R v Foster; Ex Parte Eastern and Australian Steamship Co Ltd

The parties to this matter were R (the Crown) and Eastern and Australian Steamship Co Ltd, which sought a writ of prohibition. The dispute concerned the jurisdiction of the Commonwealth Court of Conciliation and Arbitration to make an order against the company. The case was heard by the High Court of Australia.

The central legal issue before the High Court was whether the Commonwealth Court of Conciliation and Arbitration had the constitutional power to make an order directing the company to pay certain sums of money to its employees, which were described as "long service leave payments." This question turned on the interpretation of section 71 of the Constitution, which vests the judicial power of the Commonwealth in the High Court and other federal courts, and the extent to which the Arbitration Court, a body established under federal legislation, could exercise such power.

The High Court reasoned that the Arbitration Court, as an arbitral tribunal rather than a court exercising the judicial power of the Commonwealth, could not make orders that were purely coercive or punitive in nature, such as directing the payment of a debt. While the Court acknowledged the broad powers of the Arbitration Court to settle industrial disputes, it held that the power to order the payment of money, in the form of long service leave entitlements, was an exercise of judicial power. This power, the Court concluded, could only be vested in courts established under Chapter III of the Constitution.

Consequently, the High Court made absolute the order nisi for a writ of prohibition, preventing the Commonwealth Court of Conciliation and Arbitration from enforcing its order for the payment of long service leave.