Mobil Oil Australia Pty Ltd v Victoria

[2002] HCA 27

HIGH COURT OF AUSTRALIA

GLEESON CJ,
GAUDRON, GUMMOW, KIRBY, HAYNE AND CALLINAN JJ

MOBIL OIL AUSTRALIA PTY LTD  PLAINTIFF

AND

THE STATE OF VICTORIA & ANOR  DEFENDANTS

Mobil Oil Australia Pty Ltd v Victoria [2002] HCA 27

26 June 2002
M141/2000

ORDER

Each of the demurrers to the amended statement of claim is allowed with costs.

Representation:

D F Jackson QC with G R Kennett for the plaintiff (instructed by Blake Dawson Waldron)

D Graham QC, Solicitor-General for the State of Victoria with C M Kenny for the first defendant (instructed by Victorian Government Solicitor)

J B R Beach QC with B F Quinn and L M Nichols for the second defendant (instructed by Slater & Gordon)

Interveners:

D M J Bennett QC, Solicitor-General of the Commonwealth with K L Eastman and G A Hill intervening on behalf of the Attorney-General of the Commonwealth (instructed by Australian Government Solicitor)

B M Selway QC, Solicitor-General for the State of South Australia with P S Psaltis intervening on behalf of the Attorney-General for the State of South Australia (instructed by Crown Solicitor for the State of South Australia)

M G Sexton SC, Solicitor-General for the State of New South Wales with M J Leeming intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for the State of New South Wales)

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

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

CATCHWORDS

Mobil Oil Australia Pty Ltd v Victoria

Practice and procedure – Group proceedings – Defendant to group proceeding manufactured defective aviation fuel – Group proceeding commenced against manufacturer alleging breach of contract and negligence – Proceeding arose out of the same or similar circumstances and gave rise to a substantial common question of law or fact – Originating process served on manufacturer within the jurisdiction.

Constitutional law – State – Legislative powers of State parliament – Whether statute providing for group proceedings to bind unaware claimants in other States beyond the legislative power of a State parliament – Whether statute offends the territorial limitations of a State parliament.

Constitutional law – Federal – Whether State group proceedings involve the impermissible exercise of the judicial power of the Commonwealth – Whether judgment given in a group proceeding gives rise to a "judgment, decree, order or sentence" within the meaning of s 73 of the Constitution – Whether group proceedings otherwise incompatible with Ch III of the Constitution.

Constitution, s 73.
Constitution Act 1975 (Vic), ss 16, 75.
Courts and Tribunals Legislation (Miscellaneous Amendments) Act 2000 (Vic), s 13.
Supreme Court Act 1986 (Vic), Pt 4A.

1. GLEESON CJ. Demurrers by each of two defendants to an Amended Statement of Claim were set down for hearing before a Full Court. The plaintiff, Mobil Oil Australia Pty Ltd ("Mobil"), commenced an action in this Court seeking a declaration that the provisions of Pt 4A of the Supreme Court Act 1986 (Vic), which were inserted by the Courts and Tribunals Legislation(Miscellaneous Amendments) Act 2000 (Vic), are beyond the legislative power of the Parliament of Victoria and are invalid. Two grounds of invalidity were advanced. They were that the provisions:

   (a)exceed the territorial limits on the legislative power of the State arising under the Constitution or otherwise; and

   (b)are inconsistent with the requirements for the exercise of judicial power by the Supreme Court arising under the Constitution.

2. The essential ground of each demurrer is that Pt 4A is within the legislative power of the Victorian Parliament and is valid. 

3. Part 4A provides for the commencement and conduct of group proceedings.  Mobil, a company incorporated in Victoria, is the defendant in group proceedings commenced in the Supreme Court of Victoria by Schutt Flying Academy (Australia) Pty Ltd ("Schutt").  The second defendant in the action in this Court was later substituted for Schutt as plaintiff in the group proceedings.  The group proceedings arose out of the manufacture in Victoria, by Mobil, of allegedly contaminated aviation fuel, and the subsequent supply of that product to consumers of aviation fuel in Victoria and in other Australian States and Territories.  The case is based on allegations of breach of contract and negligence.  The contracts of supply were made in various States, and reliance is placed upon terms implied by the Sale of Goods Acts of a number of States.  The plaintiff in the group proceedings sues as representative of all the persons to whom contaminated aviation fuel was supplied.

4. The provisions of Pt 4A are substantially the same as those previously found in O 18A of the Supreme Court (General Civil Procedure) Rules 1996 (Vic), which had been subject to unsuccessful challenge in Schutt Flying Academy (Australia) Pty Ltd v Mobil Oil Australia Ltd[1].  They are also generally along the lines of Pt IVA of the Federal Court of Australia Act 1976 (Cth), which was considered by this Court in Wong v Silkfield Pty Ltd[2].

   [1](2000) 1 VR 545.

   [2](1999) 199 CLR 255.

5. The features of Pt 4A to which Mobil directs particular attention may be summarised as follows: 

   1.A person does not need to give his or her consent in order to be a group member.

   2.It is not necessary for the originating process to have, or specify the number of, group members.  Part 4A envisages group proceedings being conducted in which not all members of the group have been identified, and even proceedings in which the number of group members is not known.

   3.Section 33ZE suspends the limitation period in relation to each claim of a group member to which the group proceeding relates. Time begins to run again if the group member "opts out" or if the group proceeding is determined without disposing of that claim.

   4.A group member may "opt out" of a group proceeding.

   5.Under s 33KA(1) the Court has a discretion to order that a person cease to be a group member, or not become a group member. That discretion arises when the Court is of the opinion that either the person does not have a sufficient connection with Australia to justify inclusion as a group member or for any other reason it is just and expedient that the person not be or become a group member. This confirms that connection with Victoria is not a test for inclusion in the group and that the location of persons outside Victoria, or even outside Australia, is not necessarily a barrier to their inclusion.

   6.The Court also has a discretionary power to order that a proceeding no longer continue as a group proceeding under Pt 4A.

   7.The Court is given power to deal with a situation in which resolution of the common issues will not determine all claims, including by establishing sub-groups, giving directions for the determination of remaining questions, allowing an individual group member to participate, and giving directions for the commencement of further proceedings.

   8.The Court has power to substitute another group member for the plaintiff if it appears that the plaintiff is not able adequately to represent the interests of the group members.  This is not a mechanism for the plaintiff to be replaced on the application of group members who disagree with the way the case is being run.

   9.The judgment in a group proceeding may determine questions of law and fact, make a declaration of liability, and grant equitable relief, damages or other monetary relief.  Damages may be awarded as specific amounts to individuals or in an aggregate amount.

   10.The judgment must identify the group members who will be affected by it, and binds all persons who are such group members at the time the judgment is given.

6. In order to put the matter into perspective, it is necessary to bear in mind that there is no novelty in the conferring of jurisdiction to hear and determine actions or suits in which a plaintiff or a defendant is appointed to represent others who are not parties to the proceedings.  The history of representative actions, and the considerations of justice and convenience which they serve, were matters examined by this Court in Carnie v Esanda Finance Corporation Ltd[3].  The purpose of more modern provisions, of the kind found in Pt IVA of the Federal Court of Australia Act, was explained in Wong v Silkfield Pty Ltd[4].  Subject to the capacity of the court managing representative proceedings to control the proceedings in such a manner as to ensure fairness, a capacity usually conferred by wide discretionary powers in relation to the conduct of the action, persons represented in such proceedings were not necessarily residents of the local territory in which the proceedings were taken; and they were not even necessarily aware of the proceedings[5].

   [3](1995) 182 CLR 398 at 415-417 per Toohey and Gaudron JJ, 427-429 per McHugh J.

   [4](1999) 199 CLR 255.

   [5]As to the practice concerning representative orders in proceedings in Chancery, see Templeton v Leviathan Pty Ltd (1921) 30 CLR 34 at 74-79 per Starke J.

   Extra-territorial reach

7. Mobil contends that Pt 4A represents a constitutionally impermissible attempt to confer upon the Supreme Court of Victoria "a national jurisdiction in group proceedings".  Group members may be persons who are non-residents of Victoria, whose claims against Mobil arise from transactions or events outside Victoria, and who have not chosen Victoria as the forum for resolution of those claims in any sense other than that they have failed to "opt out" of the group proceedings, perhaps without knowing that the proceedings were on foot.  As to group members who are residents of Victoria, Mobil appears to accept that the fact of such residence would empower the Parliament of Victoria to enact provisions of the kind found in Pt 4A if they were confined to Victorian residents, even though such residents may not know of the group proceedings.  But the application of such provisions to group members resident in other States or Territories is said to exceed legislative power.  The position of group members who may reside outside Australia was not explored.

8. There were two strands, different but related, to the argument advanced on behalf of Mobil.  The first concerns territorial limits upon the law-making capacity of State Parliaments.  The second concerns implications from the federal structure of the Australian Constitution.

9. The history, rationale and scope of territorial limitations on the legislative competence of State Parliaments was explained in Union Steamship Co of Australia Pty Ltd v King[6]. What was there described as a "new dispensation" in s 2(1) of the Australia Act 1986 (Cth)[7] was said perhaps to do no more than recognize what had already resulted from judicial decisions.  Typical of such decisions was that of Gibbs J in Pearce v Florenca[8], who pointed out that a power to make laws for the peace, order and good government of a State is not limited to laws which operate or apply only to persons or events within the State.  Such a power requires a relevant territorial connection between the law and the State, but the test of relevance is to be applied liberally, and even a remote or general connection will suffice.

   [6](1988) 166 CLR 1.

   [7]See also Australia Act 1986 (UK), s 2(1).

   [8](1976) 135 CLR 507 at 517-518.

10. The Constitution Act 1975 (Vic), in s 16, provides that the Parliament of Victoria "shall have power to make laws in and for Victoria in all cases whatsoever". That power, although differently expressed, is not different in substance from the corresponding powers conferred upon other State legislatures. The Australia Act 1986 (Cth), in s 2(1), provides that each State has "full power to make laws for the peace, order and good government of that State that have extra-territorial operation". The territorial connection between Pt 4A and Victoria is neither remote nor general. It is direct and specific. It concerns the jurisdiction of the Supreme Court of Victoria. It only operates in relation to claims in respect of which the Supreme Court otherwise has jurisdiction. By s 85(1) of the Constitution Act 1975 (Vic) the Supreme Court "shall have jurisdiction in or in relation to Victoria its dependencies and the areas adjacent thereto in all cases whatsoever and shall be the superior Court of Victoria with unlimited jurisdiction". Historically, the primary basis of the Court's jurisdiction in an action in personam was service of originating process on a defendant within the jurisdiction (such as Mobil).  The Service and Execution of Process Act 1992 (Cth) extended the area within which service on a defendant may be effected, and there are rules of court relating to substituted service and service outside the jurisdiction.  Subject to immaterial exceptions, the rules relating to the amenability of a defendant to the jurisdiction of the Supreme Court in group proceedings are the same as those applicable in any other proceedings, including proceedings commenced as representative actions under the old rules.  No one could fairly describe the jurisdiction involved in the present case, where product liability claims are brought against a company incorporated in Victoria, in respect of goods manufactured in Victoria, as long-arm jurisdiction.  But, in any event, Pt 4A takes the jurisdiction of the Supreme Court of Victoria, in terms of the amenability to process of a defendant, as it finds it.

