, Mr Solicitor.  I am afraid that for most of us your note on resolution of issues did not quite reach us before we left the Court, so you might need to take us through it.

MR THOMSON:   I certainly will.  I apologise if that is the case.  It represents a little bit of complexity, but I wonder if I might, if it is convenient for the Court, finish what I was saying about State agreements and then come directly to that.  Is that a convenient course?

KIEFEL CJ:   Yes, thank you, Mr Solicitor.

MR THOMSON:   Thank you.  In relation to State agreements, I think I said yesterday that I would take the Court to a couple of passages in Sankey v Whitlam in order to just demonstrate a distinction which I drew yesterday between different types of primary category of case – that is, the category of case which has a covering Act on the agreement that says “as if enacted” and the other type where it is along the lines that it has used in our covering Act in this case.

If I can take you to Sankey v Whitlam, which is in that joint book of authorities in volume 15, tab 105, the distinction that I have mentioned was drawn in respect of considering a financial agreement which was made under the Financial Agreement Act 1927, a Commonwealth Act.  If I can take you first to the judgment of the Acting Chief Justice at page 29 or 6178 of the joint book of authorities and starting about five lines down that page he says:

Where a law of the Commonwealth does no more than approve of or validate an agreement, the purpose of breaking that agreement could not be said to be “unlawful under a law of the Commonwealth”.

So, he is drawing out the point that the agreement is not unlawful – sorry, is not statutory where the covering Act simply talks of approving or validating an agreement.  Can I take you then to the judgment of his Honour Justice Stephen at page 6226 and page 77 of the reports.  Starting at the first main paragraph, his Honour said:

The Act of 1929, which validated the Agreement following the amendment of the Constitution, was passed in exercise of the specific power of legislative validation conferred by s. 105A(2) of the Constitution. Such retrospective validation would appear to have the same effect as does prospective authorization, of which Dixon J. said, in P.J. Magennis Pty. Ltd. v. The Commonwealth that it put “beyond doubt the authority of the signatory to execute the instrument”, securing parliamentary approval of the transaction but going no further, “It does not otherwise change the legal character of the instrument or of the transaction it embodies”.  Thus the validation does not have the effect of converting the Agreement into a law such as s. 86(1)(c) calls for.

That was the provision creating an offence in the case:

With this quite limited effect may be contrasted that of statutes which not only schedule agreements but expressly enact that the terms of the scheduled agreement shall be observed by the parties.  As Lord Cairns L.C. said of such a statute in Caledonian Railway Co. v. Greenock and Wemyss Bay Railway Co., “every provision and stipulation in that agreement becomes as obligatory and binding” as if repeated in the statute.

That was the distinction I gave the Court yesterday, based on that case in Caledonian Railway.  The same type of distinction is drawn by his Honour Justice Mason, as he then was, at page 6238 or page 89.  In a passage which is frequently quoted, his Honour Justice Mason says in the first main paragraph:

The distinction between a statutory provision which merely gives validity to a contract and makes its provision binding on the parties, thereby overcoming some obstacle to its validity or operation, and one which goes further by imposing a statutory obligation on the parties to carry out the terms of the contract, thus giving them the force of law, is well brought out in the judgment of Lord Cairns L.C. in Caledonian Railway Co. v. Greenock and Wemyss Bay Railway Co.

To like effect is a judgment of Justice Aickin at pages 105 to 106 of the reports, and pages 6254 to 6255 of the joint book of authorities.

Now, yesterday, Justice Edelman raised a question about the history and purpose of different forms of words used in covering Acts for the State agreement, and there is a helpful discussion of this topic in the article which is included in the joint book of authorities in volume 24, tab 173, page 9604.  It is an article by Mr Leigh Warnick about State agreements.  The one thing I will ask you to notice about it is that it was written in 1988 prior to the decision in Re Michael and so there are some doubts expressed in the article, but they were resolved by Re Michael.

Can I take you some passages in the article which I think may explain both the history and purpose of State agreements, particularly in Western Australia, and may answer some of the questions that were put to me yesterday, I think including by your Honour Justice Gleeson.  So if you go to page 9608 first, there is at the top of the page some explanation of a question on the previous page, which was “Why have ratifying legislation?”  If you go to the top of page 9608, and starting about six or seven lines down, Mr Warnick says:

State law cannot be varied by a contract made by the executive arm of government; only legislation can override legislation.  It follows that if existing laws need to be raised to authorise the performance of a State Agreement, the agreement must be approved or ratified by legislation.

State agreements are, in fact, invariably given legislative support.  This places beyond doubt the power of the State to make the agreement, and the authority of the person signing on behalf of the Crown.  If the endorsing Act is properly drafted, being a point to which we shall return, the legislative endorsement gives effect to any necessary modification of existing State law.  In addition, there are two other reasons for legislative endorsement.  In the first place, there are constitutional limits on the State’s executive power; for example, a State government is not competent to dispose of interests in Crown land or to grant exemptions from statutory liability without specific legislative authority.  Second, legislative endorsement enhances the security of the agreement against inconsistent action by the State Government in its executive capacity.

In the next section, which is about the form of ratified legislation, Mr Warnick subdivides the types of legislation into four categories and they include the two primary categories which were mentioned by the judges in Sankey v Whitlam. 

I might draw your attention to this.  In the first category, which is the category about an agreement given the force of law as if enacted in the ratifying Act, on page 9609 in the second main paragraph there is a remark about the history of the drafting that has occurred.  Mr Warnick says:

The consistency of Queensland’s drafting approach is remarkable; but even more remarkable is the lack of consistency in the approaches used in Western Australia.  The “as if enacted” approach made a brief appearance in Western Australia in 1961, then returned for a longer season in the late sixties and early seventies.

Our own review of all of the State agreements prior to the Government Agreements Act in 1979 confirms that.  If it were of assistance to the Court, we can actually provide you by tomorrow a schedule with every form of endorsing words contained in the covering Act, but the Court might or might not wish to have that after having seen other parts of the article.  If you go further down that page, there is a comment in the second‑last paragraph:

What is the effect of this form of legislative endorsement –

that is the “as if enacted” approach:

on the contract being endorsed?  The first step authorising the State’s signatory to sign the document does not change the character of the agreement at all; it merely places beyond question that person’s authority to commit the State.  The second step is the important one, namely, giving the whole agreement the force of law, as if enacted in the approving or ratifying Act.  What that does to the agreement has been considered in three relatively recent Australian cases.

Mr Warnick goes through those.  I will not detain the Court with that at the moment.  If you then go to the second type of situation on page 9611, he talks about the situation of a “Statutory Approval, Coupled With a Specific Grant of Authority and a Direction to Perform”.  You will see that that is slightly different from the third category, which is on the next page which is the “Statutory Approval, Coupled With a Specific Grant of Authority Only”.  Our case falls into that third category.  If you look at the second category, you will see at the bottom of the page that Mr Warnick says:

The words of Lord Cairns LC in Caledonian Railway Company v Greenock and Wemyss Bay Railway Co, quoted with approval by the High Court in Sankey v Whitlam, make it clear that this endorsement scheme has, in relation to those obligations in the agreement which are required by the Act to be performed, substantially the same effect as the “as if enacted” formula:

“… when an enactment is found in the body of the Act that each company shall be required to implement and fulfil all the provisions and stipulations in the agreement, every provision and stipulation in that agreement becomes as obligatory and binding on the two companies as if those provisions had been repeated in the form of statutory sections.”

