Solomons v District Court of NSW
[2002] HCATrans 151
IN THE HIGH COURT OF AUSTRALIA
Office of the Registry
Sydney No S150 of 2001
B e t w e e n -
CECIL GREGORY SOLOMONS
Appellant
and
DISTRICT COURT OF NEW SOUTH WALES
First Respondent
STATE OF NEW SOUTH WALES
Second Respondent
THE QUEEN
Third Respondent
GLEESON CJ
GAUDRON J
McHUGH J
GUMMOW J
KIRBY J
HAYNE J
CALLINAN J
TRANSCRIPT OF PROCEEDINGS
AT CANBERRA ON TUESDAY, 30 APRIL 2002, AT 10.20 AM
(Continued from 12/12/01)
Copyright in the High Court of Australia
__________________
MR J. BASTEN, QC: If the Court pleases, I appear with MS M.N. ALLARS for the appellant in this matter. (instructed by John Bettens & Co)
MR M.G. SEXTON, SC, Solicitor‑General for the State of New South Wales: If the Court pleases, I appear with my learned friends, MR M.J. LEEMING and MS B.K. BAKER, for the second respondent. (instructed by the Crown Solicitor for the State of New South Wales)
MR S.J. GAGELER, SC: If the Court pleases, I appear for the third respondent. (instructed by the Director of Public Prosecutions (Commonwealth))
MR D.M.J. BENNETT, QC, Solicitor‑General of the Commonwealth: If the Court pleases, I appear with my learned friend, MR R.G. McHUGH, for the Attorney‑General of the Commonwealth intervening. (instructed by the Australian Government Solicitor)
MR P.A. KEANE, QC, Solicitor‑General for the State of Queensland: May it please the Court, I appear with MR G.R. COOPER for the Attorney‑General for the State of Queensland, intervening in support of the interests of the second respondent. (instructed by the Crown Solicitor for the State of Queensland)
MR R.J. MEADOWS, QC, Solicitor‑General for the State of Western Australia: May it please the Court, I appear with my learned friend, MS J.C. PRITCHARD, on behalf of the Attorney‑General for Western Australia, intervening in support of the second respondent. (instructed by the Crown Solicitor for the State of Western Australia)
MR B.M. SELWAY, QC, Solicitor‑General for the State of South Australia: If it please the Court, I appear with my learned friend, MR C.D. BLEBY, for the Attorney‑General for South Australia, intervening in support of the second respondent. (instructed by the Crown Solicitor for the State of South Australia)
GLEESON CJ: There is a certificate from the Deputy Registrar that she has been informed by the solicitor for the first respondent that the first respondent does not wish to be represented at the hearing of the matter and will submit to the orders of the Court save as to costs. Yes, Mr Basten.
MR BASTEN: Your Honours, may I note in opening that our written submissions of 12 April were intended to be the full statement of our argument rather than being supplementary to the earlier submissions and therefore replace them. Might I also note in passing, although I think it has no bearing on the appeal, that in the updated legislation which is contained at the back of our bundle of submissions, we omitted the Courts Legislation Amendment Act 2001 No 85, which was passed earlier this year and which I think the Solicitor for New South Wales has included in his materials.
Your Honours, may I approach this matter by dealing with the issues in three separate items. Firstly, in relation to section 68(2) of the Judiciary Act, we understand there to be in substance two issues arising with respect to the operation of that provision. The first is whether the grant of a certificate under the Costs Act is an exercise of judicial power of the kind which could be vested in a court exercising federal jurisdiction. The second issue is whether the exercise of that State jurisdiction has been exhausted before the power to grant a certificate comes to be exercised, which I might call the temporal argument.
KIRBY J: It is suggested that they should be considered in reverse order, the first being the statutory question, the second a constitutional question.
MR BASTEN: Yes. I intend to come to the section 68 arguments first because they take one first to the terms of the Costs Act, so I will deal with them at the outset so that we address the statutory construction question immediately, your Honour.
The second issue relates to the operation of section 79. In short, if the jurisdiction picked up by section 68 includes dealing with the costs of the proceedings by considering the grant of a certificate under the Costs Act, then it may be necessary to consider whether the Costs Act is not binding on the court in terms of section 79 because it is inapplicable, the argument being that it applies in terms only to State offences.
Thirdly, by way of qualification to the conclusions one reaches in relation to both those matters, if the grant of a certificate is otherwise an exercise of judicial power and capable of being applied in federal jurisdiction, is there an implied constraint which precludes Chapter III empowering the Parliament to confer by legislation an obligation which requires the State to pay costs incurred by a defendant in a Commonwealth prosecution and that we would understand, in substance, to be the Melbourne Corporation point.
GUMMOW J: Now, in your written outline you mention section 39, right on page 1.
MR BASTEN: Yes.
GUMMOW J: Do you rely on that or not? We need to know.
MR BASTEN: Yes, in brief, your Honour, the ‑ ‑ ‑
GUMMOW J: Your opponents need to know.
MR BASTEN: I am sorry?
GUMMOW J: Your opponents need to know.
MR BASTEN: In relation to section 39(2) of the Judiciary Act?
GUMMOW J: Yes.
MR BASTEN: Your Honour, the temporal argument may lead us to a question as to whether, if there is a separate application being considered by the District Court judge, that is a matter involving federal jurisdiction. If there is a separate application being dealt with, we say by way of a response to the argument put against us that that will nevertheless be an exercise of federal jurisdiction and section 39 may, thereby, have operation.
GUMMOW J: That brings me to this question. The application under the Costs Act that was heard by Judge Keleman was made by your client.
MR BASTEN: Yes.
GUMMOW J: Is there anything in the Costs Act other than section 3A which provides for a contradictor?
MR BASTEN: No, your Honour.
GUMMOW J: And, in this case, was there a contradictor?
MR BASTEN: I am not sure ‑ ‑ ‑
GUMMOW J: The first is a question of construction, the second is a question of fact.
MR BASTEN: Yes.
GUMMOW J: I think the answer is there was not a contradictor in this case.
MR BASTEN: I am not sure whether the prosecutor, the Director of Public Prosecutions, played any role in relation to the discussion on the costs certificate, your Honour.
KIRBY J: I think that is the same thing under the Federal Costs Act too, and in a case where I was asked for it I felt awkward about dealing with it in this Court without having somebody to help, especially as the order goes to the Attorney‑General.