11. The focus of attention in the argument of Mobil is not the defendant, but the group members.  That inverts the usual principle as to the jurisdiction of a court, which is the capacity to exercise power over a defendant.  In Laurie v Carroll[9], Dixon CJ, Williams and Webb JJ quoted the statement of Viscount Haldane[10] that "[t]he root principle of the English law about jurisdiction is that the judges stand in the place of the Sovereign in whose name they administer justice, and that therefore whoever is served with the King's writ, and can be compelled consequently to submit to the decree made, is a person over whom the Courts have jurisdiction".

    [9](1958) 98 CLR 310 at 323.

    [10]John Russell & Co Ltd v Cayzer, Irvine & Co Ltd [1916] 2 AC 298 at 302.

12. The legislative policy underlying group proceedings may be open to legitimate difference of opinion, but the primary object is clear enough.  It is to avoid multiplicity of actions, and to provide a means by which, where there are many people who have claims against a defendant, those claims may be dealt with, consistently with the requirements of fairness and individual justice, together.  The discretionary powers conferred upon the Court in dealing with a group proceeding are consistent with that objective.  To point to the theoretical possibility that in a particular case those powers might not be exercised wisely, or might operate unfairly, is not to deny the existence of the legislative power to establish such a regime.  Possible abuse of legislative power is not a reason for denying the existence of the power[11].  And possible misuse of the discretionary powers built into the scheme of Pt 4A does not negate the plain territorial connection between that scheme and Victoria.  The litigation against Mobil illustrates the nature of the interests of Victoria in legislating for group proceedings.  The Supreme Court of Victoria is a natural forum for claims against Mobil arising out of the manufacture in Victoria of contaminated aviation fuel, even though some of the fuel was supplied in other States and Territories.  If every person who suffered harm as a result of buying or using such fuel were to bring a separate action in the Supreme Court, then in each such action there would be litigation, and re-litigation, of common issues of fact and law.  The State has an interest in preventing this, so far as that can be done consistently with the requirements of justice to all parties.  The procedures of the Federal Court of Australia provided a precedent for an acceptable solution.  To complain that what is involved is an attempt to confer on the Supreme Court of Victoria a "national jurisdiction" is merely to say that its existing jurisdiction has been adapted to permit group proceedings of the kind available in the Federal Court.  That is hardly a disturbing prospect, especially when regard is had to the expansion of jurisdiction that had previously occurred by reason of the Service and Execution of Process Act, and the cross-vesting legislation in its operation between State and Territory courts.

    [11]Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 151.

13. The second strand of Mobil's argument invokes an established, although somewhat vague and ill-defined, qualification to the general principle concerning the extra-territorial legislative competence of State Parliaments. That principle is subject to the Constitution, and "cannot affect territorial limitations of State legislative powers inter se which are expressed or implied in the Constitution"[12]. It is argued that there is a territorial limitation of State legislative powers implied from the federal structure of the Constitution. So much was expressly acknowledged by Brennan CJ, Dawson, Toohey and Gaudron JJ in State Authorities Superannuation Board v Commissioner of State Taxation (WA)[13].

    [12]Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1 at 14.

    [13](1996) 189 CLR 253 at 271.

14. In Melbourne Corporation v The Commonwealth[14], Dixon J said:

    "The foundation of the Constitution is the conception of a central government and a number of State governments separately organized. The Constitution predicates their continued existence as independent entities. Among them it distributes powers of governing the country. The framers of the Constitution do not appear to have considered that power itself forms part of the conception of a government. They appear rather to have conceived the States as bodies politic whose existence and nature are independent of the powers allocated to them. The Constitution on this footing proceeds to distribute the power between State and Commonwealth and to provide for their inter-relation, tasks performed with reference to the legislative powers chiefly by ss 51, 52, 107, 108 and 109."

    [14](1947) 74 CLR 31 at 82.

15. Legislative, executive, and judicial powers are exercised by different governmental authorities in different localities, or in respect of different purposes in the same locality[15]. State legislative, executive and judicial power is territorially based; in the case of legislative power, the requirement of territorial connection is applied in accordance with the principle earlier discussed. The necessary implications which are involved in the federal structure of the Australian Constitution are influenced by the kind of federal structure we have. The Constitution gives the federal Parliament enumerated powers, some of them exclusive, and s 109 operates in the event of inconsistency between federal and State laws. There is no corresponding provision to deal with the possibility of inconsistency between State laws, but there are choice of law principles which come into play when rights and liabilities are potentially affected by different State laws[16].  Commonwealth legislative power, in its application to the States, is qualified by the principle that prohibits both the imposition on the States of special burdens and disabilities and the enactment of laws of general application which operate to destroy or curtail the continued existence of the States or their capacity to function as governments[17].  That principle is founded upon an implication which also has significance in relation to an exercise of State legislative power which destroys or weakens the legislative authority of another State or its capacity to function as a government[18].

    [15]Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129 at 152.

    [16]JohnPfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503.

    [17]Melbourne Corporation v The Commonwealth (1947) 74 CLR 31; Queensland Electricity Commission v The Commonwealth (1985) 159 CLR 192 at 217 per Mason J.

    [18]cf Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410 at 451 per McHugh J.

1. Mobil submits that an implication from federalism prohibits State legislation which, if given extra-territorial effect, would affect the relationship between another State or a Territory and its residents or would determine the legal consequences of actions in another State or Territory.  That proposition is far too broad.  There is nothing either uncommon, or antithetical to the federal structure, about legislation of one State that has legal consequences for persons or conduct in another State or Territory.  An example is to be found in the provisions of the Clean Waters Act 1970 (NSW) considered in Brownlie v State Pollution Control Commission[19].  That legislation was held to apply to acts or omissions (in that case, trans-border pollution) outside New South Wales which had, or were likely to have, consequences within New South Wales.  The idea that all transactions and relationships giving rise to legal consequences can be located "in" one particular State or Territory is unrealistic.  Furthermore, the concept of the relationship between a State and its residents requires a much narrower focus if it is to be of assistance in the resolution of a problem such as arises in the present case.  For the claim of a resident of New South Wales against a Victorian company which has manufactured, in Victoria, a defective product that was later supplied in New South Wales to be brought into representative proceedings in a Victorian court does not impinge on the relationship between the New South Wales resident and the New South Wales Government.  Different considerations might arise, for example, if the New South Wales Parliament, adopting a policy hostile to group proceedings, or class actions, set out to prevent residents of New South Wales from participating in litigation of that kind.  But no such problem arises here.

   [19](1992) 27 NSWLR 78.

2. Legislation and rules of court in Australian States and Territories, as well as in federal jurisdiction, have for a long time made provision for service outside the jurisdiction, joinder of parties, consolidation of actions, and a variety of procedural devices aimed at avoiding multiplicity of actions and unnecessary and expensive inefficiency in resolving legal disputes.  Typically, they are accompanied by procedural safeguards which vest in courts discretionary powers aimed at ensuring that attempts to promote efficiency in the administration of justice do not result in injustice to individuals.  Part 4A includes safeguards of that kind.  Such a scheme is not incompatible with federalism.  It helps to make it work.

3. The first ground of challenge to the validity of the legislation has not been made out.

   Judicial power

4. Mobil's second ground of challenge is based upon s 73 of the Constitution, which defines the appellate jurisdiction of this Court. That jurisdiction includes jurisdiction to hear and determine appeals from all judgments, decrees, orders and sentences of the Supreme Court of any State. The contention involves two steps: first, that s 73 requires that State Supreme Courts determine controversies only in accordance with the proper exercise of judicial power; secondly, that there are aspects of Pt 4A that are repugnant to the exercise of judicial power. The argument fails at both steps.

5. Section 73 of the Constitution does not require that every exercise of judicial power by a State Supreme Court be a "judgment, decree, order or sentence" of a kind referred to in s 73, or that all decisions of State Supreme Courts be appealable to this Court. State courts may exercise non-judicial power[20].

   [20]Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51 at 80 per Dawson J, 109-110 per McHugh J, 142 per Gummow J.

6. The provisions of Pt 4A are not repugnant to the exercise of judicial power.  Reference has earlier been made to the long history of representative proceedings, and to the supervisory powers in relation to such proceedings that have always existed.  In Carnie v Esanda Finance Corporation Ltd[21], Brennan J pointed out that it was "precisely because of the flexible utility of the representative action that judicial control of its conduct is important, to ensure not only that the litigation as between the plaintiff and defendant is efficiently disposed of but also that the interests of those who are absent but represented are not prejudiced by the conduct of the litigation on their behalf".

   [21](1995) 182 CLR 398 at 408.

7. Certain of Mobil's objections to Pt 4A proceedings would apply with equal, and perhaps even greater, force to representative proceedings of a more traditional kind.  Limitation on the ability of group members to control the manner in which the proceedings are conducted, and potential lack of involvement in or even awareness of proceedings, were features of the procedural rules considered in Carnie, and the provisions of Pt 4A contain much stronger protections against the possibility of resulting unfairness than were available under those rules.  Indeed, the capacity for members to opt out is a considerable advance upon rules of court of the kind considered by Fletcher Moulton LJ in Markt & Co Ltd v Knight Steamship Co Ltd[22].  It is not unknown for judicial decisions to determine the rights of people who were unaware of their existence, or even of people who were unborn at the time of the decision[23].

   [22][1910] 2 KB 1021 at 1039.

   [23]cf In re Freme's Contract [1895] 2 Ch 778 at 780-781.

8. A particular objection was raised concerning the provisions of s 33Z and the assessment of damages. But there is nothing in s 33Z that requires damages to be assessed otherwise than in accordance with recognized legal principles[24].

   [24]Schutt Flying Academy (Australia) Pty Ltd v Mobil Oil Australia Ltd (2000) 1 VR 545 at 558-560 [35]-[37] per Ormiston JA.

9. The second ground of challenge to the validity of the legislation also fails.

   Conclusion

10. Each demurrer should be allowed with costs.

11. GAUDRON, GUMMOW AND HAYNE JJ. Section 13 of the Courts and Tribunals Legislation (Miscellaneous Amendments) Act 2000 (Vic) ("the Courts Legislation Amendment Act") amended the Supreme Court Act 1986 (Vic) by inserting, as Pt 4A of the latter Act, provisions governing "group proceedings" in the Supreme Court of Victoria. Mobil Oil Australia Pty Ltd ("Mobil"), the plaintiff in this Court, alleges that the enactment of s 13 of the Courts Legislation Amendment Act was beyond the legislative power of the Parliament of Victoria and invalid. For the reasons that follow, that contention should be rejected.