The result of such a requirement, as the High Court recognised in Sankey v Whitlam, is to turn the obligations to which it applies into statutory duties.  This result would appear to follow equally clearly, whether the requirement applies to the obligations of both sides or – as in the case of the South Australian Agreements – to the obligations of the State only.

Then we have the next category:

On this approach, the endorsing Act simply states that the agreement is approved or ratified and its implementation authorised.  This is the approach currently favoured in Western Australia.

He goes on in the next paragraph and says:

The difference between this approach and the one referred to in par (3) above –

I think it must mean (2):

is that the direction to the executive arm of the State Government to do all things necessary to give effect to the agreement is missing.  As pointed out by Mason J in Sankey v Whitlam, the distinction is –

the distinctions I have already taken the Court to.  Then the last category of case is where there is a bare statutory approval, and he says:

Finally, there have been a number of agreements in Western Australia which have been endorsed by legislation saying simply: “The Agreement is approved” or words to that effect, without more.

Can I then take your Honours to page 9622, and this explains the background to the Government Agreements Act1979, and there is also a second reading speech that I can give you a reference to.  I can provide it but it does not actually illuminate to any great degree.  The second reading speech is contained in the Hansard of the Western Australian Parliament on 4 December 1979, at page 5705.  We can provide copies but I do not want to unduly burden the Court.  On page 9622, Mr Warnick explains that:

Until the rise of the environmental lobby in the late 1970s, developers’ lawyers directed their energies toward protecting rights under State Agreements against unilateral variation by the other contracting party, namely, the State Government.  But in 1979, the Western Australian case of Margetts v Campbell‑Foulkes focused attention on a new issue, that is, the need for protection against deliberate disruption of operations by third parties.

That was a case about environmentalists going on site and whether they had done something that was contrary to a law, somewhat similar to Sankey v Whitlam.  On page 9624, you will see at the bottom of that page, Mr Warnick says:

The effect of the principle in Sankey v Whitlam was brought forcibly to the attention of the Western Australian State Government in 1979 by the decision in Margetts v Campbell‑Foulkes, referred to above.  This decision went further than showing that Western Australian State Agreements were not adequately protected against disruptive activity by third parties; it demonstrated that some aspects of performance of the agreements by the parties themselves might be without any proper foundation in law.

So as well as imposing a criminal sanction on disruptive activity, those who drafted the Government Agreements Act had a second task:  namely, to establish a firm footing of legal authority for the performance of all State Agreements in Western Australia.  This was effected by s 3 ‑

He refers, in the second last main paragraph, to some doubt about whether the obligations are statutory duties – as I have said, that has now been resolved by Re Michael – and then, in the last paragraph, he says:

Another uncertain feature of the Act is the extent of its application to future State Acts. Clearly enough, it applies to pre‑1979 State Agreements and protects them against inconsistency with pre‑1979 State Agreements. Presumably, it is also intended to apply to later State Agreements; this is borne out by the reference to it in s 13 of the Diamond (Ashton Joint Venture) Agreement Act 1981. But when in s 3 of the same Act the text reverted to a basic “approve and authorise” form of statutory endorsement, and did not go on to provide that the agreement should take effect notwithstanding any other law, this may have left a possible loophole. If a 1985 State Agreement is protected against inconsistency with other State laws, not by its own ratifying Act but by the 1979 Government Agreements Act, then the protection will be effective so far as it consists of the implied repeal of pre‑1979 Acts;  but where the 1985 State Agreement purports to vary a 1983 State Act, it must be rather doubtful whether it can be made effective to do so by a 1979 Act.  On the McCawley principle, the later act will effect an implied repeal of the earlier to the extent of any inconsistency in operation, not vice versa.  It would seem to have been much safer for the text to have adhered to the more comprehensive formula developed for the 1979 Woodside Act, which combined approval and authorisation with a statement that the agreement should operate and take effect notwithstanding any other Act or law.

That is the approach that has later been taken.  That explains why in our covering Act you have the reference to the Government Agreements Act but then you also have the particular words that have been used.  So, since 1979 and the Government Agreements Act there has been a consistency of approach and except in the specific cases like the McCamey’s Monster‑type case where you have the legislation in the joint book of authorities, there has typically been the approach of the words that have been used along the lines of the Act in the present case or similar to the words in the Government Agreements Act. 

We are happy to provide schedules of all those Acts if the Court thinks that would assist and I have offered to provide the Hansard if the Court thinks that would assist but, as I say, I do not want to unduly burden the Court.

KIEFEL CJ:   We will take that on board and let you know, thank you, Mr Solicitor.

MR THOMSON:   Thank you.  So, that is what I would like to say about what I classified as one of the fundamental errors concerning the State agreement and we say that fairly clearly there are good reasons and in terms of the text of the legislation - and there are good policy reasons and consistent with authority the State agreement in this case was a contractual obligation but the covering Act cleared the way, if you like, so that the performance of those contractual obligations was not impeded by other State statutes.  Can I then turn, if it is convenient, to the question about what issues need to be resolved? 

EDELMAN J:   Just before you leave this issue, though, two brief questions.  The first one is that on the what might be described as the first model which is the incorporation of all contractual terms into statute, could that potentially have the effect the second model does not of creating a liability for a party who is in breach of contract to the tort of breach of statutory duty or a liability for breach of statutory duty?

MR THOMSON:   Can I answer it this way?  One of the puzzling features of the submissions that have been made by the plaintiffs in this case is that there is a hybrid source for the obligations and they claim that it is both contractual and statutory and they say that, therefore, it does not erase, if you like, their claim for damages for breach of a contract even if the source of the obligation is statutory.  There are difficulties in – first, we would say you have to identify the source of the obligation as either statute or contract and if it is truly statutory then the consequences of what your Honour has just mentioned are the logical ones, but no one has tested them.

EDELMAN J:   The other question just relates to clause 32 and the words “add to substitute for cancel or vary all . . . of the provisions of this agreement”.  Is it common ground between the parties that the effect of the Amending Act, the 2020 Amending Act was to add to, subtract, cancel or vary any or all of the provisions?

MR THOMSON:   Can I put it this way.  I think it is common ground that certain provisions of the 2020 Act had that effect, but not all of the provisions of the 2020 Act.

EDELMAN J:   Which provisions of the 2020 Act had the effect of actually adding to, or subtracting, or varying the terms of the agreement?

MR THOMSON:   So the agreement in 4(6) provides for the submission of a proposal, which can then lead to a development, and it was held by the arbitrator that that gave rise to a contractual obligation that could be breached.  To that extent, section 9 and section 10 – particularly section 9 – affect the analysis of the nature of the obligations under the agreement.  Section 27 then says the submission of a proposal does not carry with it any legal consequence to pay damages.

EDELMAN J:   So you do not seek to draw any distinction between the terms of an agreement and the application or implementation of those terms.  The variance or cancelling or amendment of the application of terms of an agreement, you are assuming is the same as the amendment of the terms themselves?

