NTL Australia Pty Ltd v Minister for Land and Water Conservation

[2003] HCATrans 659

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Sydney  No S227 of 2002

B e t w e e n -

NTL AUSTRALIA PTY LIMITED

Applicant

and

MINISTER FOR LAND AND WATER CONSERVATION

Respondent

Application for special leave to appeal

GUMMOW J
HEYDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 11 APRIL 2003, AT 11.40 AM

Copyright in the High Court of Australia

MR D.F. JACKSON, QC:   If the Court pleases, I appear with my learned friend, MR A.E. GALASSO, for the applicant.  (instructed by Minter Ellison)

MR B.A.J. COLES, QC:   If your Honours please, I appear with MR A.A. HYAM for the respondent.  (instructed by Department of Land and Water Conservation)

GUMMOW J:   Mr Jackson, we have to get the names right first, I suppose.

MR JACKSON:   Yes, I was going to say that, your Honour.  Your Honours will see that our name has changed.  We seek an order as per paragraph 1 at page 87.

GUMMOW J:   Yes, and you seek a name change too.

MR COLES:   I seek a name change, too, if your Honours please, by motion filed in the Court on 10 April 2003.

GUMMOW J:   Yes.  There will be orders changing the title of the applicant to Broadcast Australia Pty Ltd and of the respondent to Minister Assisting the Minister for Natural Resources (Lands).  We would be indebted to hear first from you, Mr Coles.

MR COLES:   Thank you, your Honours.  Your Honours, the principal matter put against us in the submissions of the applicant in effect describes error to the Court of Appeal ‑ ‑ ‑

GUMMOW J:   The majority of the Court of Appeal.

MR COLES:   ‑ ‑ ‑ in drawing a distinction between transfer on the one hand and vesting on the other.

GUMMOW J:   Now, just assist me in this.  Is there not a federal dimension in all this?  This was federal jurisdiction, was it not?  People were busily construing this rather important federal statute which had this immediate impact upon the rights of the parties.

MR COLES:   They were certainly doing that, your Honour.  They were certainly construing the federal statute.

GUMMOW J:   It seems to me, having regard to what was said in LNC v BMW (1983) 151 CLR 575 at 581, that there was federal jurisdiction being exercised and, secondly, is there not a dimension here on one view of it of section 109 of the Constitution?

MR COLES:   The manner in which the proceedings thus far ‑ ‑ ‑

GUMMOW J:   We might take this up with Mr Jackson, if he obtains his grant of ‑ ‑ ‑

MR COLES:   I can only tell your Honour, Mr Jackson not having previously appeared in the courts below ‑ ‑ ‑

GUMMOW J:   That is right.

MR COLES:   ‑ ‑ ‑ the case has thus far proceeded without any regard for any perceived ‑ ‑ ‑

GUMMOW J:   (a) that it was federal jurisdiction or (b) there might be a constitutional question.

MR COLES:   Because the view has been taken, your Honours, that the matter is able to be resolved in the manner the Court of Appeal resolved it without recourse to those additional complexities.

GUMMOW J:   Yes.

MR COLES:   If that is right, that will remain the position.

GUMMOW J:   Now, what do you say about this covenant appearing at page 49, paragraph 6, “The tenant shall not” et cetera?  Is that a critical provision?

MR COLES:   It is a critical provision, your Honour, yes.  We say about it the following.

GUMMOW J:   Well, “shall not”.  It does not mean shall not suffer by operation of law, does it?

MR COLES:   No.  The prohibition on the tenant parting with possession “without the consent of the Minister” may have produced certain consequences that if, prior to the amendment to the relevant State legislation, a tenant had purported to transfer his interest in the right of occupation, the Minister might then have consented and that would have created in favour of that supposed transferee a new permissive occupancy under the then provisions of section 136K of the then Crown Lands Act.

All of that has now been swept away and it is no longer possible to create permissive occupancies under Crown land in New South Wales with the result that - what we really say about section 6 is it really dropped out of the equation once the State Act was amended.