    The proceedings in the Supreme Court and in this Court

12. In January 2000, Schutt Flying Academy (Australia) Pty Ltd ("Schutt") commenced a proceeding in the Supreme Court of Victoria as plaintiff against Mobil as defendant. Mobil is incorporated in Victoria and argument of the matter in this Court proceeded on the basis that the writ in the Supreme Court proceeding had been served on Mobil in Victoria. Schutt's action against Mobil was brought as a group proceeding under O 18A of the Supreme Court (General Civil Procedure) Rules 1996 ("the 1996 Victorian Rules"), it being alleged that seven or more persons had claims against Mobil which were claims arising out of the same or similar circumstances and giving rise to a substantial common question of law or fact. Schutt alleged breach of contract and negligence by Mobil in connection with aviation fuel manufactured by it (in Victoria) and supplied to numerous persons at various places in Victoria, New South Wales, Queensland, the Australian Capital Territory and other, unspecified, places in Australia. Schutt commenced the proceeding as representing all of those persons.

13. Mobil challenged the validity of O 18A of the 1996 Victorian Rules.  In June 2000, the Court of Appeal of Victoria, by majority (Ormiston, Phillips and Charles JJA, Winneke P and Brooking JA dissenting), held[25] that the Rules were valid.  Mobil filed an application for special leave to appeal to this Court from the orders of the Court of Appeal.  Its application for special leave was discontinued.

    [25]Schutt Flying Academy (Australia) Pty Ltd v Mobil Oil Australia Ltd (2000) 1 VR 545.

14. After the application for special leave had been filed, the Courts Legislation Amendment Act was passed. The amendments inserting Pt 4A in the Supreme Court Act were deemed to have commenced on 1 January 2000[26]. It follows that if the relevant provisions of the Courts Legislation Amendment Act are valid, the commencement and further conduct of the proceeding brought in the Supreme Court by Schutt would be regulated by Pt 4A.

    [26]Courts and Tribunals Legislation (Miscellaneous Amendments) Act 2000 (Vic), s 2(2).

15. In December 2000, an order was made in the Supreme Court that Schutt cease to be the plaintiff in the proceeding in that Court, and that Tasfast Air Freight Pty Ltd ("Tasfast") be substituted as plaintiff. Soon after that order was made, Mobil began the present action in the original jurisdiction of this Court seeking a declaration that s 13 of the Courts Legislation Amendment Act was beyond the legislative power of the Parliament of Victoria and invalid or, alternatively, a declaration that one particular provision of Pt 4A, as introduced by that amending Act (s 33ZK), was beyond power and invalid. The State of Victoria, the first defendant to the proceeding in this Court, and Tasfast, the second defendant, each demurred to Mobil's statement of claim on the ground that the impugned provisions are within the legislative power of the Victorian Parliament. Those demurrers were set down for hearing by a Full Court.

16. At the hearing of the demurrers, Mobil, by leave, amended its statement of claim by deleting the particular allegations made in respect of s 33ZK and the alternative claim for relief confined to that provision.  Demurrers to the amended pleading should be allowed.

    Former provisions for joinder of plaintiffs and for representative proceedings

17. Rules of court drawn on the pattern of the English rules of 1883[27] have long provided for the joinder as plaintiffs in one action of all persons "in whom any right to relief in respect of or arising out of the same transaction or series of transactions is alleged to exist"[28].  The relevant rule was interpreted as allowing the joinder of plaintiffs in one action where two conditions were satisfied:  (i) that the right of relief arose in each case out of the same transaction or series of transactions, and (ii) that some common question of law or fact arose[29].  It permitted several plaintiffs to bring a single action against a defendant for the determination of the individual claims of the plaintiffs.

    [27]Rules of the Supreme Court 1883 (Eng) ("the 1883 English Rules").

    [28]See, for example, Rules of Procedure in Civil Proceedings 1957 (Vic), O 16 r 1 ("the 1957 Victorian Rules"); the 1883 English Rules (as amended in 1896), O 16 r 1; cf High Court Rules, O 16 r 1(1)(a).

    [29]See, for example, Stroud v Lawson [1898] 2 QB 44 at 52 per Chitty LJ; Universities of Oxford and Cambridge v George Gill & Sons [1899] 1 Ch 55 at 59 per Stirling J.

18. Further, rules of court drawn on the 1883 English pattern made provision for representative proceedings modelled on the former Chancery practice[30].  That former Chancery practice "required the presence of all parties interested in the matter in suit, in order that a final end might be made of the controversy"[31] and was a rule of convenience[32].  A common example of its use was by one or more creditors of a deceased person seeking an account of the deceased's estate, ascertainment of the deceased's debts and an order for their payment[33], and its use extended to cases in which members of the class on whose behalf the suit was brought were "perfectly ignorant of the proceedings, and of what is really going on"[34].  The Chancery practice and the rules governing representative proceedings permitted the bringing of a single action that would decide the rights and duties of all who fell within the class of persons represented by the representative plaintiff.

    [30]The 1957 Victorian Rules, O 16 r 9; the 1883 English Rules, O 16 r 9.

    [31]Duke of Bedford v Ellis [1901] AC 1 at 8 per Lord Macnaghten.

    [32]Harvey v Harvey (1841) 4 Beav 215 [49 ER 321], (1842) 5 Beav 134 [49 ER 528]; Hawkins v Hawkins (1842) 1 Hare 543 [66 ER 1147]; Smart v Bradstock (1844) 7 Beav 500 [49 ER 1159].

    [33]Mitford, A Treatise on the Pleadings in Suits in the Court of Chancery by English Bill, 4th ed (1827) at 166‑167; Leigh v Thomas (1751) 2 Ves Sen 312 [28 ER 201].

    [34]Powell v Wright (1844) 7 Beav 444 at 446‑447 per Lord Langdale MR [49 ER 1137 at 1138].

19. The rules permitting joinder of plaintiffs in one action and the rules providing for representative actions of the kind for which rules on the pattern of the 1883 English Rules had provided came, so it would seem, to be seen as not flexible enough to accommodate all cases in which it would be convenient for there to be only one action to determine all the claims that were or could be made by a large number of persons against a defendant.  It is not necessary to pause to consider the validity of the assumption that these earlier forms of procedure were inadequate.  Provision has now been made in more than one Australian jurisdiction for "class" or "group" actions[35].  By this kind of action the claims that are made, or could be made, against the defendant by all those in the "class" or "group" that is identified in the proceeding would be decided.  The provisions introduced into the Supreme Court Act by s 13 of the Courts Legislation Amendment Act provided for this kind of action.

    [35]For example, Federal Court of Australia Act 1976 (Cth), Pt IVA.

    Part 4A of the Supreme Court Act

20. Consideration of the validity of the amendment which introduced the provisions of Pt 4A of the Supreme Court Act must begin by examining the provisions that were introduced.  Of those provisions, s 33C, which identifies when a group proceeding may be instituted, is central.  That section provides that if seven or more persons have claims against the same person, those claims are "in respect of, or arise out of, the same, similar or related circumstances" and the claims of all of those persons "give rise to a substantial common question of law or fact … a proceeding may be commenced by one or more of those persons as representing some or all of them".

21. A group proceeding may be commenced whether or not the relief claimed is or includes equitable relief[36], consists of or includes damages[37], includes claims for damages that would require individual assessment[38] or is the same for each person represented[39].  Such a proceeding may be commenced whether or not the proceeding concerns separate contracts or transactions between the defendant and individual group members[40] or involves separate acts or omissions of the defendant done, or omitted to be done, in relation to individual group members[41].

    [36]s 33C(2)(a)(i).

    [37]s 33C(2)(a)(ii).

    [38]s 33C(2)(a)(iii).

    [39]s 33C(2)(a)(iv).

    [40]s 33C(2)(b)(i).

    [41]s 33C(2)(b)(ii).

22. The persons who commence the proceeding are the plaintiffs.  (In the Supreme Court proceeding out of which the matter in this Court arises, there has always been only the one plaintiff – first, Schutt and now Tasfast.)  Obviously, those who are named as plaintiffs in a group proceeding must know of and require the commencement of the proceeding.  In general, it is they who may appeal[42] and who are liable in costs[43].  They stand to gain from any benefit obtained by the proceeding but they are at risk of bearing the burden of costs.

    [42]s 33ZC.

    [43]s 33ZD.

23. The position of the plaintiffs in the proceeding may be contrasted with those whom they represent – the group members.  Subject to some exceptions that do not matter for present purposes, the consent of a person to be a group member is not required[44].  Group members may neither know of the commencement of the proceeding nor wish that it be brought or prosecuted, although Pt 4A does provide for notice to be given to group members of (among other things) the commencement of the proceeding[45].

    [44]s 33E.

    [45]s 33X(1).

24. The Supreme Court may dispense with the giving of that notice if the relief sought in the proceeding does not include a claim for damages[46] and, if notice is to be given, it may be given by press advertisement, radio or television broadcast or any other means[47].  Unless the Supreme Court is satisfied that it is reasonably practicable, and not unduly expensive, to do so the Court may not order that notice of the proceeding is to be given personally to group members[48].  There is, therefore, a real possibility that some group members would remain "perfectly ignorant of the proceedings, and of what is really going on"[49].  That is, some of those who would benefit from success in the proceeding (but thereby lose the opportunity to pursue their individual claim in some way, or to some effect, different from the group proceeding) may have their rights affected without their knowing or consenting to that being done.

    [46]s 33X(2).

    [47]s 33Y(3).

    [48]s 33Y(4).

    [49]Powell v Wright (1844) 7 Beav 444 at 446-447 per Lord Langdale MR [49 ER 1137 at 1138].

25. So much follows from the fact that Pt 4A provides for what is sometimes called an "opt out", rather than an "opt in", procedure.  That is, persons who are group members may opt out of the proceeding and, if they do, they are taken never to have been a group member (unless the Court otherwise orders)[50].  Group members, however, need take no positive step in the prosecution of the proceeding to judgment to gain whatever benefit its prosecution may bring.

    [50]s 33J(5).

26. Provision is made for the Court to fix a date before which a group member may opt out[51] and, except with the leave of the Court, trial of the proceeding may not begin before that date[52].  The Court, on the application of a party to the proceeding, or of its own motion, may at any time, before or after judgment, order that a person cease to be, or not become, a group member[53].  The circumstances in which the Court may make such an order are stated in very wide terms.  It may do so if it is of the opinion that the person does not have "sufficient connection with Australia to justify inclusion as a group member", or that for any other reason it is "just or expedient" that the person should not be or become a group member[54].  And if a person who is a group member does not opt out, either before or after judgment, a judgment given in the proceeding binds that person along with all other persons who are group members at the time judgment is given[55].

    [51]s 33J(1).

    [52]s 33J(4).

    [53]s 33KA(1).

    [54]s 33KA(2).

    [55]s 33ZB.