MR BASTEN: Yes. The answer to your Honour Justice Gummow’s first question is no, it is nothing else in the Costs Act. The answer to your Honour’s second question is I do not know and, perhaps, I should seek instructions on that.
GUMMOW J: Yes. The prosecution had been conducted by the Commonwealth DPP, had it not?
MR BASTEN: Yes, it has.
GUMMOW J: I do not quite know who Mr Gageler is. He seems to have been joined in the Court of Appeal as the Queen in the right of the Commonwealth.
MR BASTEN: I think he may have been the party in the Court of Appeal, your Honour.
GUMMOW J: Yes. He was not at the application before Judge Keleman.
KIRBY J: But the DPP is there before Judge Kelemen representing, under his statute, the Queen, I think.
MR BASTEN: Yes, and I am instructed he opposed the application for a certificate.
GUMMOW J: We need to know about that.
MR BASTEN: Yes.
GUMMOW J: Precisely.
MR BASTEN: Your Honours, may I then turn, briefly, to the scheme and form in section 2 of the Costs Act and its place in that Act. Section 2 is the only source of power vested in the court under the Act and your Honours are, no doubt, familiar with the terms of it from the submissions. It appears at page ‑ ‑ ‑
GUMMOW J: I am sorry to interrupt you again, Mr Basten. Why it is important is, if you are right about section 39 there is a question about whether there was any federal jurisdiction. There may or may not be depending upon whether there was a contradictor who was the Commonwealth.
MR BASTEN: Yes, can I come to that, your Honour, I understand the significance of that point. I will deal with that very shortly although I will not be able to give your Honour a fuller answer for the moment.
Section 2 provides that “The Court or Judge or” –
in an appropriate case ‑
Justice or Justices in any proceedings relating to any offence, whether punishable summarily or upon indictment, may –
in substance, in this form of the Act, though no longer ‑
after a hearing on the merits –
where the defendant is acquitted ‑
grant to that defendant a certificate under this Act, specifying the matters referred to in section 3.
Section 3, in turn, requires the certificate to reflect two opinions held by the court. These are, in effect, the two jurisdictional facts which condition the grant of a certificate. As we would understand it, the court cannot grant a certificate unless satisfied as to those two facts. The grant of the certificate is itself a precondition to an application under section 4, an application which is made to the Under Secretary, and which triggers the obligations imposed on the Under Secretary in mandatory terms, under section 4(3), to produce a statement specifying the matters set out therein.
The next and, perhaps, the fourth stage, in effect – there is the function exercised by the court; there is the application to be made by the holder of a certificate; there is the action to be taken by the Under Secretary; and, fourthly, in section 4(5), there is the power conferred on the Treasurer to deal with the certificate by making or not making a payment of the whole or part of the costs. The costs would appear to be the amount referred to in the statement prepared by the Under Secretary, which has been provided to the Treasurer.
KIRBY J: Now, you are referring to the Under Secretary. The print which is annexed to your submissions refers to the Director-General, which is the new title of the Under Secretary. What is the time at which the statute attached? In other words, which form of the statute are we dealing with? I am referring to page 52 of your submissions. It is the Director-General, which is the new title of the Secretary of the Attorney-General’s Department, is used throughout.
MR BASTEN: Your Honour, I was taking the Court to page 38, because that was the form in which the Act appeared as at the date of the judgment of Judge Keleman, which was 24 July 1998. The amendments, although made in 1997 and 1998, which had the effect which your Honour refers to, commenced on 3 August 1998 – in other words, 10 days after the judgment of the District Court. That appears at page 61 of the bundle. Your Honours will see that the “Table of Acts” includes, in the fourth and fifth paragraphs, reference to the 1997 and 1998 amendments and the date of commencement.
GLEESON CJ: Mr Glanfield has been called the Director-General for many years before 1997, so there must be some statutory provision that enables you to read “Director-General” for “Under Secretary”, or that enables this description of “Under Secretary” to operate.
MR BASTEN: I am not sure about that, your Honour. Your Honour is no doubt right. I do not know the answer to that.
KIRBY J: So we are to deal with the Act as it appears on page 38?
MR BASTEN: In my submission, yes, your Honour. I do not think that is in dispute. But I do not know the answer to your Honour the Chief Justice’s point. The short conclusion we derive from the scheme and the terms of the Act is that of the four stages which are reflected in it, the court’s function is complete at the end of the first stage. The result of the exercise of power by the court is that the defendant is granted or is refused a certificate which constitutes a statutory right to make an application under section 4.
Your Honours, as we understand it, both the third respondent and the Commonwealth Attorney accept that that function involving the grant of a certificate by the court can fall within the scope of judicial power. Like a costs order, it is an exercise of power with respect to the allocation of the liability for one party’s costs incurred in the proceedings and in accordance with the justice of the case. The purpose is that identified in paragraph 5.6 of our written submissions as articulated by Justice Brennan in Latoudis v Casey, and I need not take your Honours to that material.
May I also note in passing that the history of the costs legislation is referred to in Allerton’s Case noted in 5.12 of the written submissions. I do not know whether your Honours have it, but we handed up on the last occasion a bundle of the statutory material from both England and New South Wales which gave that statutory legislative history.
HAYNE J: Just before you go on, the last stage in the process is, is it not, that contemplated by section 4(6), which is the appropriation provision permitting the payment out?
MR BASTEN: Yes. In effect, that is so, your Honour, because it makes available pursuant to this statute the funds which might be expended under section 4(5), as we would understand it.
HAYNE J: And that is the only parliamentary appropriation? I am not saying it is an insufficient appropriation, but it is the only appropriation that we would find?
MR BASTEN: It appears to be the relevant one, your Honour, yes.
KIRBY J: That is pursuant to a power conferred by the State Constitution.
MR BASTEN: Yes.
KIRBY J: And conferred only on the State Parliament.
MR BASTEN: Yes.
KIRBY J: That is a pretty fundamental principle, is it not, that the electors of the State in the State who elect the Parliament of the State should have the power, if they disagree with the appropriation, to voice their disagreement at election.
MR BASTEN: The inference that I draw from both of your Honours’ comments is that I need to go to that aspect of the matter and I was intending to do so, although in the third stage of the argument.
KIRBY J: As long as it is reached, because it is pretty fundamental.