MR THOMSON:   The terms of an agreement can give rise to primary and secondary obligations in a contractual sense, using the sort of Photo Production Ltd v Securicor categorisation, which I think was adopted in Mann v Paterson in this Court.  And to that extent, if any of the obligations that arise from the actual written words are changed, then we would accept that that would be a variation of the provisions of the agreement, and doubt that it is simply there just to talk about the terms in the written word.

GORDON J:   I had understood your submission yesterday to be that 9(1) especially, and (2), brought about, in effect, putting the Mineralogy companies back in a position under contract that existed before the proposals themselves had initially been provided to the State.  So that if one adopts that construction, then it is arguable that 32(1) of the Act did not bring about any change to any of the provisions, because clause 6 of the contract remains operable, but operable at a different point in time because what happened by reference to the two proposals is adjusted, as we discussed yesterday in 9(1) and then in 10(4) to (7). 

If you step back from it, and 9(1) and 10(4) to (7) work as they do, then from a contractual perspective, the Mineralogy company is subject to some minor matters.  From a contractual perspective, they are back in the position they were immediately before they made the initial proposals.

MR THOMSON:   Yes, I accept that you can ‑ ‑ ‑

GORDON J:   So if you accept that position, then it is interesting that you accept from Justice Edelman this idea that the 2020 Act somehow altered any of the provisions.

MR THOMSON:   If you look at clause 27, it says that:

The State has, and can have, no liability, and is taken never to have had any liability, to any person to pay damages, compensation or any other type of amount connected with any of the following occurring or arising at or after introduction time –

and it includes:

(a)the Minister’s consideration of any proposals, or purported proposals, under clause 7 or 8 of the Agreement;

(b)an omission of the Minister to consider any proposals, or purported proposals, under clause 7 or 8 of the Agreement;

(c)any other conduct of the State, or of a State agent, under, or in relation to, clause 7 or 8 of the Agreement.

Now, it alters the legal consequence of the effect of the provisions.  Does that alter the provisions?  I have accepted that it alters the legal character of the obligations under the agreement and I do not think I am saying anything different to that, your Honour.

GORDON J:   Thank you.

STEWARD J:   Well, I think the question is, just looking at 27, how does that operate to add, substitute, cancel or vary a provision of the agreement?  Are those words not really directed to true amendments to the agreement, whereby you rule a line through words, or you add words?

MR THOMSON:   Certainly your Honour may be right, that what it is aimed at is not varying the effect of the agreement, but variations that change the actual provisions, and that is a matter of construction of section 32(1).  Perhaps I can say frankly, I had assumed that section 32(1) should be construed as talking about a variation of the obligations under the agreement, but I can understand the construction that your Honour has just suggested.  Have I dealt with your questions, your Honour Justice Edelman?

EDELMAN J:   You can move on, yes.

MR THOMSON:   Yes.  Should I move on to the question of the issues that might arise?

KIEFEL CJ:   Yes, thank you.

MR THOMSON:   So we have started out in our note by referring to the nature of the principles that your Honour mentioned yesterday, were the subject of the decision in Zhang, drawing on what was said in Lambert, and also in Knight v Victoria.  And as we understand it, in general terms and principles that the Court will only:

determine questions in a special case –

if there is:

a sufficiently concrete question which exists on the facts which makes it necessary to decide the question in order to do justice in the given case and determine the rights of the parties.

As we understand it, there is a further application of that principle in relation to questions of legislative construction and that is that it will be:

usually inappropriate for the Court to determine whether a legislative provision would have an invalid operation in circumstances which have not arisen, and may never arise:

(a)if the provision, in that operation, would be severable and otherwise valid; or

(b)if a legislative provision would be invalid if construed one way, but would be capable of being construed another way to have some valid operation to facts before the Court.

So if there is a variety of ways in which a provision might be applied, and there is no concrete question before the Court which leads to understanding how it will be applied – perhaps I can put it this way, in terms of the general principle – it is then not necessary to decide the question in order to do justice in the given case.

So, that is as we understand the principle.  In the present case, I thought it might be helpful to just identify the particular proceedings about which there is evidence before the Court and then how those proceedings may or may not give rise to particular questions about various provisions.

So, the first set of proceedings which the Court knows about is that there was an arbitration which was set down for hearing in relation to certain damages claims and claims about unreasonableness in relation to the 46 conditions precedent to the approval taking effect which was to occur on 30 November 2020 and we have pleaded in these proceedings that they were terminated by virtue of section 11(4).  It could also be that they were terminated by virtue of section 10(1) and we admit, therefore, that 11(4) is capable if it is the relevant termination provision that it could apply.  If it is section 10(1) I should make this point, and that is that that provision is not one that has been the subject of any question in the special case.

GORDON J:   I thought it was challenged by Mr Palmer and not by the Mineralogy companies.  It may make no difference but I understood that was the position.

MR THOMSON:   Sorry, the ‑ perhaps I can just ask, what was not challenged? 

GORDON J:   Section 10(1) was the subject of challenge by Mr Palmer, I think, separately from the Mineralogy companies.

MR THOMSON:   Yes, I think your Honour might be right. 

GAGELER J:   So you treat section 11(4) as self‑executing even though you accept that section 11(3) is not?

MR THOMSON:   Section 11(4) is the termination provision and that gives rise to the question that I think I discussed with your Honour yesterday about how it might operate practically and whether it is a question of raising it by way of a defence or not and I refer to the recent decision of this Court in the Minister for Home Affairs v DMA18 where there was a construction of a Commonwealth provision which, we say, was in materially similar terms.  That was a provision that prevented proceedings.  The relevant case is in the joint book of authorities at volume 20, tab 143.  Does your Honour think it would be helpful if I took you to ‑ ‑ ‑

GAGELER J:   No.  I mean, that would – do you accept the application of the reasoning in that case to section 11(3)?

MR THOMSON:   Yes.  To 11(3)?

GAGELER J:   Yes.

MR THOMSON:   I am sure that we do but I just would like to check one thing about it.  Yes.

GAGELER J:   Then, moving to 11(4) which is built on 11(3), does it have the same operation, or is it self‑executing?

MR THOMSON:   No, it is the same type of operation because practically it is necessary for a court to be aware or to make a decision whether or not the provision applies because there are certain criteria that need to be satisfied and that calls for the exercise of some judicial function to make sure that the criteria are satisfied and, therefore, a decision needs to be made so it will be pleaded as a defence and then the court would consider whether that defence was made out, whether by way of some form of summary disposition of the case or by way of considering it after a trial and then the matter would be dealt with.

GAGELER J:   Are you saying that it applies to the arbitral proceedings - it is something to be raised in the arbitral proceedings and determined in the arbitral proceedings, is it?

MR THOMSON:   Everyone has accepted that the effect of it was to bring about the termination of those proceedings.

GAGELER J:   I see.

MR THOMSON:   I have described the effect of section 11(3) and 11(4) as requiring it to be pleaded and for somebody then to - a court or maybe some other arbitral tribunal to then decide it applies.  If that happens, and there may be a question about exactly how the disposition occurs once the court or the tribunal has come to a decision about the fact that it does apply, if it does apply, the word “termination” is in itself neutral.  It might be that some further order of the court is required to dispose of the matter, or it might be the court simply makes a declaration that this is within the terms of section 11(3) or 11(4).

EDELMAN J:   Why would it not work in exactly the same way as the limitation period?