27. The persons bound by the judgment may, or may not, have some connection with the State of Victoria.  The claims which such persons had against the defendant, if considered separately from the claims of the plaintiffs in the proceeding, or the claims of other group members, may or may not have some connection with the State.  This follows from the circumstances in which a group proceeding may be brought.  It may be brought when the claims dealt with by it arise out of similar circumstances and those claims give rise to a substantial common question of law or fact[56], conditions which are much less restrictive than requiring that the circumstances from which the claims arise, or the questions of law or fact that are raised, be identical.  The claims of some claimants may, therefore, arise out of transactions and events occurring wholly outside Victoria, and the claimants may have no connection with the State.

    [56]Wong v Silkfield Pty Ltd (1999) 199 CLR 255 at 266‑267 [27] per Gleeson CJ, McHugh, Gummow, Kirby and Callinan JJ.

1. Nonetheless, it may be noted that all group members in the group proceeding which gives rise to this matter were alleged to have claims in negligence against Mobil arising out of the negligent manufacture, in Victoria, of the fuel which it was alleged was defective.  Moreover, it should also be noted that Mobil was not only served with the relevant process in Victoria, it is a company incorporated in that State.  Thus, all of the claims with which this group proceeding seeks to deal are claims having at least these links (the place of commission of the alleged breach of duty and the defendant's place of incorporation) with Victoria.

   Mobil's contentions

2. Mobil's contention that s 13 of the Courts Legislation Amendment Act was beyond the power of the Parliament of Victoria and invalid rested upon two propositions, one about territorial limitation of the powers of the Victorian Parliament and the second about the effect to be given to s 73 of the Constitution.

   Extraterritoriality

3. The Constitution Act 1975 (Vic) provides[57] that the Parliament of Victoria "shall have power to make laws in and for Victoria in all cases whatsoever".  It further provides that[58]:  "A Court shall be held in and for Victoria and its dependencies which shall be styled 'The Supreme Court of the State of Victoria' …".

   [57]s 16.

   [58]s 75.

4. Other State Constitutions use expressions other than "in and for" the State in describing the power of the State legislature.  "[F]or the peace, welfare, and good government" of the State[59], or "for the peace, order, and good Government"[60] of the State are expressions in some State Constitutions.  But just as a power to make laws for the peace, welfare, and good government (or peace, order, and good government) of a State is a plenary power[61] so, too, is the power of the Victorian Parliament to make laws "in and for Victoria".  Neither the words "peace, welfare [or order], and good government" nor the words "in and for" the State are to be read as words of limitation[62]. Nor is there any reason to give the words "in and for Victoria" some narrower meaning when used in s 75 of the Constitution Act 1975 in relation to the Supreme Court.

   [59]For example, Constitution Act 1902 (NSW), s 5.

   [60]For example, Constitution Act 1889 (WA), s 2.

   [61]Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1 at 9 per Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ; Durham Holdings Pty Ltd v New South Wales (2001) 75 ALJR 501 at 503 [9] per Gaudron, McHugh, Gummow and Hayne JJ; 177 ALR 436 at 439.

   [62]Union Steamship (1988) 166 CLR 1 at 10 per Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ.

5. It has been said, however, that it is in the words "peace, order and good government" or, in this case "in and for Victoria", that some territorial limitation on the power of a State parliament is to be found[63].  Or, perhaps, territorial limitations on the parliaments of the States are to be found by reference to the federal structure of which each State is a part[64].

   [63]R v Foster; Ex parte Eastern and Australian Steamship Co Ltd (1959) 103 CLR 256 at 307. See also Broken Hill South Ltd v Commissioner of Taxation (NSW) (1937) 56 CLR 337 at 375 per Dixon J; Union Steamship (1988) 166 CLR 1 at 12‑13 per Mason CJ, Wilson, Brennan, Deane, Dawson, Toohey and Gaudron JJ; Johnson v Commissioner of Stamp Duties [1956] AC 331; Thompson v Commissioner of Stamp Duties [1969] 1 AC 320 at 335‑336; Australia Act 1986 (Cth), s 2(1).

   [64]State Authorities Superannuation Board v Commissioner of State Taxation (WA) (1996) 189 CLR 253 at 271 per Brennan CJ, Dawson, Toohey and Gaudron JJ. See also Port MacDonnell Professional Fishermen's Assn Inc v South Australia (1989) 168 CLR 340 at 369-373.

6. It is clear that legislation of a State parliament "should be held valid if there is any real connexion – even a remote or general connexion – between the subject matter of the legislation and the State"[65].  This proposition has now twice been adopted in unanimous judgments of the Court[66] and should be regarded as settled.  That is not to say, however, that there may not remain some questions first, about what is meant in a particular case by "real connexion" and, secondly, about the resolution of conflict if two States make inconsistent laws[67].

   [65]Pearce v Florenca (1976) 135 CLR 507 at 518 per Gibbs J.

   [66]Union Steamship (1988) 166 CLR 1 at 14; Port MacDonnell (1989) 168 CLR 340 at 372.

   [67]Port MacDonnell (1989) 168 CLR 340 at 374; State Authorities Superannuation Board (1996) 189 CLR 253 at 285‑286 per McHugh and Gummow JJ.

7. Mobil contended that it was necessary to decide in this case the extent of the territorial limitations on a State parliament and that, so far as relevant to this case, those limitations stemmed from the nature of a federation in which the States must continue to co‑exist.  Central to Mobil's contentions was the proposition that Pt 4A attempted to make the Supreme Court of Victoria "a national court for the conduct of class actions".  It did so, Mobil submitted, because it drew residents of other States and Territories into proceedings in the Supreme Court, as plaintiffs, in circumstances where their claims had no necessary connection with Victoria and they had not invoked the jurisdiction of that Court.  This, so it was said, denied these persons the chance to bring claims in the courts of the State or Territory in which each lived and bound them in the result of proceedings over which they had no control.

8. This is not an accurate representation of the operation of Pt 4A.  The provisions of Pt 4A do not seek to make the Supreme Court of Victoria a national court.  They do not deny anyone the opportunity to institute proceedings in any other court.  A group member is not a plaintiff.  It is right to say that a judgment obtained in the proceeding would bind those who had not opted out but to say that such persons had "no control" over their part in the proceeding falls well short of fully describing the way in which Pt 4A works.

9. Although a proceeding under Pt 4A may affect the rights both of those who know of and support the prosecution of the proceeding and of those who do not know of it, Pt 4A does not compel the unwilling to continue to remain a group member.  The unwilling may seek to opt out.  Further, in affecting the rights of those who know of the proceeding and those who do not, a proceeding under Pt 4A is no different from representative proceedings of a kind common in the State Supreme Courts since federation and in their colonial predecessors.

10. Mobil submitted that Pt 4A was invalid because of the nature of a federation in which the States must continue to co‑exist.  Although not articulated in this way, the contention appeared to be that unless the authority of a State Supreme Court to decide a civil claim were confined in some way, the federal structure would, in some way, be affected.  Mobil contended that a State court's authority should be confined by holding that those whose claims may be determined by the court must voluntarily invoke its jurisdiction or either have some connection with the State or make a claim having some connection.

11. At once it can be seen that Mobil's submission, if accepted, would require a radical departure from the hitherto accepted understanding of the basis upon which State and federal courts exercise authority to decide personal actions.  That authority stems from the amenability of the defendant to the court's process.  As was said in John Pfeiffer Pty Ltd v Rogerson[68]:

    "In by far the majority of cases, the jurisdiction of Australian courts in personal actions depends on the defendant's presence in the territorial jurisdiction at the time of service of the originating process.  In such cases it is not necessary to show any other connection with the jurisdiction."  (emphasis added)

    For the purposes of its challenge to the validity of s 13 of the Courts Legislation Amendment Act, Mobil sought to shift attention from the significance of a defendant's connection with the State at the time of service of the Court's process upon it, to the connection with the State of the claims dealt with by the proceeding or the connection of those whose claims would be determined or affected by it.

    [68](2000) 203 CLR 503 at 517 [14].

12. Mobil accepted that there was no adverse effect on the federal structure if, as so often happens now, a person having no connection with the State seeks to invoke the jurisdiction of a State Supreme Court to determine a claim that arose outside the territorial limits of the State and invokes that jurisdiction by instituting proceedings in the Court against a defendant who is then served with the Court's process within the State.  That is, Mobil accepted that where a plaintiff actively invokes the jurisdiction of a State Supreme Court, service of process on the defendant within the State would satisfy any requirement of territorial nexus for State legislation which permitted the adjudication of such proceedings.

13. Although Mobil emphasised the fact that, in a case of the kind just mentioned, the plaintiff actively sought the adjudication of the Court in which the proceedings were instituted, the constitutional significance of the plaintiff seeking the Court's adjudication was not elucidated.  Why it should be constitutionally significant to shift the focus of attention from the defendant's amenability to process (because of its presence in the State) to the connection of the claim or the claimants with the State was not explained.  The continued co‑existence of the States in the federation does not require that shift to be made.  If the defendant is served within the jurisdiction, any requirement for a territorial nexus of the State legislation which empowers the Court to decide the proceeding is to be found in the defendant's connection to the jurisdiction by its presence at the time of service of process[69].  The sufficiency of that connection is not affected by whether every claim which is to be adjudicated in the proceeding is actively promoted by the person who is entitled to make it.

    [69]Laurie v Carroll (1958) 98 CLR 310; Gosper v Sawyer (1985) 160 CLR 548 at 564-565; John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 517 [13] per Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ.

14. It is because jurisdiction in personal actions may be established by service of process on the defendant while the defendant is within the relevant territorial area that it has been necessary to develop a body of choice of law rules.  The connection, or absence of connection, of either the claimant, or the claimant's claim, with the State is irrelevant to whether the court's authority to decide the claim that is made against a defendant served within the jurisdiction can be exercised, though the presence or absence of such connections may bear, directly or indirectly, upon the choice of law to be applied.  Thus, the determination of the proper law of a contract may require the examination of the factors which connect the transaction, and thus the parties to it, to one rather than another jurisdiction[70].

    [70]Bonython v The Commonwealth (1948) 75 CLR 589 and, in the Privy Council, (1950) 81 CLR 486; [1951] AC 201.

15. The very existence of that body of choice of law rules, by which State and federal courts in Australia decide what law is to be applied to determine the consequences of acts or omissions which occurred in a State or Territory other than that in which proceedings are brought[71], denies the validity of a proposition that State courts must confine their attention to cases in which the subject matter arises within the geographical area in which the court's writ runs if the States are to be able to co‑exist in the federation.  Yet a proposition of this kind appeared to inform much of Mobil's contention about want of territorial nexus.

    [71]For example, John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503.

16. It is also necessary to notice another consequence of the fact that a State court may take jurisdiction in a personal action when its originating process is served on the defendant within the bounds of its territorial jurisdiction.  It inevitably follows from that fact that there can be cases in which similar, even identical, issues can be raised in the courts of two States between the same or related parties.  It is inevitable, therefore, that there can be overlapping, even conflicting, procedures and judgments of the courts concerned.  Those are difficulties that have hitherto been resolved by the application of principles concerning abuse of process or, more recently, by the application of cross‑vesting legislation[72].  They are not, however, difficulties that have so far been, or should now be, understood as stemming from some limitation on, or want of power in, the parliament of one or other of the States to regulate the procedures of its Supreme Court.  Indeed the content, if not the existence, of the whole body of law that has developed about forum non conveniens[73], denies that the question is to be understood as one rooted in some territorial limitation on the powers of State parliaments which would require that either the plaintiff or the plaintiff's claim be connected with the State.  If the question were one of legislative power, it would be entirely irrelevant and wrong to ask whether the defendant seeking a stay of proceedings had demonstrated that the forum chosen by the plaintiff was clearly inappropriate[74].

