Rothmans of Pall Mall (Australia) Ltd v WA

[2002] HCATrans 211

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
  Perth  No P6 of 2001

B e t w e e n -

ROTHMANS OF PALL MALL (AUSTRALIA) LTD

Applicant

and

STATE OF WESTERN AUSTRALIA

First Respondent

THE COMMISSIONER OF STATE TAXATION (WESTERN AUSTRALIA)

Second Respondent

Application for special leave to appeal

GUMMOW J
HAYNE J

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO CANBERRA

ON FRIDAY, 31 MAY 2002, AT 1.07 PM

Copyright in the High Court of Australia

MR N.W. McKERRACHER, QC:   May it please your Honours, I appear for the applicant.  (instructed by Clayton Utz)

MR R.M. MITCHELL:   May it please your Honours, I appear for the respondents.  (instructed by the Crown Solicitor for the State of Western Australia)

GUMMOW J:   Yes.

MR McKERRACHER:   Your Honours, there are some procedural matters.  Can I move for leave to amend the application and the draft notice of appeal to incorporate the ground articulated at 2.9 in the minute of amended application that:

The plaintiff is entitled to proceed against the first defendant and the second defendant without complying with section 6 of the Crown Suits Act or section 47A of the Limitation Act by virtue of section 64 of the Judiciary Act 1903 (Cth).

GUMMOW J:   Yes.  Before we come to that, you have sued both the State and the Commissioner of State Taxation.

MR McKERRACHER:   Yes.

GUMMOW J:   What relief do you seek against the Commissioner of State Taxation?

MR McKERRACHER:   The relief effectively, in the alternative, is declaratory relief.  The Commissioner of State Taxation is the entity which collects the funds for the Crown.

GUMMOW J:   Yes, but you want money at the end, do you not?

MR McKERRACHER:   Yes.  Ultimately if the money is with the Crown, as one would expect, the relief would be against the Crown.

GUMMOW J:   Yes.  So the only relief you seek against the Commissioner is declaratory relief.  That has to be right, does it not?

MR McKERRACHER:   That would be correct, I think, your Honour.

GUMMOW J:   Right.  Well, that may have some bearing on which of these two Western Australian statutes applies, may it not?

MR McKERRACHER:   Well, mere declaratory relief should not be prohibited.

GUMMOW J:   Well, that may be a question.

MR McKERRACHER:   Yes, it does have a bearing ‑ ‑ ‑

GUMMOW J:   I am just trying to tease out what the parameters might be.

MR McKERRACHER:   Yes.

GUMMOW J:   Yes, thank you.  Well, I will ask Mr Mitchell.  Is that leave opposed, Mr Mitchell?

MR MITCHELL:   The application for leave to amend is not opposed, your Honour.

GUMMOW J:   Thank you.  Yes, Mr McKerracher.  You have that leave.

MR McKERRACHER:   May it please your Honour.  I also indicate that notices have been served to the Attorneys, who have indicated that they do not wish to intervene in relation to the supplementary argument.

GUMMOW J:   Yes.

MR McKERRACHER: Your Honours, shortly put, we would submit this is an appropriate case for special leave as it is a perfect vehicle for resolution of the principal remaining issue in relation to section 64 of the Judiciary Act, namely, whether it can bind the States in a substantive sense.

GUMMOW J:   I am not sure that is an outstanding issue actually, but anyhow, it may be.

MR McKERRACHER: The only case on which we are aware of that having been authoritatively determined in a clear way relevant to these proceedings was in the Court of Appeal in New South Wales by his Honour Justice Kirby, as he then was. In the High Court we do not understand that position to have been resolved. If we are correct in that submission, then we would submit that the effect will be that there would be, by virtue of section 64, no need for service of the notice under either of the Acts. We would say that that is ‑ ‑ ‑

GUMMOW J:   Wait a minute.  Under either of the Acts?

MR McKERRACHER:   Because in issuing proceedings against either of the entities we would be entitled to be treated as nearly as possible as the same subject as to subject and there would be in no such circumstance a requirement of issue of a notice of this nature.  There is simply no other such requirement.

GUMMOW J:   But how does section 64 operate on section 47A? That is one of the points Mr Mitchell makes, I think.

MR McKERRACHER: Well, 47A may be imported into section 64 by virtue ‑ ‑ ‑

GUMMOW J:   It is the other way around. How does section 64 operate on 47A?

MR McKERRACHER: Well, to the extent it does, it would be virtue of section 79 but ‑ ‑ ‑

GUMMOW J:   I know, but in terms how does section 64 speak to section 47A?

MR McKERRACHER: The fundamental issue in relation to that question is that it excludes the Crown. So any argument in the context raised in response in relation to the effectiveness of section 79 ‑ ‑ ‑

GUMMOW J:   We have decided the Commissioner is not the Crown for this purpose, have we not, because you have sued him separately?