MR THOMSON:   That is certainly one way of understanding it, your Honour.  I do not think it is material to the ultimate outcome of the case, but I was just drawing out a point that has been the subject of some submission, not only by us but also by Victoria, and that the actual disposition of it might ultimately either be by way of a declaration saying that the proceedings are within the terms of 11(3) or 11(4) and therefore those provisions take effect of their own force once the court has made that decision or it might be, and I think probable more likely, that an order of disposition is required from the court.  That is consistent with what your Honour Justice Edelman just said about the limitation period.

In the note that we have provided, I have identified the arbitration as the first set of proceedings.  That related only to the first Balmoral proposal.  We say it was of no legal effect, that two previous arbitral awards concerning this proposal were of no effect and the underlying arbitration agreements were of no effect and that was achieved by the operation of section 9 and section 10(4) to (7).

There is also a related second Balmoral proposal, which was submitted but never litigated or arbitrated and that has also, we say, been neutered, if you like, by section 9(1).  Then I have gone on and I have explained what the termination of the November 2020 arbitration involved.

We also say that the arbitration and its termination give rise to questions about the validity of section 11(1) and (2) because, as I tried to explain yesterday, the consequence of there being no underlying right is that there is no liability and all that has happened is that the legislature has defined that secondary consequence after having defined the primary consequence.  So it has taken away the right and it has said, as a consequence of that right being taken away, there is no liability.

The second set of proceedings that the Court knows about are proceedings that were commenced in the Queensland Federal Court on 12 August last year.  Now, 12 August was the day between 11 August when the Bill was introduced into the WA Parliament – that is the Bill for the Amending Act – and the day on which that was passed, 13 August.

We thought that it might be helpful to show the Court the judgment of Justice Greenwood, which adjourned the proceedings in October.  That gives you some idea of what was in issue in the proceedings, and it is consistent with what you will find set out in the special case, at paragraph 45, but it does provide it in slightly more detail.

This is the judgment of Justice Greenwood in [2020] FCA 1517. If I take you to paragraph 32 – and I will skip through this part fairly quickly – there was the commencement of the action by way of a concise statement, there were some particulars of it that was sought by the State, and there is some record of correspondence backwards and forwards. Then you get to paragraph 40 where the judge summarises the effect of what has happened, and he says:

In other words, the State seeks to regularise the principal proceeding by seeking orders that require the applicants to identify in a coherent, properly particularised pleading, the material facts which are said to give rise to conduct on the part of the State constituting a breach of the State Agreement and conduct capable of being characterised as “unconscionable conduct in and around the arbitration agreement made on 8 July 2020 to submit to arbitration . . . and the mediation agreement made on 5 August 2020 to submit to mediation . . . [of] the disputes in paragraph 1 of the mediation agreement”. The State says that once it has seen such a pleading, it can then determine whether the pleading identifies an arguable and justiciable controversy. The State contends that if the applicants are not capable of pleading the causes of action upon which they seek to rely and should those causes of action not give rise to a justiciable controversy, the State would seek to make an application for an order under s 31A(2) of the Federal Court of Australia Act 1976 (Cth).

The State says that if the causes of action upon which the applicants rely are incapable of being pleaded properly and are unmeritorious, independently of any question arising under the Amending Act, the State ought to have an opportunity to address that matter.

On the other hand, if the causes of action are unable to be pleaded in any coherent way or seek to assert questions of fact and law which are not justiciable, the Amending Act, if valid, has the effect of terminating the proceedings in any event.  If the Act is found by the High Court to be valid, the principal proceeding is already terminated.

Well, that is perhaps arguable.

If the proceeding is pleaded in a way which reflects propositions of law and fact which are plainly arguable and justiciable, the proceeding is already terminated if the provisions of the Amending Act are valid.

So, clearly, Justice Greenwood considers that he has to make some sort of a decision about that, but it would be necessary to have a proper pleading in the case.

Now, I draw all of those things to your attention because the special case in paragraph 45, consistent with the concise stated facts, deals with whether or not protective – whether this is a case which might be within the concept of protected matters.  If you go to the special case you will see that in – on page 131 of the special case book in paragraph 45 it says that:

On 12 August 2020, Mineralogy and International Minerals commenced proceedings in the Federal Court of Australia seeking, amongst other relief, injunctions requiring the State to withdraw the Bill for the 2020 Act from Parliament, and damages for breach of contract and damages under the Australian Consumer Law relating to the introduction of the 2020 Act into the Parliament of Western Australia –

So, there is a basis to say that there will be a question as to whether disputed or protected matters arise in the proceeding.  However, having said that, the Court should know that there might be a question as to whether there is a concreteness about that having regard to the comments that have been made about the particularisation and the idea that there may not be proper facts and more present in that proceeding.  So, whichever view the Court takes it might have an impact on whether the issues in that case are ready for determination or not according to the principles stated in Zhang.

GAGELER J:   There would be more issues in that case than are covered by the argument being presented on the special case, would there not?

MR THOMSON:   I think that is right, your Honour.

GAGELER J:   You have a Commonwealth law in play, for example.

MR THOMSON:   Yes.  It is somewhat difficult to say because the proceedings were adjourned by Justice Greenwood without the particularisation that was sought being ordered.  He said it would be a waste of the taxpayers’ money if Western Australia allowed the proceedings to continue.  Perhaps I should just show you what was said in paragraphs 42 to 45 of the judgment.  I have already shown you paragraph 42, 43 says:

Perhaps the right course is to metaphorically put the principal proceeding to one side until the High Court has determined the question of validity of the Amending Act.

Then, there is reference to the “overarching purpose of the civil practice and procedure” and Justice Greenwood said:

In circumstances where the High Court is seized of the question of the validity of the amending Act and the decision on the question of validity will have a direct bearing upon the principal proceeding, the overarching purpose suggests that the principal proceeding should be adjourned generally and brought on for review within seven days of judgment being delivered by the High Court on the validity question.  In principle, if the judgment of the High Court reveals any area of operation within which a contended claim might be maintainable, an order can then be made requiring the applicants to deliver a statement of claim –

It is quite correct to say that this Court is seized of the question of the validity of the immunity Act for various reasons so that if the manner and form provisions – sorry, if the manner and form contentions succeed then the entirety of the Amending Act might be swept away.  But, the question for this Court is whether the validity of particular provisions that have been made the subject of questions in the special case as opposed to the validity of the entire Act are concretely ready for determination and it may be that in the circumstances that I have just outlined the Court comes to the view, and we would accept that this is probably the correct view, that there is no concrete question that arises about protected matters as a result of this case.

STEWARD J:   When you say they are concrete matters, do I take it what you are really saying is that the Amending Act has yet to engage with this Federal Court proceeding?

MR THOMSON:   That is right.

STEWARD J:   It may in the future, but not today.

MR THOMSON:   That is right.

STEWARD J:   All right.

MR THOMSON:   But there is an element of imprecision sometimes about the application of the Zhang principles because there are exceptions to it.  The Zhang principle itself is stated as saying that “except in special cases or exceptional cases”, and so we acknowledge that that is so.  We are ready to argue the constitutional validity of any of the provisions, if any member of the Court should wish to hear about that, but in terms of sections 18(1) and 19(1), those are only engaged in relation to the Federal Court proceedings if the court considers that they are concretely raised.

GORDON J:   So your primary submission is that there are no unusual features or good reasons to go beyond what sections in this case?