    [72]For example, Jurisdiction of Courts (Cross‑vesting) Act 1987 (Vic), s 5(2).

    [73]Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538.

    [74]Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197 at 247‑248 per Deane J; Voth (1990) 171 CLR 538 at 564‑565 per Mason CJ, Deane, Dawson and Gaudron JJ.

17. The fact that some of the claims that are to be adjudged in a proceeding are claims by persons who have taken no active step to bring or prosecute the proceeding does not require some different conclusion about the sufficiency of the connection of that proceeding with the State, or the power of the Victorian Parliament to enact the provisions of Pt 4A of the Supreme Court Act.  That connection rests in the fact that the proceeding regulated by the legislation is a proceeding in a personal action in the Supreme Court held "in and for" the State where that Court's authority to decide the matter stems from the amenability of the defendant to its process.

18. In the ordinary case, where service of the proceeding is effected within the State, the territorial nexus between the proceeding and the State is evident.  In some cases of so‑called "long arm jurisdiction"[75] where service is effected outside Australia, unless the defendant voluntarily submits to the jurisdiction, there must be some nexus between the subject matter and the State or between the defendant and the State.  By contrast, where service is effected within Australia, under the Service and Execution of Process Act 1992 (Cth), no nexus must be shown[76].  There may be some questions of construction of that Act in its application to Supreme Court proceedings – especially some of the provisions made by ss 20 and 21 – but it is not necessary to address those questions now.  It may be noted, however, that the defendant to a proceeding in a Supreme Court, served under the Service and Execution of Process Act, may always seek to have it cross‑vested to another State Supreme Court.

    [75]As, for example, under O 7 of the 1996 Victorian Rules.

    [76]Service and Execution of Process Act 1992 (Cth), s 15.

19. These three bases upon which the Supreme Court of Victoria may assume jurisdiction over a defendant in a personal action are untouched by the provisions now made for group proceedings.  It was not suggested that any of those bases for assumption of jurisdiction was infirm.  It follows that a law which regulates the procedure for dealing not only with claims that are made, but also claims that could be made, against a defendant thus amenable to the jurisdiction of the Supreme Court of Victoria is a law "in and for" Victoria.

20. For these reasons Mobil's contentions about want of territorial connection between Pt 4A and Victoria should be rejected.

    Section 73 of the Constitution

21. Section 73 of the Constitution provides for the appellate jurisdiction of this Court. It provides that this Court shall have jurisdiction, with such exceptions and subject to such regulations as the Parliament prescribes, to hear and determine appeals from all judgments, decrees, orders and sentences of, among other courts, the Supreme Court of any State. It further provides that no exception or regulation prescribed by the Parliament shall prevent this Court from hearing any appeal from the Supreme Court of a State "in any matter in which at the establishment of the Commonwealth an appeal lies from such Supreme Court to the Queen in Council". It is well established that "judgments, decrees, orders and sentences" is to be understood as confined to decisions made in the exercise of judicial power[77].  It follows that not every form of "judgment" or "order" for which the governing statute or rules of a State Supreme Court may make provision can be the subject of an appeal to this Court.

    [77]Holmes v Angwin (1906) 4 CLR 297; Consolidated Press Ltd v Australian Journalists' Association (1947) 73 CLR 549; Saffron v The Queen (1953) 88 CLR 523; Mellifont v Attorney‑General (Q) (1991) 173 CLR 289; Director of Public Prosecutions (SA) v B (1998) 194 CLR 566; Wong v The Queen (2001) 76 ALJR 79; 185 ALR 233.

22. Mobil contended that because the judgment which the Supreme Court of Victoria may give under Pt 4A may decide the claims of those group members who do not know of, and do not actively pursue the prosecution of, a group proceeding, it would not be a judgment exercising judicial power.  From this premise it was contended that it followed that it is beyond the powers of the parliament of a State to "treat as judgments" or as "decisions which purport to bind people as judgments of a court" decisions which are incapable of being the subject of an appeal to this Court.

23. Neither the premise nor the predicate should be accepted.  As has been pointed out earlier in these reasons, dealing with representative claims, and doing so by adjudicating the rights of all who are in a class of persons, has long been a feature of the ordinary practice of courts.  The order that results from representative proceedings of the traditional kind, and the order that results from proceedings of the kind for which Pt 4A provides will, absent some order to the contrary, finally bind all those in the class concerned, regardless of their particular state of knowledge of the proceeding.  It is a judgment made in the exercise of judicial power.

24. Further, even if, contrary to the view just expressed, Mobil's premise (that a judgment given in a group proceeding of the kind for which Pt 4A provides does not give rise to a "judgment, decree, order or sentence" within s 73 of the Constitution) were to be accepted, it by no means follows that the Victorian Parliament has no power to pass a law empowering the Supreme Court to hear and determine proceedings in accordance with Pt 4A. So much follows from the cases in this Court, like Holmes v Angwin[78], in which it has been held that an appeal to this Court does not lie from a particular kind of decision of a State Supreme Court or a judge of a State Supreme Court. It has not been held in those cases that the law permitting the making of the decision was invalid. Rather, all that has been held is that s 73 is not engaged. Indeed, to hold that the State law was invalid would amount to concluding that Ch III of the Constitution, or s 73 in particular, requires that State courts can exercise no power other than judicial power, a conclusion that has not been reached, and is not required by the Constitution[79].

    [78](1906) 4 CLR 297.

    [79]R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254; Re Wakim; Ex parte McNally (1999) 198 CLR 511.

1. The argument founded on s 73 of the Constitution should, therefore, be rejected. A separate but related argument founded on Kable v Director of Public Prosecutions (NSW)[80] which may have been raised by Mobil's statement of claim in the form in which it stood before the amendment made at the hearing of the demurrers was not pursued and need not be noticed.

   [80](1996) 189 CLR 51.

   Conclusion and orders

2. Each demurrer to the amended statement of claim should be allowed with costs.

3. KIRBY J.   The decision of this Court in Re Wakim; Ex parte McNally[81] contradicts the proposition that the conferral by statute of jurisdiction and power on a superior court is immune from the restrictions of the Constitution. Any deployment of public power in Australia must conform to the Constitution. This applies to a purported conferral of jurisdiction and power upon a State court as well as on a federal court, as considered in Wakim.

   [81](1999) 198 CLR 511.

4. It will not be a sufficient answer to a challenge to the constitutionality of a State law that the purported repository of power is a court which can be assumed to exercise the jurisdiction conferred upon it properly and in accordance with rules laid down by, or under, a statute or in accordance with the rules of the common law or equity. Where a challenge is made, there is no alternative but to measure the impugned law against the Constitution and its express provisions and implications that divide lawmaking power in Australia. In a federal nation, a State's legislative power must necessarily adapt to, and be consistent with, the legislative powers of the other States, as well as of the Commonwealth.

   The facts and the proceedings

5. Pursuant to the Constitution[82], Mobil Oil Australia Pty Ltd ("Mobil") has commenced proceedings in this Court. It seeks declaratory relief that s 13 of the Courts and Tribunals Legislation (Miscellaneous Amendments) Act 2000 (Vic) ("the amending Act") is beyond the legislative power of the Parliament of Victoria and therefore invalid. That section inserted Pt 4A into the Supreme Court Act 1986 (Vic) ("the Act"). That Part provides for the commencement and conduct of "group proceedings" in the Supreme Court of Victoria ("the Supreme Court").

   [82]Constitution, s 76(i).

6. Prior to the commencement of the amending Act, a predecessor to Tasfast Air Freight Pty Ltd ("Tasfast") in the litigation had begun proceedings in the Supreme Court, pursuant to Order 18A of the Supreme Court (General Civil Procedure) Rules 1996 (Vic). That Order permitted and regulated "group proceedings". The validity of the Order, within the rule-making power under the Act[83], was challenged by Mobil.  It was upheld by the Court of Appeal of Victoria[84].  However, the Court of Appeal was divided on the point[85].

   [83]s 25.

   [84]Schutt Flying Academy (Australia) Pty Ltd v Mobil Oil Australia Ltd (2000) 1 VR 545.

   [85]Ormiston, Phillips and Charles JJA; Winneke P and Brooking JA dissenting.

7. Subsequently, the Parliament of Victoria enacted the amending Act introducing Pt 4A into the Act. It did so in response to an earlier suggestion by the judges of the Supreme Court that Parliament should legislate for group proceedings along the lines of Pt IVA of the Federal Court of Australia Act 1976 (Cth)[86].  An application for special leave to appeal to this Court from the Court of Appeal's judgment was initiated.  However, before it could be heard, and ostensibly to set at rest the issue of validity upon which the Court of Appeal had differed[87], the amending Act was brought into effect.  It provided that the new Part would be deemed to have commenced on 1 January 2000[88]. This was some time prior to the day on which Tasfast's statement of claim was filed in the Supreme Court. That process asserted breaches of contract and negligence by Mobil in connection with aviation fuel manufactured by it and supplied to numerous persons in Victoria, New South Wales, Queensland, the Australian Capital Territory and elsewhere in Australia. It was accepted that, if valid, the Act, as amended, would authorise the continuance of Tasfast's proceedings as "group proceedings" in the Supreme Court within Pt 4A of the Act. To that end, Mobil initiated its action in this Court seeking a declaration of invalidity of the amending Act. It discontinued its application for special leave to appeal concerned with the validity of O 18A.

   [86]Explained by Brooking JA in Schutt (2000) 1 VR 545 at 549 [9]. See also at 548 [7] per Winneke P.

   [87]Victoria, Legislative Assembly, Parliamentary Debates (Hansard), 31 October 2000 at 1252.

   [88]The Act, s 33ZK.

8. The facts involved in the dispute between the parties, as disclosed by the pleadings, are described elsewhere[89]. So are the relevant provisions of the Act inserted by the amending Act[90].  In addition to Tasfast, Mobil named the State of Victoria as a defendant to its proceedings.  The State appeared, with Tasfast, to defend the validity of the amending Act.  In this, Tasfast and Victoria were supported by the Attorney-General of the Commonwealth and the Attorneys-General of several of the States[91].

   [89]Reasons of Gaudron, Gummow and Hayne JJ at [27]-[31]; reasons of Callinan J at [146]-[154].

   [90]Reasons of Gleeson CJ at [5]-[6]; reasons of Gaudron, Gummow and Hayne JJ at [35]-[43]; reasons of Callinan J at [155]-[167], [176].

   [91]The Attorneys-General of New South Wales, South Australia and Western Australia intervened.