MR McKERRACHER:   Absolutely.  It was clearly not the Crown.  So the Crown cannot be assisted in any sense by section 47A.

GUMMOW J:   Or, to be more precise about it, section 64 talks about States.

MR McKERRACHER:   Yes, but States, of course, has a broader connotation than the Crown.  The two Acts, that is, the Crown Suits Act and 47A of the Limitation Act, are designed to cover the field with State and State‑related bodies, the Crown Suits Act dealing with the Crown and the 47A dealing with other public authorities, but 47A in terms expressly excludes the Crown. So 47A cannot assist the Crown because section 79 can only import State legislation in toto. It cannot change the legislation. It is a central feature of section 79 that the Crown is excluded for the simple reason that it is catered for under the Crown Suits Act.

So to the extent that we are able to understand that argument in response, we see that section 79 is of no assistance at all and that section 64 is directly pertinent in relieving us of the obligation to serve either of the notices. We also, your Honours, rely on our original submissions on what is really a very simple point and that is that ‑ ‑ ‑

GUMMOW J:   But not a special leave point.

MR McKERRACHER:   Well, that is ultimately obviously a matter for this Court to determine.  In our submission, where there is a serious injustice the Court would look at the ‑ ‑ ‑

GUMMOW J:   Anyhow, I think we will hear from Mr Mitchell at this stage, Mr McKerracher.

MR McKERRACHER:   May it please your Honour.

GUMMOW J:   Yes, Mr Mitchell.

MR MITCHELL:   May it please the Court.  The respondents’ submission is that whatever path of reasoning is taken, ultimately the present case necessarily turns on the answer to one factual question.  That question is whether the applicant gave notice in writing to the respondents in relation to its proposed action as soon as reasonably practicable after the cause of action accrued and whether that requirement arises under section 6 of the Crown Suits Act as applied by section 79 of the Judiciary Act or whether the requirement arises under section 47A of the Limitation Act as applied by section 79 and 64 of the Judiciary Act does not affect the critical factual issue on which the case turns or the result of the case.

The supplementary submissions which have been filed by the parties do raise a number of questions as to whether section 64 of the Judiciary Act apply to the proceedings below but, in my submission, ultimately it does not matter because if section ‑ ‑ ‑

GUMMOW J:   Why is that?

MR MITCHELL: That is because if section 64 takes the applicant out of the requirement in section 6 of the Crown Suits Act, it will simply substitute the relevantly identical notice requirements of section 47A of the Limitation Act.  The approach which is to be adopted in that context is exemplified in a short passage in the judgment of Justice Gibbs in Maguire v Simpson.

GUMMOW J:   Just slow down for a minute.

MR MITCHELL:   Certainly.

GUMMOW J:   Let us look at section 47A.  So you say on this hypothesis the requirement of section 6 of the Crown Suits Act is gone, right?

MR MITCHELL:   Yes.

GUMMOW J:   Your opponent has the benefit of section 5, which renders the State liable to an action for money had and received, I guess.  But then you say the preferred position of the Crown Suits Act having gone, you are back in the general realm of 47A in which the State is treated like, what?

MR MITCHELL:   If one assumes that the State is a subject, then if this suit for the recovery of money had been between subject and subject, then we say that section 47A would have applied to the proceedings on two alternative grounds.  One, that the alleged demand for and collection of the taxes was in the execution or intended execution of the Business Franchise Tobacco Act or, if that be wrong ‑ ‑ ‑

HAYNE J:   Who relevantly is the defendant that you are hypothesising?  Assume this action had been constituted, as on one view of events it might be said to be properly constituted, by naming only the State of Western Australia as its defendant, how then ‑ ‑ ‑

MR MITCHELL:   The proceedings would then be constituted as against the defendant who is alleged to have demanded and collected the taxes under what is subsequently found to be an invalid State Act.  So the person who in that position might be the subject has demanded and collected taxes in the execution, or at least the intended execution, of the taxing Act or, alternatively, the demand for and collection of the taxes for the revenue of the State ‑ ‑ ‑

GUMMOW J:   Section 47A cannot really work in an ordinary private law action between subjects, can it?

MR MITCHELL: Well, in my submission, it can so long as the subject is a person other than the Crown who is executing an Act or in the execution or intended execution of some public duty or authority. Because section 47A expressly excludes actions against the Crown from its operation, it cannot be said that section 47A places the Crown in any particular special position that must be taken out of account by reason of section 64.

GUMMOW J:   But the action against the State of Western Australia would simply be for money had and received, would it not?