GUMMOW J:   And this question now being ‑ ‑ ‑

MR COLES:   I add to that, your Honour, ceased to be of relevance really although the point was not taken in these precise terms to any issue in these proceedings.

GUMMOW J:   Yes. Now, this question set out on page 47 in paragraph 32:

Whether the permissive occupancy granted by the Minister was revoked by reason of the declaration –

Who framed that?

MR COLES:   I am not sure we are in a position precisely to point the bone, as it were, your Honours, but someone on our side, I think to be fair.

GUMMOW J:   The federal law took effect.

MR COLES:   The federal law took effect ‑ and this is our short answer, in effect, to the proposition put against us - with respect to assets as defined and defined very broadly in the Network Sale Act.  It took effect, however, only in relation to those assets according to the nature and incidence of those assets so that in this case the asset in question being, in effect, a personal right enjoyable by an occupant at the will of the State Minister could not be a personal right capable of being enjoyed ‑ ‑ ‑

GUMMOW J:   Well, this personal right had no existence in general law, did it?  It is a statutory creature, State statutory creature.

MR COLES:   It is a statutory creature of what was then section 136K.

GUMMOW J:   Yes, but a State statutory creature.

MR COLES:   A State statutory creature, your Honour, yes, quite.  Now, that general law right ‑ ‑ ‑

GUMMOW J:   And then something happens under a federal law which has an impact on it.

MR COLES:   Yes, but has an impact on it – and this is the point we emphasise – according to the terms, content and incidence of the right in question and the terms and incidence of the right in question was that it was a right enjoyable only by the object of the right so long as the will of the State Minister applied to that object.  Once that object ceased to be the object, the object in this case being the Commonwealth, and some new object was purportedly put forward in its place then the Minister’s will was not positioned with respect to that object.

It is neither the purpose nor the effect and it is certainly not the intention of the federal Act to reposition the State Minister’s will to direct it towards another object.  In other words, to put it shortly, the federal Act simply takes the assets, the subject of the National Transmission Network Sale Act, takes those assets according to the qualities they enjoy under the general law, in this case defeasibility upon the general law applicable to this particular form of statutory personal right.

GUMMOW J:   Yes.  There may be some traps in there.

MR COLES:   Now, if that is right, your Honour, then unless the Network Sale Act has a different operation, that is to say it creates a new right, which was what Justice Hodgson in his dissenting judgment thought, then there was no right existing at the time of the Minister’s gazette which was capable of vesting at all in some new supposed object of the State Minister’s will, that being a will that cannot on any view be transposed, as it were, in favour of some other object.

We emphasise, your Honour, it is not on any view the purpose of the Network Sale Act to do more than vest the assets of the transmission network in the new entity and it does that, we would say, according to the quality of those assets.  If they are expired leases, then what the assignee or the person in whom the assets become vested takes is an expired lease.

If, in the example we gave in our submissions, instead of being a permissive occupancy it was a lease for a term of years which expired on a day certain and that day certain corresponded with the date of the Minister’s gazettal, then what the new entity took by the vesting provisions of the legislation was that expired lease and no more, that is to say nothing because that was the incident and quality and inherent ingredient of the right in question. 

GUMMOW J:   Thank you.  Yes, Mr Jackson.

MR JACKSON:   Thank you, your Honours. Your Honours, as is apparent from our reply at page 85 paragraph 3, there has not been a challenge to the validity of the National Transmission Network Sale Act at any point.

GUMMOW J:   No.

MR JACKSON:   Therefore, the starting point, one would think, would be that it should be given effect according to its terms.  Once one does that, one sees that the effect of the declaration made under it was threefold.  The first thing was that the asset vested in the applicant.  There was no conveyance, assignment or transfer.  The second thing was that the applicant was the Commonwealth’s successor in law in relation to the asset.  The third thing was that the operation of the declaration did not place the Commonwealth in breach of the term preventing assignment.  They are sections 9 and 12.