   Three suggested bases of invalidity

9. Invalid excess of State legislative power:Expressed generally, Mobil's complaints about the constitutional validity of the provision inserting Pt 4A into the Act fell into three basic categories. First, Mobil argued that the Act, as so amended, on its face, went beyond the legislative power of the Parliament of Victoria. It did this because the amended Act purported to permit an exercise of one State's legislative power with respect to matters which, constitutionally speaking, were within the legislative power of other States of the Commonwealth. It therefore represented an over-reach of legislation, passing beyond matters having the requisite connection with the State of Victoria as envisaged by the federal Constitution.

10. This first submission was put in various ways:

    §That the "group proceedings" provided for in Pt 4A of the Act conferred on the Supreme Court a "national jurisdiction" which would allow it to determine claims having no applicable constitutional connection with Victoria;

    §That the "opt out" procedure provided for in Pt 4A of the Act would enable the Supreme Court to assume and exercise jurisdiction over members of the designated "group" not resident in Victoria who had not chosen to invoke the Supreme Court's jurisdiction, were unaware of the group proceedings' existence and possibly not desirous of being part of them; and

    §That Pt 4A constituted the Supreme Court a "national court for the conduct of class actions" and in doing so infringed the limits on the legislative powers of the States as between each other, which limitations flowed from the language and structure of the federal Constitution.

11. Invalid alteration of choice of law rule: Secondly, and assuming that the first complaint was rejected, Mobil submitted that the provisions of Pt 4A of the Act were inconsistent with requirements implicit in the federal Constitution, specifically with s 118 read with s 51(xxiv) and (xxv). It was argued that Pt 4A purported to impose the substantive law of Victoria upon parties not resident in, nor relevantly connected with, Victoria, contrary to the choice of law regime which flowed from the federal Constitution, as recently laid down by the decision of this Court in John Pfeiffer Pty Ltd v Rogerson[92].  The attempt by a State Parliament to do this was said to be in breach of the constitutional basis for the choice of law rule stated in that decision.

    [92](2000) 203 CLR 503 at 535-540 [72]-[87].

12. Invalid inconsistency with Ch III:Thirdly, and assuming that the other complaints were to fail, Mobil submitted that the provisions of Pt 4A of the Act were incompatible with the federal Constitution governing the exercise of judicial power within the integrated Judicature of the Commonwealth:

    §It was inconsistent with s 73 of the Constitution which provides for appeals to this Court "from all judgments, decrees, orders, and sentences" of a Supreme Court of a State. The inconsistency arose, so it was argued, because the determination of "group proceedings", envisaged by Pt 4A of the Act, included the determination of the rights of parties "roped in" as plaintiffs, although they had, or might have, no controversy with Mobil. Any such determination, it was submitted, would not qualify as a "judgment" or "order" within s 73. Although in other respects it might appear to be a conclusive determination of the rights of parties, so far as the law was concerned it was not. Part 4A of the Act was thus an invalid attempt to impose on a State Supreme Court a power to affect rights and obligations insusceptible of appeal to this Court. Hence, it was invalid as inconsistent with the appellate provisions of s 73; and

    §It was also inconsistent with the exercise by the Supreme Court of the judicial power because Pt 4A of the Act was contrary to the principle established in Kable v Director of Public Prosecutions (NSW)[93]. That principle controls the functions and powers that may be conferred upon State courts. It limits such functions and powers to those that are compatible with the continuing exercise by such courts of the federal jurisdiction envisaged for them by the federal Constitution[94].

    [93](1996) 189 CLR 51.

    [94]Constitution, s 77(iii).

    Narrowing the scope of the contest

13. The State of Victoria and Tasfast demurred to Mobil's amended statement of claim.  The demurrers were ordered to be heard before the Full Court.  On the return of the demurrers, Mobil abandoned its argument addressed to what I might call the Kable objection.  That issue can therefore safely be put to one side.

14. Without abandoning its argument based on Pfeiffer, Mobil addressed no oral submissions to advance that contention.  In Pfeiffer, the joint reasons left unresolved the question whether the choice of law rule there favoured was a consequence of the Constitution or simply a rule of the common law influenced by "the constitutional text and structure"[95].  In my concurring opinion, I expressed a view[96] that the Constitution did not itself provide a choice of law rule. "The emerging rule must thus be subject to the Constitution; but the Constitution does not yield its precise content."[97]  Consistently with this approach, there is in my opinion no constitutional basis for challenging the power of the Parliament of Victoria, if otherwise acting within its constitutional authority, to enact a law varying in a particular respect in the case of "group proceedings" the choice of law rule stated in Pfeiffer, assuming that is what it has done.  Accordingly this issue too may be put aside.

    [95]John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 535 [70].

    [96]John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 555-558 [137]-[143].

    [97]John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 558 [143].

    The suggested incompatibility with s 73 of the Constitution

15. Invalid deprivation of the right to appeal:The foregoing analysis confines Mobil's constitutional objections to the legislation to what might be described as the implication of the essential territoriality of State laws and the suggested incompatibility of the new Pt 4A of the Act with the proper functioning of a Supreme Court as envisaged by s 73 of the Constitution. It is convenient first to deal with the second contention.

16. To make its s 73 submission good, Mobil was obliged to persuade this Court to take two steps, namely (1) to hold that a judgment or order made in "group proceedings" is not such a resolution of a controversy between parties as to amount to a "judgment" or "order" of a Supreme Court for constitutional purposes; and (2) to hold that the attempt to impose on a Supreme Court the function or power of giving such a "judgment" or "order", insusceptible of appeal to this Court, breached the requirements of s 73 of the Constitution.

17. The first step in this reasoning is flawed.  It is not uncommon for "judgments" and "orders" of courts in Australia to affect, and indeed bind, persons who took no active part in the proceedings and who may even have been ignorant of the proceedings[98].  Some such persons might not even have been born at the time that the proceeding resulting in the judgment or order was decided[99]. Yet it would indisputably be a "judgment" or "order" within s 73 of the Constitution.

    [98]John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 557 [143]. The history of representative actions, and the defects that occasioned the legislation on group proceedings in Australia, are explained in Australia, Law Reform Commission, Grouped Proceedings in the Federal Court, Report No 46, (1998) at 18-26 [40]-[61].  See also Yeazell, "From Group Litigation to Class Action", (1980) 27 University of California at Los Angeles Law Review 514, 1067 and the passage from Carnie v Esanda Finance Corporation Ltd (1995) 182 CLR 398 at 429-430 cited by Callinan J at [172], fn 204.

    [99]As in the decision of a court on the meaning of a trust deed which will be binding on members of the class, even if not represented in the proceedings, indeed even if not born at the time of the judicial determination.

18. Appeals from State Supreme Courts: It follows that this ground of objection to the validity of Pt 4A of the Act cannot succeed. I would prefer to confine my decision on this part of Mobil's argument to this point. I do this because I am not at present convinced that the authority upon which Victoria and Tasfast relied to repel the second step in this part of Mobil's argument, namely Holmes v Angwin[100], is applicable to a case such as the present.  Holmes was a decision in which, in effect, electoral questions had been submitted to a State Supreme Court by the Parliament of a State.  Such proceedings did not result in something, on any view, intended to be a "judgment" or "order" in the ordinary sense.  So much is made clear by the observation of Barton J[101]:

    "Thus the Act of this State makes provisions as to the effect to be given to the decision of the Court, but it does not make the decision of the Court enforceable in the ordinary way as a judgment."

    [100](1906) 4 CLR 297.

    [101](1906) 4 CLR 297 at 308. See also at 310 per Higgins J; cf Sue v Hill (1999) 199 CLR 462 at 560 [257]-[258], 568-569 [278]-[280].

19. When one examines the terms of Pt 4A of the Act, it is clear[102] that the Victorian Parliament contemplated that a consequence of a judgment entered in "group proceedings" was that it would be a "judgment" or "order" within the ordinary meaning of those terms[103].  In Holmes, Griffith CJ[104], after referring to s 73 of the Constitution, stated that:

    "This is an absolute right of appeal given to suitors, and no State legislation can deprive them of that right."

    [102]See esp the Act, ss 33Z and 33ZB.

    [103]Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 355-357 [45]-[49].

    [104](1906) 4 CLR 297 at 302.

20. It is true that federal legislation can, as the Constitution expressly contemplates, prescribe exceptions to, and regulation of, this Court's jurisdiction to hear and determine appeals from judgments and orders, relevantly, of a Supreme Court of a State[105].  However, as Griffith CJ pointed out long ago, there is no equivalent power in a State Parliament to provide exceptions to, and regulation of, appeals from the Supreme Court of a State to this Court from a "judgment" or "order" of that court[106]. Moreover, even in the case of exceptions or regulations prescribed by the Federal Parliament, s 73 provides that none "shall prevent the High Court from hearing and determining any appeal from the Supreme Court of a State in any matter in which at the establishment of the Commonwealth an appeal lies from such Supreme Court to the Queen in Council".

    [105]Constitution, s 73; cf Abebe v The Commonwealth (1999) 197 CLR 510 at 530 [37]-[38], 588-589 [226]-[228], 603 [273]-[274].

    [106]Constitution, s 73. See Holmes v Angwin (1906) 4 CLR 297 at 302.

21. Given the centrality for the rule of law of the superintendence by this Court of the "judgments" and "orders" of the Supreme Courts of the States, as provided by the Constitution, I would not wish to indicate any concurrence in the whittling down of the obligatory jurisdiction of this Court based on that constitutional postulate. Holmes is a very flimsy foundation for such a large consequence.  It is unnecessary to go to the second step of Mobil's argument in this regard for the submission fails at the threshold.

22. Postponing other possible Ch III questions:It is ordinarily desirable that, where invalidity of legislation is suggested, this Court should deal only with the constitutional arguments which the parties advance[107]. There may, for example, be other unstated arguments, in respect of particular provisions of Pt 4A which later cases, and more promising factual circumstances, will present to be decided by reference to the provisions of Ch III of the Constitution.

    [107]In Wong v Silkfield Pty Ltd (1999) 199 CLR 255 no party advanced an argument that the federal legislation there considered was inconsistent with the requirements of Ch III of the Constitution.

23. For example, I could envisage in a particular case that a party, originally unaware of the group proceedings commenced in the Supreme Court of a State (being a State other than that of the party's residence), not conscious of joinder as a plaintiff, refused permission to opt out and subject to a judgment with which that party was discontented, wishing to proceed in the State of residence, might raise an argument that the implied requirements of due process in Ch III of the Constitution[108] had not been observed. Such an argument, if accepted, might render the judgment or order affecting that party (and any law that purported to sustain it) invalid when measured against the Constitution. But the time to consider such a case, and the severability or reading down of a State enactment that purported to permit it to occur, would be a proceeding in which the party complaining was adversely affected and presented that complaint for resolution by a court.