MR BASTEN: Yes. In brief, your Honour, we say that an appropriation is required by section 45 of the Constitution by legislation. The legislation is based upon the power conferred in section 5 of the State Constitution Act and that in turn is subject to the Constitution of the Commonwealth in terms. So that while we accept all that your Honour has put to us, we will ultimately say that there is no limitation on the Commonwealth constitutional powers to be inferred from the need for an appropriation as such.
HAYNE J: But we are not concerned, are we, with an allocation of the burden of costs as between parties?
MR BASTEN: Not in terms, your Honour, no.
HAYNE J: Well, you say not in terms, are we in any sense?
MR BASTEN: No, and that is not envisaged by the Costs Act itself. The Costs Act is not an Act which deals with costs in criminal cases where the charge has been commenced and maintained by the State or an officer of the State. It applies generally in its terms to State offences, whoever the informant or prosecutor may be. So that in some cases it will inevitably mean that the costs to be dealt with are costs of one party, the defendant, and to be met by another body, the State, which may not be a party to the criminal process before the court.
CALLINAN J: Mr Basten, is there provision in New South Wales legislation for the Attorney-General or the Director of Pubic Prosecutions to take over any prosecution instituted in New South Wales, except perhaps for one under federal law?
MR BASTEN: Yes, I think there is, your Honour. Perhaps I can take that question on notice. I think there is in the Criminal Procedure Act 1986, but it is a power, not an obligation, and it applies, I think, in indictable matters.
CALLINAN J: But it may be relevant in the sense that it gives to the State, as it were, power over all prosecutions except for those under federal law.
MR BASTEN: It may give the State that power, your Honour. I am not sure that it applies to summary offences though where ‑ ‑ ‑
CALLINAN J: In any event, you will find it for me.
MR BASTEN: I will come back to your Honour, if I may.
CALLINAN J: Thank you.
MR BASTEN: The point I was going to make was that the Attorney for the Commonwealth notes in his written submissions, and we respectfully adopt the argument, that orders with respect to costs clearly fall within the judicial power and he refers at paragraph 4.2, especially in footnote 5, to the R v Archdall 41 CLR 128 for authority for that proposition. May I simply add to that reference De Vos v Daly 73 CLR 509 at 515 – I will not take your Honours to it – in which ‑ ‑ ‑
HAYNE J: But do you say that this is an order as to costs or analogous to it?
MR BASTEN: No, it is an order as to the liability for the costs incurred in a proceeding.
HAYNE J: But not as between parties?
MR BASTEN: Not as between parties.
HAYNE J: Well, that is a beast of an unusual kind, is it not?
MR BASTEN: Yes, it is, your Honour. Well, it is a beast of a different kind from a straight costs order in the normal meaning of the term. I start with the proposition in relation to costs orders and then come, if I may, to the next stage of it, but I accept that there is a further stage in the argument. De Vos v Daly I gave your Honours the reference to, which applied Archdall, and for what it is worth perhaps, the same point appears to have been assumed in the judgment in Alexander v Donohoe (1906) 4 CLR 781, where there is a reference arguendo in an extract from the Chief Justice’s comment at 782. The same conclusion is taken to be beyond contrary argument.
The next stage, as your Honour says, concerns the fact that the order is not as between the parties and ‑ ‑ ‑
GLEESON CJ: Would you call it an order?
MR BASTEN: I am sorry, the grant of a certificate. That appears in relation – I should emphasise I am dealing with a question of an exercise of judicial power at this stage – that was the feature which was also relevant in the BLF [No 2] Case 152 CLR 179, to which the Commonwealth Attorney refers, in relation to the Federal Proceedings (Costs) Act 1981, and with respect we adopt the Attorney and the third respondent’s understanding of that case and, in particular, the conclusion that the consideration of a grant of a cost certificate under the Federal Costs Act constitutes an exercise of judicial power.
If I might simply take your Honours to page 182 of the report in order to – perhaps I should start at page 181. Section 6 of the Federal Costs Act is set out in the Chief Justice’s judgment. It involved, in section 6(3):
a certificate stating that, in the opinion of the court, it would be appropriate for the Attorney-General to authorize a payment –
Then in section 16, which is set out in the middle of 182:
A person who has been granted a costs certificate . . . may apply to the Attorney-General for payment –
and 16(2):
the Attorney-General may, having regard to the provisions of section 18 and to the moneys available at the time of the application for making payments under this Act, authorize the payment . . . and a payment so authorized shall be made accordingly.
KIRBY J: Was the word “appropriate” given any meaning? Does it mean any more than it would be just? Or does it take into account large policy questions about the desirability of spending money on this rather than on say representation of litigants at trials and ‑ ‑ ‑
MR BASTEN: Yes. Well, that was a matter which was, in effect, central to the decision in the case because it is obviously put in terms which have a strong flavour of the recommendatory or advisory opinion. The Court unanimously took a different view about it. At page 183 at about point 2, the first full paragraph, the Chief Justice stated:
If s. 16 gives the Attorney-General a discretion whether or not to act on a certificate, the provisions of the Act will be invalid.
So his Honour was concerned with that matter. Then, at the end of that paragraph, he says:
It is not an exercise of judicial power to make a recommendation which a Minister has a discretion to ignore.
That obviously reflects the terms of that Act. However, at the bottom of page 183 it seems, at the end of the last full paragraph on that page, that the test which his Honour was satisfied by was that the Attorney:
has no general discretion to refuse his authorization.
KIRBY J: There are two questions. One is whether, getting towards the certificate, the Act requires a judge to take into account non‑judicial considerations. It seems to be assumed or implied in the decision that that test was passed and that non‑judicial considerations were not taken into account.
MR BASTEN: Yes.
KIRBY J: Then there is the question of whether the discretion is too large, so that it has gone beyond what judges exercising discretions every day, including costs matters, normally do.
MR BASTEN: Yes, and, your Honour ‑ ‑ ‑
KIRBY J: It seems as though both tests were passed, according to the Court.
MR BASTEN: Yes, that is so. The first was passed perhaps because of the limited view that was taken of the exercise of discretion under section 16, which no doubt coloured the exercise of power by the court. It would be unlikely that the court would have a broader discretion in a policy sense than the executive officer of the government.
Your Honours, the point made by the Commonwealth Attorney is that perhaps one needs to be careful in applying too broadly the approach adopted by the Chief Justice. Justice Mason agreed with him in terms at page 184. Justices Murphy and Wilson both had qualifications to the way his Honour approached the matter, in substance stating that the fact that there was some element of discretion was not critical to the case, Justice Murphy noting that an order for mandamus was a judicial order, although it left an administrative officer with a discretion as to how to exercise a power, in the middle of page 184.