MR THOMSON:   We put a table on the back of our submission trying to, if you like, set out what provisions arise for determination in a concrete way, having regard to the different types of challenge that are made.  If you look at the Chapter III judicial power question, we have not listed the questions of sections 18(1) and 19(1), but if you look at the rule of law and extreme law question, then it is possible that 18(1), 19(1) and 21 and 24 might arise.  That is also set out in paragraph 9 of the ‑ ‑ ‑

GORDON J:   That is why I asked.  When I read paragraph 9, I had understood from the first sentence that they were the provisions in a sense which were your primary argument and then the second sentence was your secondary argument.  Am I wrong about that?

MR THOMSON:   In relation to the rule of law and extreme law, it depends how your Honours characterise that ground.  But if your Honours think that it requires particular facts to be engaged in order to provide a foundation for a determination of that issue, then yes, that is correct.

GORDON J:   Thank you.

MR THOMSON:   The third set of proceedings about which the Court knows and which are before the Court are some proceedings for the appointment of an arbitrator.  That was in relation to a set of proceedings in the WA Supreme Court that were commenced in 2018.  Those proceedings do not seem to have any real life in them because the appointment of the Honourable Justice McHugh was agreed and he then undertook the second arbitration.  Those proceedings had not been terminated and they still sit on the Court file, but there is no real prospect that they will engage any particular provision of the Act as far as we can see.

Now, there is also in the pleadings in the case reference to a fourth set of proceedings and, as we say in paragraph 5, the reference is indirect and there are no facts regarding those proceedings in the special cases.  There was at one time some pleaded facts about the matter but there have been amendments that have led to the third further amended statement of claim.

These are proceedings in the Queensland Supreme Court and they concerned the registration of the first and second arbitral awards but those facts are not before this Court on the special case.  What is before the Court is notice of a claim by the State for indemnity of legal costs in respect of the proceedings and that was by letter dated 9 December 2020 and it was just simply a notification of a claim being made but no claim has, in fact, been made pending the outcome of the appeal in those Queensland Supreme Court proceedings.  One might think that if the appeal did not go well for the State then the claim obviously would not be progressed.  As I said before, there are no facts related to the attempts to register the two arbitral awards in another State. 

Likewise, there are no facts about how any of the provisions of various Commonwealth statutes which are relied upon in respect of inconsistency under section 109 might intersect with the operation of the Act in any concrete way. In fact, none of those Commonwealth statutes were of sufficient importance to find their way into the joint book of authorities.

So, that leaves the question about the claim under section 14(4) and I have dealt with that and said that there is probably no sufficiently concrete issue in that respect either.  So, I have tried then to set out what is known of the various facts that might engage the provisions so that the Court can make a decision as to whether or not various parts of the Act raise questions that are sufficiently concrete in terms of the Zhang principle, and as your Honour Justice Gordon has seen and remarked upon, we would accept that sections 9, 10, subsections(4) to (7) and 11(1) to (2) and (4) are concretely engaged. 

There are certain facts that might concretely engage section 18(1), 19(1) and (2) and (4) and 21(1) and (4) but that depends upon the Federal Court proceedings and what level of engagement with facts is necessary for the purposes of the rule of law argument.  We have put in our annexure the full faith and credit argument which is about the operation of section 35 of the Commercial Arbitration Act (Qld) which is, in fact, pleaded.

Whether the Court requires knowledge of the attempt to register the two arbitral awards in the Queensland Supreme Court proceedings is a matter that is perhaps on the edge of the Zhang principle.  We are very happy to argue the question about full faith and credit but there is, in fact, no specific question about whether full faith and credit can be given to the registration of a particular award in this case.

So, I hope that assists the Court about how the Zhang principle might apply.  There are some – it depends a little bit upon how much of a concrete question the Court requires in order before it will determine questions of constitutional validity, and I have endeavoured to try to say that, if in a confined way, concrete questions have to arise on the particular facts, then the Court will only be determining a fairly small number of provisions.  Having said that, we are prepared to argue the constitutional validity of any provision because it is in the special case and would not want to be seen as not assisting the Court in that respect either. 

If it is convenient then, can I outline the approach that I will take to dealing with the various grounds of challenge.  My friend, Mr Free, will address the Court on what we have described as the additional issues that arise in the B52 case.  Those are the section 117 issue, the section 75(iv) of the Constitution issue, the issue about the Bill of Pains and Penalties and “Extreme Laws”, and, if it is necessary, the question about inconsistency with Commonwealth law – and I say if it is necessary, meaning if it is necessary to go into the particular points of intersection that might exist and why it would be difficult for those to be determined because of the problems of hypothetical questions arising.  I have a more general submission to make about inconsistency, but it will take a very short period of time. 

So, can I turn then to questions about judicial power in Chapter III.  In one sense I can be quite quick about this, we think, because there is no challenge to what we might describe as the rights principle that has been acknowledged by this Court in a line of cases, cases such as Humby and Nelungaloo in earlier times, the Australian Education Union Case, the Commonwealth BLF Case, more recently Bachrach, Duncan v ICAC.

So those are cases which establish that ‑ if I can put it in the words that your Honour Justice Keane used ‑ if there is a change of rights which then has an occasion – presents an occasion for a dispute to be resolved in a different way as opposed to operating upon the judicial process itself in the actual application of a court process, then there is no difficulty about that.  And so, the principle does not seem to be the subject of any challenge here.

There is a further point which I mentioned yesterday and that is that it appears also to be accepted that the provisions of sections 9 and 10, and as we understand it also 11(1) and 11(2) to the extent they arise, bear a dual character; that is, that they are to be accepted as within the rights principle for one purpose, but also having an effect upon the outcome of judicial proceedings.

But, analysed properly, we would say that saying it has a dual character is simply acknowledgment that these are provisions that fall within the rights principle, but the consequence of them falling within the rights principle is that they will inevitably then have an effect in the proceedings as the law is applied.

So that, to use the words of the Court in Kuczborski, what has happened is that there is an antecedent change of the law which then is applied by a court, but it does not in any way usurp or affect the institutional integrity of the court, and that submission is consistent with the nature of the cases where the so‑called Kable principle has been applied.

In the four cases where that has happened, the Court has been held to be conscripted into the operation of a judicial process.  Now, in the present case, where we are talking about arbitrations to start with in the most part, the question of being conscripted into the judicial process in the context of the arbitration being determined never arises because an arbitration is not an exercise of judicial power.  It is an exercise of a private consensual power as this Court held in the TCL case. 

But, going beyond that, if you look at the cases in which the Kable principle has been applied, they are Kable itself where the strands of reasoning of the Court can perhaps be drawn together to say that the Court was conscripted into a process to procure the imprisonment of a named person.

In International Finance there was no power for the Court to review an ex parte order.  In Totani, the Court was required to make a control order in respect of a person if the Executive had decided to make a declaration in respect of an organisation of which that person was a member with the only role of the Court being to determine if the person fell within a very wide concept of membership.  In Wainohu, the Court was not required to give reasons for a decision. 