    [108]Leeth v The Commonwealth (1992) 174 CLR 455 at 487-490 per Deane and Toohey JJ, 501-503 per Gaudron J; Kruger v The Commonwealth (1997) 190 CLR 1 at 112-114 per Gaudron J (diss); Nicholas v The Queen (1998) 193 CLR 173 at 208-209 [73]-[74]; Ebner v Official Trustee in Bankruptcy (2000) 75 ALJR 277 at 289-290 [79]-[82], 295-296 [115]-[116]; 176 ALR 644 at 661-662, 670-671.

24. Approaching Mobil's arguments, as they were advanced in these proceedings, it is enough to say that the premise upon which Mobil submitted that s 73 of the Constitution was offended by Pt 4A of the Act, is not made out. It follows that each of the arguments connected with the second and third categories of Mobil's challenges to the validity of Pt 4A of the Act fails. This leaves the first category. Because I approach it differently from the way adopted by other members of the Court, I am bound to explain why.

    An unpromising factual foundation

25. It is first necessary to recapitulate the unpromising factual foundation presented for Mobil's argument concerning the suggested want of territorial connection with Victoria of Tasfast's proceedings.  On the facts as pleaded, which must be accepted for the purpose of deciding Mobil's demurrer[109], there were many connections between the State of Victoria and the subject matter which Tasfast's statement of claim tendered to the Supreme Court for resolution.

    [109]South Australia v The Commonwealth (1962) 108 CLR 130 at 142, 152; Levy v Victoria (1997) 189 CLR 579 at 648-649; Bass v Permanent Trustee Co Ltd (1999) 198 CLR 334 at 367-368 [81].

1. The Australian Constitution and the federal structure for which it provides, must of necessity contemplate and ensure the unfettered exercise of jurisdiction of the courts of each of the States according to accepted notions of territoriality.  All of the State Constitutions contain similar provisions to s 85 of the Victorian Constitution.  The plaintiff accepts that the language used in s 85 of the Victorian Constitution and like provisions in other States should not be read in any narrow fashion[207]. However, a consistent, expansive reading and application of all State Constitutions has the capacity to cause, and will inevitably do so, conflicts of jurisdiction, and forum poaching: it is only when the jurisdiction of one State is under consideration, that there may be no immediately apparent problem. The Victorian legislature, by the Victorian Act, has attempted to make the Supreme Court of Victoria a national court for the conduct of class actions: this is so because it has the potential, if the Supreme Court Act is valid, to draw residents of other places into proceedings in Victoria as plaintiffs in circumstances in which their claims have no necessary connexion with Victoria, they have not invoked the jurisdiction of that Court and they might wish, for perfectly valid reasons, to bring proceedings in jurisdictions other than Victoria.

   [207]See Pearce v Florenca (1976) 135 CLR 507 at 518 per Gibbs J; Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1; Port MacDonnell Professional Fishermen's Association Inc v South Australia (1989) 168 CLR 340 at 372.

2. The plaintiff accepts that there is a body of choice of law rules to apply to cases in which jurisdiction is founded simply upon service of process on the defendant whilst the defendant is in the relevant jurisdiction. The plaintiff does not accept however that the existence of that body of rules denies the force of its argument that there must be some limit upon the jurisdiction of a State Supreme Court, and that limit should be imposed by this Court, if its exercise has a tendency to interfere with, or impinge upon the extra-territorial jurisdiction and powers of another State. The plaintiff's proposition does not go so far as to seek to confine a State Supreme Court's jurisdiction to cases in which the subject matter arises within the State in which the jurisdiction is being exercised. The plaintiff's submissions are made in the context of this case, and with a degree of particularity which is related to the breadth and reach of the Victorian Act and its presumption in, among other things, purporting to suspend the operation of all statutes of limitation, including those of other jurisdictions. It is no answer, the plaintiff submits, that already there are cases in which similar, if not identical issues, can be raised in the courts of two States between the same or related parties, and that the difficulties to which they give rise can be resolved by the application of principles concerning abuse of process, or by the application of cross-vesting legislation. What distinguishes those cases is that the plaintiffs in them are ordinarily fully voluntary, moving parties, pursuing proceedings of their choice in jurisdictions which they have chosen and are entitled to choose.

   The resolution of the demurrer

3. In my opinion, several matters, some of which were adverted to in the plaintiff's submissions, do have to be taken into account in resolving the issues in this case.

4. First, Pfeiffer[208] holds that the law to be applied in cases of tort is the law of the place of the commission of the tort.  What is not completely settled in cases of torts of product liability is how the place of the commission of the tort is to be determined, whether by reference to the place of design, manufacture, assembly, supply, consumption, or even of advertisement.  True it is in a case of tort that damage is said to be the gist of the action, but equally, there will be no damage but for the defective design, manufacture, assembly or supply, as the case may be, wherever that occurred.  Arguments can be persuasively advanced to locate the tort in any of the suggested places.  This Court on balance appears to have adopted a test which is tantamount to asking the question, "where, in substance, did the act take place?"[209]  Four Justices[210], although they did not refer in terms to the "substance" of the cause of action, an expression used by the Privy Council in Distillers Co (Biochemicals) Ltd v Thompson[211], in looking to "the act on the part of the defendant which gives the plaintiff his cause of complaint", were effectively adopting the same or a very similar approach to their Lordships in that case.  The proposition that the best place for a trial will usually be the place where the defendant misconducted itself or omitted to do something (except in cases to which longstanding different rules based on different considerations apply, such as defamation and injurious falsehood cases), rather than where seven people are able to congregate to start an action, is I think, the preferable one.

   [208](2000) 203 CLR 503.

   [209]See Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538 at 567-568 per Mason CJ, Deane, Dawson and Gaudron JJ. See also Macgregor v Application des Gaz [1976] Qd R 175 at 176.

   [210]Mason CJ, Deane, Dawson and Gaudron JJ.

   [211][1971] AC 458.

5. Secondly, even though the availability of "long arm" jurisdiction is an accepted legal fact of life recently affirmed by this Court in an international setting[212], a serious question remains whether, or, as to the extent to which, the arms of one State should, in a federation, be permitted to reach into and pick the pockets of the jurisdiction of another.

   [212]Regie National des Usines Renault SA v Zhang (2002) 76 ALJR 551; 187 ALR 1.

6. Thirdly, given the realities of competition between the States, which in many respects may by no means be undesirable, I would expect that other States will perceive the Victorian legislation to be a pre-emptive grab for national ascendancy in class actions, and therefore to be met with the enactment of similar legislation to confer upon their own courts the same jurisdiction.  And because many business people carry on business in all States and Territories of the Commonwealth, the potential for confusion and uncertainty in the courts in that likely event will be great.

7. Fourthly, the problems to which I have just referred are likely to be aggravated by the increasingly competitive entrepreneurial activities of lawyers undertaking the conduct of class or group actions, in which, in a practical sense, the lawyers are often as much the litigants as the plaintiffs themselves, and with the same or even a greater stake in the outcome than any member of a group.  This reality is likely to be productive of a multiplicity of group actions throughout the country.

8. Fifthly, s 118[213] of the Constitution must be given effect, and the question is how that may be achieved when one or more States legislate as Victoria has. Five Justices of this Court (Gleeson CJ, Gaudron, McHugh, Gummow and Hayne JJ) in Pfeiffer[214] referred to the problems of applying the statute law of two law areas when the laws differ. In that case it was unnecessary to reach a concluded view of the operation of s 118 of the Constitution but their Honours said this of it[215]:

   "In its terms, s 118 does not state any rule which dictates what choice is to be made if there is some relevant intersection between legislation enacted by different States. Nor does it, in terms, state a rule which would dictate what common law choice of law rule should be adopted. It may well be, however, that s 118 (and in some cases s 117, or even s 92 in its protection of individual intercourse[216]) deals with questions of competition between public policy choices reflected in the legislation of different States – at least by denying resort to the contention that one State's courts may deny the application of the rules embodied in the statute law of another State on public policy grounds[217].

   In Merwin Pastoral Co Pty Ltd v Moolpa Pastoral Co Pty Ltd[218], Rich and Dixon JJ and Evatt J suggested that s 118 precludes the courts of one State from concluding (as the primary judge had in that case) that the application of the statute of another State 'would at the stage and in the circumstances in which it was invoked work manifest injustice to or, in effect, a fraud on one of the parties'[219].  And in [Breavington v Godleman], six members of the Court appear to have accepted that s 118 may preclude the refusal of one State to apply the law of another on the grounds of public policy where the law of that other State is otherwise applicable[220]. However, it may also be that s 118 suggests that the constitutional balance which should be struck in cases of intranational tort claims is one which is focused more on the need for each State to acknowledge the predominantly territorial interest of each in what occurs within its territory than it is on a plaintiff's desire to achieve maximum compensation for an alleged wrong.

   It has been said that the giving of full faith and credit to the law of another State only when the choice of law rules of the forum point to that law 'is to give full faith and credit to one's own law rather than to that of the sister-state, a fact which the unity of the common law in Australia has so far concealed'[221]. And there was a deal of debate in the oral argument in the present case about the effect of s 118. Some of those questions were considered in Breavington[222] but not resolved by the formulation of a choice of law rule deriving its force from s 118. However, the terms of s 118 indicate that, as between themselves, the States are not foreign powers as are nation states for the purposes of international law. That apart, it is not necessary in the present matter to resolve other questions respecting s 118. The matter is to be resolved, in our view, by developing the common law to take account of federal jurisdiction as delineated in Ch III of the Constitution and, also, to take account of the federal system in which sovereignty is shared between the Commonwealth and the member States of the federation."

   [213]"Recognition of laws etc of States

   Full faith and credit shall be given, throughout the Commonwealth to the laws, the public Acts and records, and the judicial proceedings of every State."

   [214](2000) 203 CLR 503 at 515 [3].

   [215](2000) 203 CLR 503 at 533-534 [63]-[65].

   [216]AMS v AIF (1999) 199 CLR 160.

   [217]cf Loucks v Standard Oil Co of New York 120 NE 198 at 202 (1918).

   [218](1933) 48 CLR 565 at 577, 587-588.

   [219]Moolpa Pastoral Co Pty Ltd v Merwin Pastoral Co Pty Ltd unreported, Supreme Court of Victoria per Macfarlan J cited (1933) 48 CLR 565 at 577 per Rich and Dixon JJ.

   [220](1988) 169 CLR 41 at 81, 96-97, 116, 133-134, 150.

   [221]D St Leger Kelly, "Chief Justice Bray and the Conflict of Laws", (1980) 7 Adelaide Law Review 17 at 27-28.

   [222](1988) 169 CLR 41 at 81-82, 95-100, 116-117, 129-136, 150.

9. It is also relevant in this context to refer to their Honours' reflections upon the difficulties of application of the rules for choice of law that can arise when plaintiffs have two or more causes of action or choices of jurisdiction[223].

   "Difficulty will arise in locating the tort when an action is brought, for example, for product liability and the product is made in State A, sold in State B and consumed or used by the plaintiff in State C[224].  And the tort of libel may be committed in many States when a national publication publishes an article that defames a person[225].  These difficulties may lead to litigants seeking to frame claims in contract rather than tort (as the [WorkersCompensation Act 1987 (NSW)] anticipated[226]) or for breach of s 52 of the Trade Practices Act 1974 (Cth) or some similar provision. Characterising such actions may be difficult and may raise questions whether the private international law rules about tort or some other rules are to be applied[227].