Justice Brennan took a different approach. He was satisfied that the scheme of the Act, enabling for costs to be dealt with in this way, was an exercise of judicial power in any event, although there was undoubtedly ‑ ‑ ‑
GUMMOW J: That is not quite right, is it? Look at the bottom of 186.
MR BASTEN: Bottom of 186, your Honour?
GUMMOW J: Yes.
MR BASTEN: Yes, “does not necessarily spell its invalidity”.
GUMMOW J: He says it “is not judicial”.
MR BASTEN: Yes. His Honour said that it was appurtenant to the performance of a principal judicial duty, citing Steele’s Case. It was therefore valid – although, yes, your Honour is correct in the way that he deals with it in a slightly different manner.
The point I was seeking to make and it is one that the Commonwealth Attorney makes, perhaps, more coherently, is that one needs to read the judgment of the Chief Justice with some care particularly in the light of the legislation which his Honour was construing and that, of course, differs significantly from the legislation presently before the Court. The New South Wales Costs Act is not expressed in terms of the court expressing an opinion, it is the court formulating an opinion as to certain factual matters and then granting a certificate stating that such an opinion has been formed so that we would understand that the BLF Case provides authority for the proposition that, although one is going beyond the allocation of costs between the parties, that does not spell constitutional invalidity within federal jurisdiction.
Your Honour, may I come back then, in a sense, to the construction point and what I described as the temporal argument in relation to the operation of section 68. The starting point of that analysis must be with the terms of the State law and whilst it is true that the allocation of liability for costs must follow a decision on the substantive issues in dispute, that liability is itself contingent on the substantive outcome and on other matters which are directly and inherently related to the institution and maintenance of the proceeding. Unlike an appeal, the matter is not dealt with by a different court nor is there any provision in the Costs Act for some separate application or procedure, or for the instituting of fresh proceedings, in order to obtain a certificate.
KIRBY J: Is that quite right? There is, in fact, a separate application. It is not formalised by a process or on the record but, in fact, we all know that what happens is the case is concluded as to the substantive matters and then counsel rises and says, “I ask for a certificate under the Suiters’ Fund Act or the Costs Act” and so it is an application.
GUMMOW J: That is right, is it not? Is there not a decision of the Court of Criminal Appeal saying it need not be made to the same judge?
MR BASTEN: There is, your Honour. With respect, we would doubt the correctness of that decision.
KIRBY J: That was foreshadowed in Allerton is it not, that it is an application to the court?
MR BASTEN: Yes.
KIRBY J: I think the Act talks “to the court”, does it not?
MR BASTEN: Yes. Your Honour, the judgment of Justice Simpson in that case paced some weight upon the fact that ‑ ‑ ‑
GUMMOW J: What happens if the judge drops dead overnight?
KIRBY J: That was pointed out in Allerton.
MR BASTEN: Yes, obviously the judge made ‑ ‑ ‑
GUMMOW J: These things have happened.
MR BASTEN: Of course ‑ or retire, and those are practical consequences which may often disrupt the orderly flow of judicial business – I am sorry, not often, but they may disrupt the outcome.
KIRBY J: Not too often, we hope.
MR BASTEN: No, I apologise, but they may or may not be a satisfactory answer to the question of whether or not the court is intended to be constituted by the judge who heard the proceedings, and there are some indications in the terms of the statute that that it is so, but in any event ‑ ‑ ‑
KIRBY J: Is there a time limit on making the application?
MR BASTEN: No, your Honour. There is no reference to an application; there is thus no reference to a time limit within which the request for the certificate could be made. No doubt the failure to make the request immediately might be a factor to be taken into account but there is no provision in the Act either way.
KIRBY J: I was merely picking up the words “no separate application”. You are entitled to say that in the normal run of cases there is no separate process, you do not take out a separate summons, it is just done on the run at the end of the substantive matter by the same court.
MR BASTEN: Yes. Your Honour says “in the ordinary run” and I, perhaps, take it one stage further and say that the Act itself makes no provision for such an additional formal process and if it did it might constitute an argument against the view which I am putting, namely, that this is part of the power to be exercised in the jurisdiction conferred on the Court with respect to the criminal proceeding.
It is necessary to answer the question in terms of the test in section 68(2) itself, namely, that the jurisdiction of the State court be “with respect to” the trial of the offender. It is not limited in terms to the precise parameters of the trial and the phrase “with respect to” requires that there be a reasonable and discernible link conformably with the policy of the legislation. We say in paragraph 5.45 of the submissions that the appropriate test is that set out in Technical Products and O’Grady’s Cases in this Court and we suggest that the test is satisfied in the present case.
With respect, the temporal argument, if valid, should have prevented the determination of the reference following an acquittal in Mellifont constituting an exercise of judicial power in circumstances where there was far less of a consequence for the rights of the parties than in this particular case, where the grant of a certificate or its refusal is a statutory precondition to the making of a further application.
KIRBY J: In fact, in Mellifont, the legislation provided had no effect on the…..did it not?
MR BASTEN: Indeed. It could not affect the acquittal, and had no more than a remote, practical, possible effect on any future prosecution, if there be such.
Secondly, we say, if the temporal argument has merit, then one has, apparently, a two‑stage process in the exercise of State jurisdiction. But even if the grant of a certificate were, in some way, an exercise of a separate jurisdiction, it is necessary to inquire, so long as it involves judicial power, whether it is an exercise of federal jurisdiction. There are two reasons for thinking that it would be.
The first is that the subject matter of consideration has two federal elements. It involves the costs incurred by a party in resisting a prosecution under Commonwealth law, and, under LNC, to which we refer in our written submissions, and to which I may return. That may be sufficient in itself. Secondly, that which is required to be stated in the certificate and the subject of the opinion formed by the judge, is an assessment – albeit on an hypothetical basis – of the reasonableness of the conduct of a Commonwealth officer in commencing a prosecution under a Commonwealth law.
GUMMOW J: Now, how do you fit that in section 75 or section 76? Which paragraph of 75 or 76?
MR BASTEN: In terms of ‑ ‑ ‑
GUMMOW J: LNC was 76(ii).
MR BASTEN: Yes.
GUMMOW J: How do you fit it in here?
MR BASTEN: In relation to the connection with ‑ ‑ ‑
GUMMOW J: This is assuming that under the Costs Act, as it were, you are starting again; starting something new.