Now, by contrast, this case does not impose any new judicial or adjudicative function on a court.  I use those words “judicial or adjudicative function” because that picks up the way in which the Kable principle has been stated in a number of cases recently by this Court and, in particular, in Attorney‑General v Emmerson where Chief Justice French and Justices Hayne, Crennan, Kiefel, Bell and Keane all said at paragraph 40 that:

The principle for which Kable stands is that because the Constitution establishes an integrated court system, and contemplates the exercise of federal jurisdiction by State Supreme Courts, State legislation which purports to confer upon such a court a power or function which substantially impairs the court’s institutional integrity, and which is therefore incompatible with that court’s role as a repository of federal jurisdiction, is constitutionally invalid.

Well, in this case there is no attempt to confer a power or a function in the sense that the four cases that I have mentioned where the Kable principle has, in fact, been applied has operated.

EDELMAN J:   This is just a submission that is confined to sections 9 and 10 for the moment, is it?

MR THOMSON:   I think it also applies to section 11.  In 11(1) and (2), not the “no proceeding” part of section 11 but the “no liability” part of section 11 because we would maintain that that is a provision which declares the consequence of there being no right in the same way that the other provisions take away the right.

EDELMAN J:   But you are not addressing provisions like section 12(2)?

MR THOMSON:   No. 

GAGELER J:   In respect of section 11, as I understand your earlier submission, it is only engaged on the facts in respect of arbitral awards and an existing arbitral proceeding.  Is that right?  It is not actually engaged on the facts in respect of any court proceedings.

MR THOMSON:   Yes, I think that is right.  Well, again this goes to the Federal Court proceedings.  Not knowing precisely what is claimed there makes it slightly difficult, and so I do not want to be confined.  But it might possibly be engaged on the facts there, depending on how it is particularised, and so forth.

GORDON J:   Is this consistent with the submission you put to me yesterday when I asked you about the breadth of section 11(1)?

MR THOMSON:   Yes.  When I was responding to Justice Gageler, he was asking about it being engaged on the facts.  I think that the answers I was giving you about the general breadth of it were about how it could operate in all situations.

GORDON J:   So that would extend to include the Federal Court proceedings, is my point.

MR THOMSON:   Yes, yes. 

GORDON J:   Yes.

MR THOMSON:   Can I say that the conceptual basis for the rights principle, which does not appear to be in any way challenged in this case, is that a declaration of rights and liabilities, as I have said, in respect of anticipated or pending litigation does not infringe Chapter III because it does not concern the constitutional considerations – in terms of constitutional considerations, the function of a court, but it rather represents a law that is applied in the exercise of the function. 

That sort of explanation is one that appears to have been adopted by Chief Justice Mason and Justices Dawson and McHugh in the Leeth decision at page 469 – I do not need to take your Honours there.  It also seems to underpin what was said in Kuczborski about legislative change occurring antecedently to the court becoming involved.

We have referred in our submissions – I do not need to take you to this case – but to a Victorian Court of Appeal decision in City of Collingwood v Victoria [No 2], and that is in the joint book of authorities, tab 123.  That is illustrative of at least an intermediate Court of Appeal taking the view that legislation which specifically adjusted contractual rights in a lease between named parties was valid, according to what we have described as the rights principle.

Can I deal with a particular point that has been raised by the plaintiffs, and that is based upon Duncan v New South Wales, and the point that in that case it was said that the Act did not have any of the indicia of an exercise of judicial power.  Perhaps if I go to Duncan v New South Wales, which is volume 8, tab 64 – and the relevant paragraph is paragraph 42.  This was, of course, about taking away mining tenements that had been obtained by companies where the legislature considered that their grant may have been tainted by corrupt conduct.  The Court said at paragraph 42:

In terminating exploration licences issued under the Mining Act and in making consequential provision, the Amendment Act exhibits none of the typical features of an exercise of judicial power.  It quells no controversy between parties.  It precludes no future determination by a court of past criminal or civil liability.  It does not determine the existence of any right that has accrued or any liability that has been incurred.  Save for the limited immunity it confers on the State and its current or former employees, it does not otherwise affect any accrued right or existing liability.

Now, we would say, with the greatest respect, it is a logical fallacy to turn it around and say because the Court said it was not an exercise of judicial power because these features were not present that it would be an exercise of judicial power if those features are present.  It leaves out the operation of the rights principle. 

As I have said, there is no challenge to the existence of the rights principle and, in fact, it does not even seem to be challenged in its application to sections 9 and 10 that these provisions are within the rights principle and, with respect, nothing in this case in Duncan v New South Wales was intended to cast doubt upon the rights principle and, in fact, it was subsequently in Duncan v ICAC reaffirmed.  We would suggest that the point that has been made there cannot really carry any weight.

There are many other provisions that are the subject of constitutional challenge on the basis that Chapter III issues or judicial power considerations mean that somehow they are in interference with judicial power and those provisions have not been the subject of separate submissions individually by the plaintiffs. 

Can I deal with it this way in order to expedite the proceedings?  There are certain provisions such as the “no proceeding” provisions which we have discussed like in 11(3) and 11(4) and there are other provisions about the admissibility of evidence and so forth which we do not think are engaged in the case, but what is critical to understand about those provisions is that they operate in a circumstance where the rights principle has operated and taken away the underlying rights. 

So, we say that in no universe can those provisions operate in a way which interferes with judicial power because they are operating in a secondary or consequential fashion in a circumstance where there is no right in the first place.  So, they occupy a very different space from other provisions that might exist without the antecedent operation of provisions such as sections 10 and 11 and the declaratory provisions in section 11(1) and (2). 

Now, I do not want to detain the Court by going through each of those provisions unnecessarily when they have not been specifically the subject of submission in‑chief, but that is our general answer to it.  You have our written submissions about these points, where we go through and say, in terms of questions of - it would be an abuse of process to allow the use of a litigation procedure to deal with non‑existent rights.

In terms of the operation of the provisions in Federal Courts, the question is one of validity or operation.  In terms of operation, it is very difficult to make much submission about that in circumstances where the concrete nature of the factual basis is not known, because there is a question about whether or not provisions of a State are picked up and applied in federal jurisdiction. 

Now, that could happen if they are properly declaratory of rights because there is a proper law that needs to be applied and so there is a choice of law question, or it might because there is a gap in the way the Federal Court operates and section 79 applies and picks up the provisions and makes it work.

But in answering the special case questions, that is about as high as the Court could go because the provisions are not going to be constitutionally invalid because they will operate in courts other than federal jurisdiction.  So, it would be very difficult to frame an answer to a question about the operation of the provisions in federal jurisdiction without being able to identify a more concrete question.

We made submissions about the operation of the remedial provisions in sections 17(4) and (5) and 25(4) and (5), and whether or not there can be the denial of an appropriation of funds – we have gone into some interesting constitutional questions about that – you have our submissions on those to that point – it does not arise in any concrete fashion because there is no question of any judgment against the State.

But there are important constitutional questions about the statutory reach of section 64 of the Judiciary Act, and how it fits into the scheme of sections 64 to 66 of the Judiciary Act and also about the Auckland Harbour Board principle, and the ability of States to control their own financial destiny. 

We say that nothing can compel the State to become the subject of a Commonwealth law requiring it to make an appropriation to pay money in a judgment.  But, again, that type of thing has not been the subject of any oral submission, so we will not dwell upon it on this occasion, unless the Court thinks it would be helpful for me to do so.