   Moreover, even if the place of the tort can be located in a single jurisdiction, it will often enough be entirely fortuitous where the tort occurred.  Why, so the argument goes, should the rights of Victorian residents injured when the car in which they are driven (by another Victorian) differ according to whether, if a driver falls asleep and the car runs off the road near the Victorian border, it does so south of Wodonga or north of Albury?  But for every hard case that can be postulated if one form of universal rule is adopted, another equally hard case can be postulated if the opposite universal rule is adopted.

   It is as well then to compare the consequences of the application, in cases of intranational torts, of the lex loci delicti with the consequences of applying the lex fori.  If the lex loci delicti is applied, subject to the possible difficulty of locating the tort, liability is fixed and certain; if the lex fori is applied, the existence, extent and enforceability of liability varies according to the number of forums to which the plaintiff may resort and according to the differences between the laws of those forums and, in cases in federal jurisdiction, according to where the court sits.

   From the perspective of the tortfeasor (or in many cases an insurer of the tortfeasor) application of the lex loci delicti fixes liability by reference to geography and it is, to that extent, easier to promote laws giving a favourable outcome by, for example, limiting liability.  If the lex fori is applied, the tortfeasor is exposed to a spectrum of laws imposing liability.

   From the perspective of the victim (the plaintiff) application of the lex loci delicti can be said to make compensation depend upon the accident of where the tort was committed, whereas, if the lex fori is applied, the plaintiff can resort to whatever forum will give the greatest compensation."

   [223]John Pfeiffer Pty Ltd v Rogerson (2000) 203 CLR 503 at 538-540 [81]-[85].

   [224]cf Distillers Co (Biochemicals) Ltd v Thompson [1971] AC 458; Buttigeig v Universal Terminal & Stevedoring Corporation [1972] VR 626; Macgregor v Application des Gaz [1976] Qd R 175; Jacobs v Australian Abrasives Pty Ltd [1971] Tas SR 92.

   [225]McLean v David Syme & Co Ltd (1970) 72 SR (NSW) 513; David Syme & Co Ltd v Grey (1992) 38 FCR 303; Berezovsky v Michaels [2000] 1 WLR 1004; [2000] 2 All ER 986.

   [226]s 151E.

   [227]Collins, "Interaction between Contract and Tort in the Conflict of Laws", (1967) 16 International and Comparative Law Quarterly 103; Pryles, "Tort and Related Obligations in Private International Law", (1991) II Recueil des Cours 9 at 166-191.

10. On an earlier occasion, in 1989, this Court[228] (Mason CJ, Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ) discussed, without resolving, the difficulties that can arise when States legislate in respect of matters with which each has a legitimate connexion:

    "A problem of greater difficulty would have arisen if the fishery defined by the arrangement had a real connexion with two States, each of which enacted a law for the management of the fishery. The Constitution contains no express paramountcy provision similar to s 109 by reference to which conflicts between competing laws of different States are to be resolved. If the second arrangement had been construed as extending to waters on the Victorian side of the line of equidistance, there would obviously have been grounds for arguing that the Victorian nexus with activities in these waters was as strong as or stronger than the South Australian nexus. As has been seen, however, the second arrangement does not extend into such waters. Where, as here, there is no suggestion of the direct operation of the law of one State in the territory of another, the problem of conflicting State laws arises only if there be laws of two or more States which, by their terms or in their operation, affect the same persons, transactions or relationships. In the present case, there is no competing law of a State other than South Australia purporting to apply to or in relation to the fishery to which the second arrangement applies. That being so, there is no real question of any relevant inconsistency between the law of South Australia and the law of another State."

    [228]Port MacDonnell Professional Fishermen's Association Inc v South Australia (1989) 168 CLR 340 at 374.

11. Sixthly, although it is now settled that there is only one common law for the whole of Australia, the States' relevant enactments are different in many
    

    [229]Section 131 of the Motor Accidents Compensation Act 1999 (NSW) puts limits on recoverable damages in respect of non-pecuniary loss suffered from motor accidents. Those losses are recoverable only if the claimant's ability to lead a normal life is substantially impaired by the injury. Should damages be recoverable, a statutory ceiling has been set to limit the maximum amount of damages recoverable.

    In South Australia, there are similar limits on the amount of damages recoverable at common law in motor accident claims:  Wrongs Act 1936 (SA), s 35A(1).

    In Victoria, common law actions may be brought for motor accidents only if the victim suffers a "serious injury":  Transport Accident Act 1986 (Vic), s 93(2). Like New South Wales and South Australia, that State places statutory limits on maximum damages awards: Transport Accident Act 1986 (Vic), ss 44-62.

    [230]WorkCover Queensland Act 1996 (Q), s 11, s 50, s 207, s 252, s 253, s 256, s 259, s 262, s 302; Bonser v Melnacis [2002] 1 Qd R 1.

    From 1 July 1984 common law actions for transport related accidents were abolished for Northern Territory residents by s 5 of the Motor Accidents (Compensation) Act 1979 (NT). The Act defines a "resident" as a person resident in the Northern Territory for three months prior to the accident: Motor Accidents (Compensation) Act 1979 (NT), s 4.

    Further, actions for loss of consortium are no longer allowed in New South Wales (Law Reform (Marital Consortium) Act 1984 (NSW), s 3) and Tasmania (Common Law (Miscellaneous Actions) Act 1986 (Tas), s 3). By contrast, in Queensland (Law Reform Act 1995 (Q), s 13) and South Australia (Wrongs Act 1936 (SA), s 33), the consortium action has been extended to permit wives to recover for the loss of their husband's services.  The action for loss of consortium continues in an unamended form in Victoria – it is available only to husbands who lose the consortium of their wife.

    [231]Defamation Act 1974 (NSW), s 46(3)(a).

    [232]See discussion Agar v Hyde (2000) 201 CLR 552 at 601 [130]-[131] per Callinan J.

    [233]For instance, as each State develops its workers' compensation, transport accident compensation, criminal injuries compensation and sporting accident compensation legislative schemes.

    respects.  Some have capped or otherwise limited[229] or even abolished[230] damages for personal injuries.  In New South Wales exemplary damages are not recoverable[231] in defamation actions.  In Queensland they are.  Provisions for the enlargement of periods of limitation are perhaps more generous, or may be more generously applied in New South Wales[232] than they are in Queensland.  These are examples of significant differences of both substantive and perhaps procedural law that immediately come to mind.  In current practice, and in the future, there are, and will be many others[233]. If each State were to enact, and the courts were to be required to give full effect to the potentially imperialistic legislation of the kind now to be found in Pt 4A of the Supreme Court Act, then the courts of the States will be confronted with endless conflicts that will defy satisfactory resolution.

12. As the majority judgment[234] points out, the claims of some claimants may arise out of events and transactions occurring wholly outside Victoria, and the claimants may have no connexion at all with that State:  but as the plaintiff was incorporated, served with process, carried on business in, and "released fuel" from, Victoria, there is no doubt that the Victorian Supreme Court has jurisdiction.  It is questionable however, whether it should have an unfettered right to exercise that jurisdiction in respect of group members outside Victoria who have either failed to become aware of the proceedings, or have not opted out.

    [234]Reasons of Gaudron, Gummow and Hayne JJ at [42].

1. Finally, whilst it has twice been unanimously held by this Court[235] that a remote or a general connexion between a State and the subject matter of the legislation will suffice to validate that legislation, it is significant that those holdings were not made in a setting of equal competing connexions of the kind in prospect here.

   [235]Union Steamship Co of Australia Pty Ltd v King (1988) 166 CLR 1; Port MacDonnell Professional Fishermen's Association Inc v South Australia (1989) 168 CLR 340 at 374.

2. Having regard to the matters that I have enumerated I have formed the opinion that Pt 4A of the Supreme Court Act, although not invalid, must be read down so that its operation is confined to each of the following:

   (i) group members resident in Victoria;

   (ii) group members carrying on business in Victoria;

   (iii) group members registered or incorporated in Victoria;

   (iv) group members wherever resident, registered or carrying on business outside Victoria, positively electing (and not merely not opting out) to be group members:

   in cases in which, by reason of service there, or for other good and settled principle of common law, or by statute, the defendant is amenable to the jurisdiction of the Victorian Supreme Court.

3. To go beyond those groups would, in my opinion be to go beyond what is properly to be regarded as even a remote connexion with Victoria.  I find myself forced to this conclusion in particular:  because of the great, if not insurmountable, but unnecessary difficulties to which the uninhibited exercise of the jurisdiction conferred by the Supreme Court Act and like State Acts by more than one State over transnational causes of action would give rise; the operation of s 118 of the Constitution which would be offended if, for example, the Victorian Supreme Court were able to disregard or suspend a limitations provision of another State which would otherwise immediately apply to the cause of action, or were permitted to disregard the requirements for a guardian ad litem of another State, or were free to distribute damages from a fund, different, as to its heads or the quantum thereof, from those to which a plaintiff might be entitled in other proceedings in another State.

4. In practice, having regard to the Court's extensive powers over group litigation, and the practical control exerted by the named seven group members and their lawyers, other group members out of Victoria are unlikely to have any real influence, let alone control over the proceedings. The reality of the difference between a voluntary and an involuntary plaintiff is not to be minimized. Section 118 of the Constitution at the very least requires as a matter of comity between States due deference to the reasonable exercise of the jurisdictions of the courts of each of them. The unrestricted operation of Pt 4A of the Supreme Court Act would fail to pay that deference.  Victoria may authorize the conscription of its own plaintiffs but not those of other States.

5. That at present there can be overlapping aspects of procedures, rules and judgments of courts within the federation which have hitherto been resolved by current principles and rules (not always, it may be added, readily capable of clear articulation and application and often involving discretionary matters upon which minds often differ) as to stays, prevention of abuses of process and cross-vesting, provides no reason for the compounding of conflicts.

6. Subject to the correctness or otherwise of the plaintiff's second argument, because the legislation is valid to the extent that I have indicated, no question of severability arises.

7. The plaintiff's other argument is based upon Kable v Director of Public Prosecutions (NSW)[236]:  that the Supreme Court Act purports to vest in the Victorian Supreme Court powers incompatible with the exercise of judicial power and in particular the investment of Commonwealth judicial power.  In view of the decision of the majority allowing the demurrer, any decision by me on this aspect of the case could not affect the outcome of the demurrer.  That, taken with the desirability of considering such an argument in the context of a particular ruling on a particular section or event, means that this is not an occasion for the resolution of that issue.

   [236](1996) 189 CLR 51.

8. Part 4A of the Supreme Court Act should be regarded as valid but it should be read so that its operation is confined in the way that I have stated.  I would allow the demurrer in part.  Both parties have therefore had some success.  I would accordingly make no order as to costs.