MR BASTEN: That is so, yes. The subject matter in LNC was the entitlement to import under the Customs Act. The subject matter in this case are the costs incurred in a prosecution under the Customs Act. There is obviously no precise identity of subject matters, but they are within the same category. They originate in relation to: one, the immediate exercise of executive power under the Commonwealth statute, which had conferred a right to a quota; the second, under an exercise of federal jurisdiction in a prosecution between the Commonwealth and a party.
GUMMOW J: So it is a matter arising under the Customs Act?
MR BASTEN: Yes.
GUMMOW J: Any other Act?
MR BASTEN: Well, obviously, the operation ‑ ‑ ‑
GUMMOW J: We have to know.
MR BASTEN: I understand that, your Honour. The charge was one which arose under the Customs Act; the prosecution was dealt with in terms pursuant to the powers conferred under the Judiciary Act. That is beyond doubt. So that the costs were incurred in resisting a charge under the Customs Act, being pursued under the Judiciary Act.
GUMMOW J: So it is a matter arising under the Judiciary Act, is it?
MR BASTEN: Both.
GUMMOW J: Well, does it have to be both, or is either sufficient?
MR BASTEN: No. Either is sufficient.
KIRBY J: You refer to the incidental power, a head of constitutional power. Is that relevant here, or not? In other words, it is 75 or 76 plus the constitutional express incidental power. Have I misunderstood your submission?
MR BASTEN: No, your Honour. We would have thought the power to invest, under section 77(iii), in relation to a matter arising under 76(ii), would be itself sufficient. I know there is reference to the incidental power in some of the earlier judgments dealing with section 79. It has not been determined whether it is necessary to go to the incidental power. For the purposes of giving the Commonwealth Parliament the power to make a full investiture in relation to jurisdiction and laws, we would think it would not be necessary in this case, either. It may be, also – as I think Justice McHugh noted in Edensor’s Case – that one can rely upon section 78, too, in relation to the power of the Parliament to make laws:
in respect of matters within the limits of the judicial power.
GUMMOW J: Well, what is the law here? In so far as you are relying on section 78, we have to know what the Commonwealth law is.
MR BASTEN: Yes. The Commonwealth law in relation to this part of the argument would be section 39(2), on the basis that this is no longer an exercise of criminal jurisdiction with respect to a trial under section 68.
GUMMOW J: That becomes circular.
MR BASTEN: Well, that may be so, your Honour. The next point I was going to suggest was that it may be sufficient to invoke federal jurisdiction, but the application in this case was based upon section 79, as appears from Judge Keleman’s judgment.
GUMMOW J: It cannot be based upon section 79. Section 79 assumes federal jurisdiction already exists at some other source. That is what it says.
MR BASTEN: The application for a ‑ ‑ ‑
GUMMOW J: To give some content to the resolution of the matter.
MR BASTEN: Yes. The application for a certificate is a claim or request based upon ‑ ‑ ‑
GUMMOW J: It says, “be binding on all Courts exercising federal jurisdiction”.
MR BASTEN: I am sorry, your Honour. May I just ‑ ‑ ‑
GUMMOW J: You have to go somewhere else before you come to 79.
MR BASTEN: One does.
GUMMOW J: What I am trying to find out is where is the somewhere else? I have the Customs Act, 39(2).
MR BASTEN: I accept that. Section 79 may be otiose. It may be that covering clause 5 does all the work of section 79 in any event once one has federal jurisdiction. In Kable 189 CLR 51, I think in your Honour’s judgment at 136, your Honour noted that it was sufficient that a claim was made based upon a federal law in order for the court to be exercising federal jurisdiction. Your Honour referred to Felton v Mulligan 124 CLR 367.
GUMMOW J: That is what LNC decided.
MR BASTEN: That is so.
GUMMOW J: That is not controversial. We were just trying to define the law.
MR BASTEN: Yes. All I am saying is that at this stage of the argument the federal jurisdiction will not be invested by 68(2) on ‑ ‑ ‑
GUMMOW J: No, your theory is it is 39.
MR BASTEN: Yes, 39(2). But the laws – otherwise my earlier answer to your Honour would have ‑ ‑ ‑
GAUDRON J: Why do you not just say it is 68(2)?
MR BASTEN: This is on the hypothesis that we are now no longer within the jurisdiction with respect to a trial and conviction. Your Honours, the second aspect of the matter – and these are of course interrelated – concerns the term “inapplicable” in section 79 of the Judiciary Act. Perhaps it is convenient to turn to that matter. The Costs Act may be inapplicable and it is said to be because the application in relation to a Commonwealth offence requires an impermissible change in the meaning of section 2 which refers merely to “an offence” which we accept would be read to be “a State offence”.
Because the power is being exercised by a State court, that would appear to be the only relevant change in relation to section 2 of the Costs Act and, as we suggest in the written submissions, Thomas v Ducret 153 CLR 511 is squarely in our favour on that point because, although the Victorian law did not apply in federal jurisdiction in the Federal Court, that was for a different reason. In the passage relied upon, it appears to have been accepted expressly that the fact that it was a Commonwealth offence which was in issue was not fatal to the exercise of federal jurisdiction. That appears in the passage in the joint judgment of the Court at the bottom of page 511 to the top of page 512.
GUMMOW J: In Edensor the Solicitor‑General for the Commonwealth had some criticisms of Thomas v Ducret. We were in fact asked to overrule it, I think.
MR BASTEN: As I understand Edensor – and I may be wrong about this – the criticism was not directed to this aspect of the matter but to the next stage where the Commonwealth Act failed. In other words, in Victoria there was a uniform scheme whereby imprisonment for default of payment of a fine was available in every court but, because of the way in which the State jurisdiction was structured in Victoria, only indictable matters could be dealt with in the Supreme Court and summary matters could not be dealt with in the Supreme Court. So that to the extent that the power was available in a superior court, it was only available in relation to indictable matters, not summary matters. The Federal Court was a superior court and the High Court held that the summary legislative provision did not apply in the Federal Court. It is that aspect, as I understand it, that the Commonwealth says is too narrow.
KIRBY J: You are making assumptions about my knowledge of Thomas v Ducret that are incorrect. I do not carry such matters around in my mind. I have more important things.
MR BASTEN: I am sorry, your Honour, I did it in seeking to answer the question perhaps too briefly.
KIRBY J: If it is important for your argument, just do not assume that I know all of these cases.