Your Honours, the approach taken by the majority in the Court of Appeal can be seen at page 46 paragraph 28 in Justice Sheller and your Honours will see that essentially – and I am referring to about line 15 and following – what was held was the vesting was not effected because it “terminated the permissive occupancy”.

Your Honours, that appears to have been based upon the proposition one sees two pages earlier in paragraph 21 commencing at line 10 where his Honour said that:

The law applicable, it seems to me, to a permissive occupancy means that –

whatever be its precise nature, to put it shortly –

since assignment is prohibited without the consent of the Minister, a purported assignment without such consent operates as a termination of the licence or tenancy.

Now, your Honours, we would say in relation to that that as Justice Hodgson said at page 59 paragraph 61, the first thing was that the rights were statutory and the starting point was to be found in the statutes rather than the general law and again, as his Honour said, in paragraph 64 on the next page condition 6 of the licence appeared to make it apparent that the rights were capable of transfer.

GUMMOW J:   Where do we find 6?

MR JACKSON:   Condition 6, the one your Honour ‑ ‑ ‑

GUMMOW J:   Yes, where is it?

MR JACKSON:   It can be seen in miniature form on page 1, if I can put it that way.

GUMMOW J:   Yes, I have it.  Thank you.

MR JACKSON:   But, your Honours, if I could come back then to the majority for just a moment, underlying the views of the majority appears to be the notion that is encapsulated in a passage from Chief Justice Jordan which is quoted by Justice Sheller at page 42 paragraph 17.  What is said is that – and it is really the second sentence of the quotation:

A purported assignment by a tenant at will, if followed by the giving up of a premises, operates as a termination of the tenancy, because it is inconsistent with an intention on his part that his personal tenancy shall continue.

GUMMOW J:   This is all general law.

MR JACKSON:   Your Honour, I was just about to say one could not find a more emphatic statement of an intention that the interest continue than that to be found in sections 9(1) and 12(c) and, your Honours, in our submission, this is a case where there was prima facie error on the part of the Court of Appeal in the approach which it took to the matter and we would submit that for the reasons we have set out at page 77 paragraphs 21 and 22 the case merits the attention of the Court.

Your Honours, if necessary, I can give your Honours a short schedule showing a number of pieces of Commonwealth legislation in which very similar language is used.

GUMMOW J:   Yes.  Now, we have an anxiety that section 109 will step out of the wings at some stage.  If there were a grant of special leave, consideration really should be given to whether 78B notices had to be given.

MR JACKSON:   Yes, your Honour.  Your Honour, I accept that.  Your Honours, I referred at the start of our oral submissions to the fact that the point had not ‑ ‑ ‑

GUMMOW J:   Not as to validity of the federal Act.

MR JACKSON:   Not as to the validity, your Honour, so that, prima facie, one would apply it and its application in one sense does not give rise to an inconsistency with an application point.  On the other hand, it may, on one view, give rise to an inconsistency point.  Your Honour, we would have no difficulty in giving appropriate section 78B notices.

GUMMOW J:   Yes, thank you, Mr Jackson.  Yes, Mr Coles.  Do you want to say anything else?

MR COLES:   The point at issue, your Honour, is whether the federal Act evinces an intention to continue an interest as opposed to merely vest it and we say that all one can see from the Act is an intention not to prolong an interest if the interest is already determined.

GUMMOW J:   I realise that.  It is fairly heroic to say that there is no serious question about that.

MR COLES:   I have not put that, your Honour.

GUMMOW J:   I know you have not, but that is what we have to think about.

MR COLES:   I should say, your Honours, thus far no issue of section 109 or the validity of that has arisen, principally, of course, because the parties to the present proceedings do not include the Commonwealth of Australia.

GUMMOW J:   Yes.

MR COLES:   That is not necessarily a circumstance that, I suppose, your Honour, will have to go unnoticed.

GUMMOW J:   No.  Yes, there will be a grant of special leave in this matter.  It will be a one‑day case, I would have thought?

MR JACKSON:   Yes, your Honour.

GUMMOW J:   Yes.  Thank you, gentlemen.

AT 11.55 AM THE MATTER WAS CONCLUDED