MR MITCHELL:   That is correct, pleaded on the basis that there was a demand for and a collection of revenue under an invalid State Act.

GUMMOW J:   By the State – acting through its officers obviously, but by the State.

MR MITCHELL: Yes, by the State. One response to that might be that the collection of revenue in that matter was a function peculiar to the State, so that section 64 did not apply at all to the proceedings.

GUMMOW J:   Well, I understand there is an argument about that, yes.

MR MITCHELL:   If that were correct, you would not ever get out of section 6 of the Crown Suits Act though.

GUMMOW J:   Yes, that is right.  I understand that debate.

MR MITCHELL: Yes, but assuming, as I assume for the purposes of these submissions, that section 64 does apply, the question then is, what is the Limitation Act provision which would have applied as between subject and subject ‑ ‑ ‑

GUMMOW J:   No. The question is, what does section 79 of the Judiciary Act pick up, is it not?

MR MITCHELL:   Yes.

GUMMOW J:   You say it picks up 47A ‑ ‑ ‑

MR MITCHELL:   We say it picks up 47A but with its meaning unchanged, so that it does not by 79 apply to this action.

GUMMOW J:   As an answer to the action against the State for money had and received – that is what I am trying to get at. You say section 79 picks up 47A unchanged and applies it unchanged to an action for money had and received against the State of Western Australia.

MR MITCHELL: Yes, and that section 64 ‑ ‑ ‑

GUMMOW J:   It does not seem to do that on its face, does it?  Forget about 64 at the moment.  How would 47A on its face apply to any action against the State for money had and received?  You may be right, but that appears to me the question.

MR MITCHELL:   One has to step back one step and say that one is hypothesising about an action between subject and subject and what would the limitation period be in that ‑ ‑ ‑

GUMMOW J:   Well, that is section 64 language.

MR MITCHELL: Yes. So section 64 leads. Now, in action between subject and subjection, we say that section 79 would then pick up section 47A. If I can take your Honours to a short passage of Justice Gibbs in Maguire v Simpson (1977) 139 CLR 362. His Honour perhaps put it better than I have been. In the applicant’s materials at tab 1 ‑ ‑ ‑

GUMMOW J:   Which page?

MR MITCHELL:   Page 276.  At about point 7 on the page his Honour notes that:

Section 79 therefore has nothing to say on the question whether a State statute which is to be applied by a court exercising federal jurisdiction becomes binding on the Commonwealth. In the present case if the Limitation Act does not of its own force bind the Bank, s 79 does not give its provisions an extended operation which would render them binding upon the Bank.

The provisions of section 64 are then set out. His Honour continues:

The words of this section, naturally construed, appear to have the effect that if the Commonwealth is a party to proceedings its rights, and the rights of all other parties to the proceedings, will be governed by any statute of limitations that would be applicable if both parties were subjects.

Other judgments in the Court in that case are to similar effect. So one has to hypothesise what would be the statute of limitation that would apply in this action for moneys had and received if it were an action against a subject. We say that in those circumstances, section 47A would be picked up by section 79 of the Judiciary Act and would apply in those proceedings.  Therefore, in this case, if the rights of the parties are to be treated as nearly as possible the same as between subject and subject, then the requirements of section 47A would be applied.

GUMMOW J:   But that is construing section 64 as, as it were, making citizens worse off, is it not? Not the Commonwealth and the State worse off, if I can put it that way. It turns it around.

MR MITCHELL: Your Honour, in my submission, if the applicant in this case wants to take the benefit of section 64, then it must also assume its burden. That is, here the applicant says that the rights that are to be determined in the suit “as in a suit between subject and subject”. So that section 6 of the Crowns Suit Act must be left out of account because it applies only to the Crown. Now, in my submission, they cannot in the same breath say that section 47A, the provision that would have applied in a suit between subject and subject, must be left out of account because it does not apply to the Crown and section 64 then does not pick that up.

So, in my submission, it is the applicant who are wanting to avoid one limitation period but, as the decision in Maguire v Simpson and, I think, also Commonwealth v Mewett indicate, if one is to do that, one simply does not disapply a limitation provision, one applies the provision that would have applied in an action between subject and subject, and because the requirement for notice is relevantly identical in each of section 47A and section 6 of the Crown Suits Act, the question remains the same and the ultimate question, for reasons which we have set out in our written submissions, is not open to any significant doubt and is not a matter of any significant general importance.

HAYNE J:   Now, 47A carries within it its own extension and leave provisions.  On the argument you have just been advancing, would those provisions also be enlivened?

MR MITCHELL:   They would.  The same provisions also appear in section 6 of the Crown Suits Act.  The difficulty which faces the applicant in this case is that there is a line of Western Australian decisions in the Supreme Court that say that the leave referred to in those sections must be sought before the action is commenced, so that one cannot seek leave retrospectively once the action has been commenced.