MR BASTEN: I apologise. Well, it is important for the argument, your Honour, because Thomas, like Owens, was a question of section 79 having operation in a federal court. Nevertheless, the question arose as to whether the Victorian law, in relation to imprisonment for default, could apply pursuant to section 18A of the Commonwealth Crimes Act, which has terms similar to section 79, in relation to a summary prosecution in the Federal Court. Section 18A is set out at the bottom of page 509 in the judgment of this Court in Thomas 153 CLR 509, and it requires that the laws be applicable, similar to section 79. The provision in relation to the Magistrates’ Court, which was the only Victorian provision having application in relation to summary prosecutions, was limited in terms to the Magistrates’ Court. That appears at the top of 510.
The question was therefore whether section 18A picked up that law so as to empower a Federal Court judge to impose imprisonment in default, and that appears in the statement of principle at about point 4 on page 510, at the end of the first long paragraph. Their Honours say that:
Section 18A is a section similar in intent to s. 79 –
and refer to John Robertson v Ferguson Transformers in two passages which continue to the bottom, effectively, of 511, and then their Honours say, at the bottom of 511:
The laws of a State with respect to the enforcement of fines . . . shall, so far as they are applicable and not inconsistent with the laws of the Commonwealth, apply to an offender who has been convicted in a federal court of an offence against a law of the Commonwealth and ordered to pay a fine, notwithstanding that the State laws are in their terms confined to persons convicted in State courts of offences against the laws of the State. To that extent, and to that extent only, the State laws are given an expanded meaning.
That is sufficient for our purposes, we say, because it deals with the question of the reworking of the State law so that it applies not merely to State offences, but also to Commonwealth offences. May I also suggest that the authority in that respect is consistent with the principle established, and perhaps expressed most clearly in the judgment of Justice Dixon, in Williams v The King [No 2] 50 CLR 551, particularly at page 560. In considering the operation of amendments to section 68(2) with respect to appeals, his Honour identifies a number of principles or steps in his reasoning – his Honour’s judgment commences at page 558 – and in step (5) at page 560 his Honour says:
But when this construction is given to the words of the provision, they necessarily extend to all remedies given by State law which fall within the description “appeals arising . . . This accords with the general policy disclosed by the enactment, namely, to place the administration of the criminal law of the Commonwealth in each State upon the same footing as that of the State and to avoid the establishment of two independent systems of criminal justice.
That is the justification for accepting that a State law applying in relation to State offences picked up by section 79 should be given an operation which extends to its application in relation to a Commonwealth offence.
KIRBY J: It rather begs the question though, does it not, as to whether or not this is part of the criminal law or part of the costs law?
MR BASTEN: Yes. I can only say that in that respect I go back to the question of sections 39 and 68 – I am so sorry, section 79 of the Judiciary Act is not in its terms limited one way or the other, in other words, it will have application whatever the source of federal jurisdiction may be, and it may not be under the Judiciary Act; it may be the Federal Court Act.
GUMMOW J: Just tell me again, what are the elements of this matter arising out of the Customs Act which is invested by 39 and then given content by 79?
MR BASTEN: This is on the separate matter argument?
GUMMOW J: Yes, on the basis that Seaegg indicates that the words “in relation to the trial” cut you off. Just assume that for the moment. So you have to find some other basis – and you say it is section 39.
MR BASTEN: Yes.
GUMMOW J: But what is the matter arising under the Customs Act? What are the elements of that matter?
MR BASTEN: Yes. May I just interpolate that Seaegg, of course, does not say that we are cut off here because it is dealing with an appeal and I was seeking to distinguish the circumstance of an appeal which involves a separate proceeding in a different court, usually.
GUMMOW J: Yes. That argument is going to be developed by others.
MR BASTEN: Yes, indeed. The matter in issue here concerns whether or not a certificate can be granted which has the effect of allowing an application for recompense in relation to a financial burden incurred in defending a prosecution. The prosecution is a federal prosecution for a federal offence under federal law. It is dealt with by a court exercising federal jurisdiction and the costs are, therefore, costs incurred.
GAUDRON J: On that basis, it is a separate matter; it is not part of the criminal trial.
MR BASTEN: That is the hypothesis I am now ‑ ‑ ‑
GAUDRON J: And nothing that was said in BLF really assists you on that hypothesis, does it?
MR BASTEN: What was said in BLF goes to the issue of whether or not the exercise of power is capable of being within federal judicial power.
GAUDRON J: Yes, but what I am really putting to you is, if you see it as, in a general way, associated with the federal matter, namely, the prosecution, then the power to grant a certificate may well be incidental, and so forth and so on, and perhaps not inconsistent with ‑ perhaps you have to add that – and therefore BLF takes you the distance. But once you get into 39(2), it seems to me you have to make the grant of, or the making of, a recommendation by certificate, or the grant of a certificate, itself a matter. You have to find not only something that satisfies the specific requirements of section 39, but you have to turn it into a matter. You have to make it a proper controversy and you have to make it a proper controversy other than by means, it seems to me, that were available for the grant of a certificate as recognised in the BLF Case.
MR BASTEN: Yes.
GUMMOW J: You have to show a right or duty in question, owing its existence to federal law.
MR BASTEN: Yes.
GUMMOW J: What is the right or duty in question in the costs application which owes its existence to federal law?
GAUDRON J: There are really two questions in that. One to identify the right of duty in question and then to slot it into federal law.
MR BASTEN: Yes.
GAUDRON J: I am concerned about the first and I think Justice Gummow about the second.
MR BASTEN: Yes. Can I deal with those points in order? May I, before doing so, come back to what your Honour put to me. This is an argument in defence of an argument put against us. We do not seek to make this our primary position. We adopt what your Honour described as the first position I think, namely that it is truly incidental to the exercise of the criminal jurisdiction. Might I just, for completeness, say in doing that we rely as we do in the written submissions on the analogous analysis of Chief Justice Dixon in Gurnett 95 CLR, in particular at page 112, where his Honour adopts, perhaps at point 2 and following, some of the language which your Honour was putting to me about incidental to, “consequential upon and intimately bound up with the disposition of the appeal” was the language which his Honour used. So that if that is correct then we do not get to this question.