The operation of the administrative law provisions, in particular sections 12 and 20 concerning the judicial review, is something that we have been into yesterday.  I do not propose to repeat what I said about those being provisions which are standard privative‑type provisions.

Really what is challenged in respect of those provisions – there is a challenge about the constitutional validity of section 12(1) and (2).  We say that that is overcome by the operation of section 26(6), which means that there is the ability for any decision to be reviewed for jurisdictional error, but then there is a swag of challenges to the “no proceeding”‑type provisions in sections 12(4) to (7) and 13(4) to (8) and they just fall within the general concept of the secondary provisions that I have already mentioned.

I think that that is all I need to say about the ground which is based upon judicial power and Chapter III considerations.  I will move then to the question about indemnity provisions, unless your Honour thinks this is a convenient time.

KIEFEL CJ:   It is a convenient time, thank you, Mr Solicitor.  The Court will take its break.

AT 11.13 AM SHORT ADJOURNMENT

UPON RESUMING AT 11.28 AM:

KIEFEL CJ:   Yes, Mr Solicitor.

MR THOMSON:   Thank you, your Honour.  The next issue that we have identified in our submissions as common issue number two concerns the operation of the indemnity provisions – sections 14, 15 and 16 - to the extent that they are raised by the special case, and also the analogues in relation to protected matters.

The plaintiff has raised three objections to the indemnity provisions. We obviously say, as we have said this morning, that their operation is hypothetical, but in relation to the three objections they are that the indemnity provisions are repugnant to judicial power, that they impose a condition upon the exercise of federal jurisdiction and that they operate insofar as they provide for a set‑off, contrary to section 115 of the Constitution.

Can I make these short points.  In relation to the idea that they are repugnant to judicial power, or that they impose a condition upon the exercise of federal jurisdiction, we say that they operate completely aside from those considerations, that the plaintiffs may bring their case to a court that exercises federal jurisdiction, they may litigate that case in any way they like, that a judge of that federal court has no concern with the indemnity, and that, except to the extent that it might be something that is pleaded as a matter of law, but that it does not affect the judicial process in any way, and that it does not impose a condition about gaining access to federal jurisdiction, so that in those circumstances we say that those claims ought not to be accepted. 

Can I also point out that the indemnities operate, if you like, what is described as “reflexively”.  That is to say that they operate only really to the same extent as the exemption of liability contained in section 9 and 10, and 11(1) and 11(2) and their analogues for protected matters do not operate.  So, if you were to use the contractual analogue, often you find in a contract a clause which has an exempting effect.  If it does not have an exempting effect, then you find the opposite being an indemnity that operates reflexively, and really these are in the same position.

As with the plaintiff’s argument on the rule of law, again, they have been of no assistance to your Honours in order for your Honours to understand why this limitation is required to be drawn either from the text or the structure of those instruments, and that by itself is sufficient do discount the argument. 

Further, the plaintiffs have not explained how the implication is to be reconciled with existing authority.  There are many Australian cases which have rejected an argument that State legislative power is limited by reference to some particular common law right.  We have set them out in paragraph 40 of our written submission, and they include the observations by this Court in Durham Holdings Pty Ltd v New South Wales, both at paragraph 7 and 14.

In addition – and this is our final point – the principle of legality, it is a rule of construction – statutory construction – endorsed by this Court.  That principle we say is inconsistent with legislative power being confined by limitation in the terms proposed by the plaintiffs.  That principle, as your Honours will be aware, presupposes the capacity of Parliament to abrogate even the most fundamental of common law rights provided that Parliament does so by sufficient clarity. 

The plaintiffs have not explained how the supposed limitation on legislative power can coexist with that particular rule of construction, and it follows that the common law argument should also be rejected for that reason.  Unless your Honours have any questions for me, those are our oral submissions. 

KIEFEL CJ:   Thank you.  The Solicitor‑General for Victoria.

MS ORR:   If the Court pleases, we rely on our written submissions.  We also adopt the submissions of the Commonwealth on the extent to which the Court needs to determine the validity of the provisions that are identified in

the special case in order to determine the rights and liabilities of the parties.  So, we rely on our submissions, but we do adopt that aspect of the Commonwealth’s submissions in addition.  If the Court pleases.

KIEFEL CJ:   Thank you.  Ms Longbottom, for the Attorney‑General for Queensland. 

MS LONGBOTTOM: Thank you, your Honour. There is only one respect in which we wish to amplify our written submissions that materially concerns the manner and form. There are three propositions that we advance as to that ground. Firstly, we adopt the submission made by the defendant that clause 32 is not a law within the meaning of section 6 of the Australia Act.

Second, we submit that if, as the plaintiff contends, clause 32 is to be construed as impliedly removing Parliament’s power to amend the agreement unilaterally, then it is not a manner and form provision.  That is because in that circumstance it would do more than proscribe the mode in which laws can be made.  The provision would purport to preclude Parliament from legislating on the subject matter of amendment of the agreement in any manner and form.

The authorities relevant to that proposition are outlined at subparagraph 3(b) of our outline of oral submissions.  I need not take the Court to those decisions, but we say that there are two essential propositions that arise from the decisions to which we refer in that passage.  Firstly ‑ and this emerges from the decision of his Honour Justice Dixon in Attorney‑General (NSW) v Trethowan (1931) 44 CLR 394 at 431, which is in volume 2 of the joint book of authorities at tab 39 at page 679.

The proposition is that a manner and form clause must do no more than proscribe the mode in which laws respecting the Constitution, powers and procedures of the Parliament can be made.  Second, and relatedly, we submit that a law cannot be equated with a manner and form provision if it purports to preclude Parliament from legislating on a particular subject matter in any manner and form.

That proposition particularly emerges from the decision of his Honour Justice Wanstall in Commonwealth Aluminium Corporation Ltd v Attorney‑General [1976] Qd R 231 at 237, which appears in volume 19 of the joint book of authorities. It would follow, we submit, that if, as the plaintiff contends, clause 32 is to be construed to remove Parliament’s power unilaterally to amend the agreement, that it is not a manner and form provision for the purposes of section 6.

The third matter that we wanted to touch upon briefly arises from a question your Honour Justice Gageler raised earlier today in relation to whether or not the Australia Act operates directly or on State law or through the prism of section 109 of the Constitution.  We say that question is answered by the decision of Attorney‑General v Marquet (2003) 217 CLR 545 which appears at item 41 of the joint bundle of authorities, commencing at 567 of the judgment, paragraph 67 commencing at page 786 of the joint bundle. In effect the answer is that it operates through the prism of section 109.

In a practical sense, we say that has a number of consequences. Firstly, it would follow that an analysis of the extent of inconsistency for the purpose of section 109 begins with the proper construction of the Commonwealth Act, that is the Australia Act, and here the meaning of the expression, a law made “by the Parliament of a State” in section 6 of that Act.

The Solicitor‑General for Western Australia has advanced a construction of that expression “law” to mean that it is confined to an Act.  We submit that there is another construction of the expression “law” that is open, and that is, it does not necessarily refer to the statute as a whole – that is, taken as a unit ‑ but that it can also refer to a:

‘rule’ resolved upon and adopted by the legislative organ –

That is, in effect, a norm of conduct or a series of provisions that confer a right or impose a liability.  We rely in that respect on the decision of his Honour Justice Gummow in Momcilovic v The Queen (2011) 245 CLR 106 at paragraphs 226 to 228, which appears in volume 11 of the joint book of authorities, tab 86, commencing at page 4633. We say that it is only a “law” as so understood which section 6 of the Australia Act provides shall be of no force and effect if enacted in non‑compliance with a valid and applicable manner and form provision.