When the applicant first served the purported notice on the respondents on 15 April 1998, there was still time for them to seek that leave, but they were promptly informed that the notice was defective because it was not given as soon as practical after the cause of action accrued and for their own reasons they decided not to seek that leave when there was still time to do so.  Of course, those were questions which were considered by the Full Court in its judgment.  The Full Court considered both the potential application of section 6 of the Crown Suits Act and section 47A of the Limitation Act.  While they, in the end, came down saying that this was a matter governed by section 6 of the Crown Suits Act, they also concluded that to the extent that section 47A might have been applicable, its requirements had not been satisfied and that that would be a sufficient ground for the grant of summary judgment.

HAYNE J:   Is an action for money had and received capable of being described as an action for an act done in intended execution of a public duty or authority?

MR MITCHELL:   Yes, your Honour, in my submission, on the basis so long as the person received the money in the execution or intended execution of an Act or received the money engaging in conduct which amounted to the execution or intended execution of a public duty or authority.  That may be a distinction between, for example, the position of this applicant in the Roxborough litigation, where it was not purporting to collect money for the purposes of the revenue of the State, or at least it did not assert that it was; it was simply collecting an amount for its own commercial purposes so as to enable it to satisfy a liability.

GUMMOW J:   Do you know of any other States, Mr Mitchell, that still have provisions like 47A?

MR MITCHELL:   I understood at the time this case was argued it was only South Australia and Western Australia.

GUMMOW J:   I thought so.

MR MITCHELL:   I believe that the South Australian provisions have been repealed.  I understand that the Western Australian provisions are currently under review but there is no result of that review at this point.  So that these provisions are unique at the present, as I understand it, to Western Australia.

HAYNE J:   Their common application is wrongful arrest cases, I take it?

GUMMOW J:   Tort cases.

MR MITCHELL:   No, your Honour, they have a broad range of application, tort being one of them, contracts ‑ ‑ ‑

HAYNE J:   Yes.  I was not giving an exclusive identification.

MR MITCHELL:   No.  Probably the central area of their application is in tort cases where one might be concerned that public authorities – or the justification for the section when it was enacted was that record keeping by public authorities and the like ought be facilitated by a provision which required action to be given be done within a year and notice given as soon as practicable.

GUMMOW J:   Now, in Maguire v Simpson the bank was saying it could sue at any time, was it not?

MR MITCHELL:   That is correct.

GUMMOW J:   The hapless customer was saying, “What about the statute of limitations?”

MR MITCHELL:   Yes.  The case proceeded on the basis that, notwithstanding provisions of that Limitation Act which purported to bind the Crown, the Crown in right of the Commonwealth could not be bound by that Limitation Act provision. The Court said that what section 64 requires is that one substitutes the limitation provision that would apply in an action between subject and subject and, therefore, it is no answer to say that the particular provision ‑ ‑ ‑

GUMMOW J:   Therefore, the Commonwealth lost its preferred position by virtue of section 64.

MR MITCHELL: But section 64 does not talk about a preferred position. It simply says that the rights will be the same as far as possible as in action “between subject and subject”. That may, potentially in this case ‑ ‑ ‑

GUMMOW J:   It has not generally been seen as a section which makes the citizen worse off and advantages the Crown, whether the State or the Commonwealth.

MR MITCHELL:   Well, in this case it does not make the citizen worse off.  It simply does not make them any better off because the Limitation Act provision that would apply in a suit between subject and subject has the same requirement as the special limitation provision that applies especially to the Crown. In my submission, one should await a case where questions as to whether or not section 64 does apply actually makes a difference to the outcome of the case and, in my submission, this is not an appropriate vehicle for the grant of special leave for reasons concerned with section 64 because the ultimate factual question and answer in this case must be the same. If it please the Court, those are my submissions.

GUMMOW J:   Now, if the case were to go ahead, what would the State defences be?  Would you indicate that?  Would there be Mason v New South Wales‑type defences?

MR MITCHELL:   There may be.  We would also rely on a statutory passing‑off defence, or passing‑on defence.

GUMMOW J:   Yes.  That is in all the States now, is it?

MR MITCHELL:   I am not sure about that.  It certainly exists in section 37B of our Limitation Act.

GUMMOW J:   Yes.  But it was introduced three or four years ago, was it not or a bit more?

MR MITCHELL:   Yes, it was.  I think it was May or June 1997.

GUMMOW J:   Yes, that is the statute.  Thank you.  Yes, there will be a grant of leave in this matter.  I take it it will be a one‑day case, even allowing for the possibilities of some succinct interventions.

AT 1.33 PM THE MATTER WAS CONCLUDED