The next matter which your Honour invites attention is what is the right or duty. It is this: the statute, a State statute, provides for a claim to be made for a payment of money. It imposes a statutory precondition, namely the grant of a certificate. Until the applicant has obtained a certificate he is not entitled even to make application for the benefit. His claim is that he is entitled to that certificate. So that is the right which he asserts under section 2 of the Costs Act. The question is then whether it is sufficient for that right to be claimed in federal jurisdiction, if the costs with respect to which the certificate is concerned are costs incurred, and I will not repeat it, but in the federal proceeding relating to the charge under the Customs Act. Now, in LNC the subject matter of the proceeding was a quota. It was a quota conferred on one party under the Customs Act, but the issue before the Court in LNC was whether or not the contract ‑ ‑ ‑
GUMMOW J: The issue was whether the quotas were held on trust.
MR BASTEN: Yes, and it was the terms of the construction of a ‑ ‑ ‑
GUMMOW J: So the subject matter of the trust, namely the quota, owed its existence to the federal law.
MR BASTEN: It did. I accept that. Perhaps your Honours – I think I should just indicate LNC 151 CLR 575. The argument was whether or not the fact that it was concerned with the operation of a contract and perhaps the construction of a trust was within federal jurisdiction. It was argued it was not, but the Court held that it was because, as your Honour says, the subject matter was a right of property which was the creature of federal law, and I do not suggest that this is on all fours with that. The second way ‑ ‑ ‑
GAUDRON J: There was an AD(JR) Act case which I temporarily confuse with that one, as to the meaning arising under an enactment ‑ ‑ ‑
MR BASTEN: That may be Glasson v Parkes Rural Distributions.
GAUDRON J: It went a little distance along the path you are travelling, but I do not think went the full distance that you seek to make.
MR BASTEN: No it did not, your Honour but it was ‑ ‑ ‑
GUMMOW J: It said it did not arise, did it not?
MR BASTEN: It did not rise under an enactment because the scheme was one for payment of petrol subsidies.
GAUDRON J: Yes, that is the one I am thinking of.
MR BASTEN: The Commonwealth provided the money but could not distribute it for constitutional reasons inequitably. The scheme was therefore one that allowed the State and required the State to provide under its law for claims to be made by people who had suffered a loss. The State law in fact empowered a Commonwealth officer to assess the claims, and the claims were then payable out of the moneys provided by the Commonwealth. The question of whether or not the assessment was properly made was a question which arose under State law not under a Commonwealth law.
GAUDRON J: I wonder if you could in due course give me a reference to that case, because it seems to me that is the territory you have to enter under 39(2).
GUMMOW J: It seems to be 155 CLR 234.
MR BASTEN: That is so, your Honour, Glasson v Parkes Rural Distributions Pty Ltd. We accept that the claim which is made as against the Treasurer in this case is a claim made under a State statute. Indeed, we say, at the end of the day, that that is why we do not get into the Melbourne Corporation area, but I can come to that. But the other way in which we put the exercise of federal jurisdiction which attracts section 39(2) is that the claim for the certificate, on one view, can only arise if federal jurisdiction is invoked, because section 2, in its terms, refers only to a State offence. So that unless the appellant is entitled under the Judiciary Act to have the provision applied in federal jurisdiction, he will fail. His claim is therefore that this is a matter which arises in federal jurisdiction. Now, the operation of section ‑ ‑ ‑
GAUDRON J: There may be a real jump in what you are saying there, may there not?
MR BASTEN: Yes, there is, your Honour. It is a bit like section 64, in a way. It is not until you get to court that you know whether you have a claim in federal jurisdiction or not, a paradox which is no longer a paradox, as I think his Honour Justice McHugh said, because the court has ruled on it. In that sense, the exercise by the District Court of its power to determine whether to grant a certificate or not depends on whether or not the Commonwealth law has operation.
Your Honour, I do not think I can take that matter any further. It is, as I said, a subsidiary argument to the primary way in which we put our case, as I indicated to your Honour Justice Gaudron. I am so sorry. Before leaving the question of the operation of section 79, may I just note that Thomas v Ducret on which I have placed some reliance, recently adopted in this Court in Edensor 204 CLR 559 where in the joint judgment at paragraph 75 that passage to which I referred is set out, was not cited in the New South Wales Court of Appeal, so that when the President placed reliance on the need for the appellant to establish that the State law applied in relation to a Commonwealth offence, as he did at paragraph 13 of his Honour’s judgment at page 20 of the appeal book, he did not deal with Thomas v Ducret. He did not, of course, deal with Edensor, because it had not been handed down.
Your Honours, may I then turn to the third stage of the argument, namely, the argument in favour of an implied limitation on Commonwealth power. If the law is binding on the State court, because it is otherwise applicable, it may be necessary to consider an implied limitation precluding a Commonwealth imposition of a financial kind on a State government. That is, as we understand it, the point made against us. But the first step in the argument is to identify the result of the exercise of power by the State court. If it is the grant or refusal of a certificate, and no more, it does not follow that the Commonwealth law has imposed any fiscal obligation on the State. The grant, as we have said, gives the appellant no more, but no less, than a statutory right to make an application to the Under Secretary, and a refusal precludes that right.
KIRBY J: That seems a little unrealistic, given that the whole point of making the application pursuant to the certificate is to get money out of the State coffers.
MR BASTEN: Can I answer it in this way, your Honour. The court which deals with the certificate, having made that decision, has exhausted its function. If the appellant is successful, if the applicant pursues his application with the State, there will then be a separate issue raised, which is whether, if the Treasurer were to refuse the exercise of his power to pay the money, there would be an error of law on his part. It is perhaps possible to test that, if I might, by hypothetically suggesting a second stage to the proceedings, where the appellant has to challenge the refusal of the Treasurer to make a payment. That could only arise in separate proceedings.
GUMMOW J: Well, there is an anterior question, which is: on the assumption that you have your certificate from the court – so 79 is now spent, that stage is past – how does the Treasurer then exercise his powers and discretions under section 4(5)?
KIRBY J: That is what I took you to be saying, that a possibility is that the Treasurer might say, “I’ve got your certificate. I’ve noted it and I’m not going to pay it because it’s an imposition in a federal prosecution upon the State coffers”. But the problem with your reasoning is that it is rather suggesting that the court should overlook the fact that the only point of giving the certificate is to enliven the Treasurer’s obligation, whatever it may be.
MR BASTEN: The question ultimately though, your Honour, is whether the fact that the certificate is a step along a process to making a claim against the State government means that the Commonwealth law which otherwise would permit the certificate to be granted is a law which imposes a fiscal obligation on the State.