In a practical sense, we say that would require the Court, if it comes to consider the application of section 66, to undertake an exercise akin to that which is referred to in the defendant’s submissions in B52 at paragraph 99, requiring the Court to consider both those aspects of the agreement that contravened clause 32, in the sense of purporting to effect an amendment to the agreement, but also those aspects of the Act which concern:

the “constitution, powers or procedures” of the WA Parliament.

Save in that respect, we are content to rely upon our written submissions as amended by our outline of oral submissions.  Thank you.

KIEFEL CJ:   Yes, thank you.  Mr Jackson.

MR JACKSON:   Your Honours asked for a document.  It is on the way here, if I can put it that way.  I will have it delivered to your Honours as soon as possible after it arrives.  I think it is here, your Honours.  Your Honours, a particular matter I wanted to mention – and perhaps if I could deal with this aspect of the matter and conclude on that today ‑ it relates to the Interpretation Act and the Government Agreements Act and so on.

Your Honours, references have been made in the course of argument to the history of provisions such as section 3(b) of the Government Agreements Act and its relationship to, for example, Re Michael and other cases, and to whether the provisions of section 31(2) of the Interpretation Act are applicable to the legislation here in question.

In a sense, the starting point in time is the enactment of the Government Agreements Act in 1979 and the Court will recall that section 3(b) is in very strong terms. It says, as your Honours will have seen, that it modifies the Acts or laws to – that otherwise are involved in it. That enactment, using those terms, was before the Parliament on 4 December 1979 when the Minister for Industrial Development, who was then Mr Mensaros, gave the second reading speech and, your Honours, I will come to it in just a moment.

But it made very apparent in the second reading speech that section 3(b) was intended to do exactly what it says. May I have delivered to the members of the Court copies of – it is a one‑page speech, your Honours, or two pages, one page relevant. In that speech what Mr Mensaros said – it is page 5705 of the parliamentary proceedings of that day – he referred in the left column to say that:

Clause 3 of the Bill aims to eliminate any possible uncertainty which may exist in relation to the manner in which Acts ratifying agreements have been effected over the past 30 years.

He then said it was necessary to give the house some background.  Your Honours will see that the next paragraph commencing:

Over time, legal opinion has not been clear or consistent . . . agreement have . . . varied materially –

and he gives an instance in the last paragraph in the left column.  Then he goes on to say at the top of the right column:

Sometimes much more elaborate provisions have been made with the effect that the agreement is made a law of the State.

Then, in the second paragraph in the right column, he referred to Sankey v Whitlam, and in the following paragraph, to the decision of the High Court.  Then, your Honours, in the middle – at about point 4 on the page:

The consequence is that in a number of our State agreements in which there are provisions whereby Parliament has simply ratified or approved an agreement, the terms of those agreements may not have the force of law.  This could have serious significance.

Your Honours will see the explanation given that:

the agreements consolidate the mining tenements and, therefore, override the Mining Act.  They provide that companies do not pay rates to the local authorities.  They might contain different provisions from those in the existing Land Act, and if those provisions do not constitute the law of the land then anybody can assail the agreements, and their implementation becomes jeopardised.

Your Honours will see that he went on to say that:

Agreements contain provisions expressly varying or overriding the operation of various laws of the State, and if the terms of some agreements do not have the force of the law, then the ordinary laws of the State might prevail and the relevant terms of the agreements might not be able to be fulfilled.

Consequently the ability of the company concerned to meet its obligations under the agreement, and the power of the State and its instrumentalities, to fulfil the contractual obligations undertaken in the agreement could be frustrated.

Your Honours will see that he goes on to say that he is moving:

to rectify the position –

Now, your Honours, let me just say in relation to it, that assuming that the Act section 3(b) was intended to do what the Minister said in the second reading speech, and the words of section 3(b) do seem to be in terms and effecting or effectuation of what he was seeking to say, it makes it difficult to see that Re Michael 27 WAR 574, at page 581, paragraphs 29 and 30, could be right. Your Honours, it could be right ‑ if I can just go to that case for a moment ‑ in saying that section 3(b):

does not purport to give to the provisions of the . . . Agreement the force of law.

That is in paragraph 29. The whole of paragraph 29 just seems to be, if I may say so with respect, quite inconsistent with the terms of section 3(b) and with the legislative intention one can derive from it. Also, your Honours, if one looks at paragraph 30 of those reasons for decision, when his Honour said that the agreement would have:

no binding legal force on those who are not parties.

That seems to have been one of the major reasons for having the provisions.

Your Honours, could we just say that the terms of section 3(b) of the Government Agreements Act are also entirely consistent with section 31(2) of the Interpretation Act, if I could go to the Interpretation Act for just a moment.  One sees in the Interpretation Act the terms of section 31(2) which says that:

An appendix . . . in a written law . . . forms part of the written law.

I took your Honours on Tuesday I think to the cognate provisions of the Interpretation Act which deal with the definition of “Act” and “law” and so on.  If one goes to the opening part of it, referred to I think by Justice Keane ‑ if one goes to the opening part of that Act one sees in section 3 the provision dealing with application.  The potentially relevant provision of that one would look at would be section 3(1)(b) which says that:

The provisions of this Act apply to every written law . . . unless in relation to a particular written law —

. . . 

(b)in the case of an Act, the intent and object of the Act or something in the subject or context of the Act is inconsistent with such application –

Now, your Honours, indeed it is difficult to see how there could be such inconsistency in circumstances where the 2002 Act specifically preserves the operation of the Government Agreements Act.  Could I, with respect, your Honours, add two further observations in that regard.  One is a general matter, namely that the view that repetition in legislation of a provision dealt with by the courts means that a judicial interpretation has been legislatively approved, has not been entirely warmly received in this Court.

May I give your Honours a reference.  I will not take your Honours to it at the moment, but could I give to your Honours what was said by Justices Toohey, McHugh and Gummow in Zickar v MGH Plastic Industries Pty Ltd 187 CLR 310 at 329 referring to an earlier observation I think by Justice Dixon. But your Honours, what is said in relation to it is that occasionally it will be possible for an inference of that kind to be drawn but it is not really a principle of the most general application. I invite your Honours to give consideration to that aspect of it. The second observation, your Honours, is that the suggestion that is made that there is a course of decision against us which should be followed is, in our submission, not correct.

Now, the decisions that are relied on are decisions below this Court in the judicial hierarchy and, in our submission, to the extent to which there is, say, a non‑application of section 3(b) and the other provisions, they appear, in our submission, erroneous. They simply do not give effect to the words of the statutes they are applying. There is no reason, in our submission, why this Court, a level above those courts, should not give the words of the statutes their correct meaning. That is, after all, if I may say so, what this Court is for. Your Honours, I see the time. I am not sure how long I will be, probably an hour tomorrow.

KIEFEL CJ:   Yes, thank you, Mr Jackson.  The Court will adjourn until 9.45 am tomorrow.

AT 4.14 PM THE MATTER WAS ADJOURNED
UNTIL FRIDAY, 18 JUNE 2021