GAUDRON J: Does it? That is Justice Gummow’s question. It is all very well for the law to be picked up at the point of the grant of certificate but nothing picks it up so as to extend the charge on the revenue pursuant to which the Treasurer pays out the money.
MR BASTEN: I accept that, your Honour; I rely on it.
GAUDRON J: But what it means at the end of the day is whether he likes it or not, the Treasurer can pay you nothing because the State Act does not operate to allow him to pay out, notwithstanding the certificate.
MR BASTEN: Obviously I depart from your Honour at that level.
GAUDRON J: But you need 79 to operate. You need something to operate, do you not?
MR BASTEN: Yes, I do.
GAUDRON J: And what operates then to make 4(5) applicable or 4(6) applicable? What brings that back in? Section 79 does not.
MR BASTEN: No, but ‑ ‑ ‑
GAUDRON J: If nothing makes it operate, if nothing then gives sections 4(5) and (6) effect with respect to what I will call a federal prosecution, the certificate is an exercise in futility and one would think not likely to attract the exercise of judicial power.
MR BASTEN: I accept the conclusion your Honour comes to by that reasoning. The point of departure is in relation to section 4(2) because it provides that:
Any person to whom a certificate has been granted pursuant to this Act may . . . make application ‑ ‑ ‑
HAYNE J: But the application is in respect of “costs incurred by that person in the proceedings to which the certificate relates”. Ordinarily, absent 79, one would read that as costs in a State prosecution. So far we have 79 working in a way that permits the grant of a certificate. Does 79 in some way amplify the reach of the last part of 4(2), “costs incurred . . . in the proceedings to which the certificate relates”?
MR BASTEN: With respect, that work has already been done, we say, in other ‑ ‑ ‑
HAYNE J: By the certificate?
MR BASTEN: Yes. It has been done by the picking up of section 2, to confer a power under the State Act on the District Court judge. Once he has that power in relation to a prosecution for a Commonwealth offence and can grant a certificate, the certificate relates to the costs incurred in those proceedings inevitably in its terms and it is those costs in relation to which application is made. But the application is conditioned upon that first step having been taken, no more.
GAUDRON J: That is dependent on construing 3A and 4 where it refers to a certificate granted by a judge - under section 2 they seem to be the words that are used – as being a certificate granted under section 79 of the Judiciary Act picking up section 2.
MR BASTEN: Subject to this, your Honour, that as I understand the court’s learning in relation to section 79, it does not create a Commonwealth law when it picks up a State law. In other words, it is still the State Act which has application, albeit by virtue of the Commonwealth law or perhaps covering clause 5, in federal jurisdiction. So that the certificate which is granted is not granted pursuant to section 79 but pursuant to section 2 of the Costs Act, its operation having been extended in a particular respect by section 79.
So that when section 4(2) refers to a certificate “granted pursuant to this Act”, that is still satisfied, that “pursuant to” is still applicable because the judge is only exercising power in relation to section (2), although its application ‑ ‑ ‑
GAUDRON J: That would seem to me to be a crunch question for you, “pursuant to this Act”, when you see it in – because clearly, on your argument, it is not pursuant to this Act to start with; it is pursuant to the Judiciary Act picking up this Act and making it, as it were, a surrogate law.
MR BASTEN: These are difficult terms. “Surrogate law” and so on are terms which have been adopted. May I take the Court to John Robertson v Ferguson Transformers 129 CLR 65. There are a number of passages which ‑ I perhaps should be selective.
GUMMOW J: They do not have to grapple with this sort of problem though, do they? They are dealing with State limitation Acts and so on. They do not deal with the sort of problems that flow on later by the presence of provisions like section 4; flow on later outside the judicial system.
MR BASTEN: No, well that is obviously so, your Honour, I accept that, but the answer to that question may depend upon how section 79 has operated in the relevant respect. I thought John Robertson may have been on the list of authorities, but can I simply indicate which the passages are; I am not sure whether your Honours will have it. At page 83 in 129 CLR in the judgment of Justice Walsh at the top of the page ‑ ‑ ‑
KIRBY J: What is the proposition you are advancing?
MR BASTEN: The proposition, your Honour, is that when section 79 makes a State law applicable in the exercise of federal jurisdiction, the State law remains just that, a State law, and not a Commonwealth law.
HAYNE J: But all this is bound up also with this notion of pick-up unchanged, is it not; and we are speaking in absolutes which contain within them great difficulty.
MR BASTEN: Yes, obviously that is so, your Honour. May I say this before coming to the passage: if one accepts that federal jurisdiction can arise in a wide range of circumstances, and the diversity jurisdiction is often used as the clearest example of a situation where a State court may exercise federal jurisdiction without knowing it, the fact that somebody resident in another State makes a claim against a person in the home State, the law which the Supreme Court of New South Wales applies when the Queenslander sues the New South Wales person, is not Commonwealth law, it is the State law whatever it may be, and the fact that it is applicable by virtue of section 79, because the court is exercising federal jurisdiction, does not make that law a Commonwealth Act passed by the Commonwealth Parliament; it leaves it as State law. That, with respect, is what Justice Walsh was saying at page 83, I think, in John Robertson. He starts with the proposition to which your Honour Justice Hayne referred. One picks up State laws with their meanings unchanged, Pedersen ‑ ‑ ‑
GUMMOW J: Well there is this assumed dichotomy between meaning and operation.
MR BASTEN: Yes, and then says, the extend of the operation is changed.
GUMMOW J: I do not understand it frankly; I have never understood it.
MR BASTEN: Well, may I just go ‑ ‑ ‑
HAYNE J: Good luck, Mr Basten.
MR BASTEN: Thank you, your Honour; I obviously need more than that. His Honour says:
If a State law imposes a time ‑ ‑ ‑
GUMMOW J: There are linguistic, semantic and philosophical assumptions bound up in all of that.
MR BASTEN: Your Honour, the answer to that may be what I was putting before, namely, that at the end of the day we have a unified legal system and pursuant to covering clause 5 one might have thought that a State law would bind a court exercising federal jurisdiction without the need for section 79 and the precise terminology which it adopts, and this ‑ ‑ ‑
GUMMOW J: That is just not right.
KIRBY J: After all, the States have their own Parliaments, they make their own laws for themselves and making claims on their consolidated revenue is quite a serious thing.
MR BASTEN: Can I come back to that aspect of it, your Honour, because ‑ ‑ ‑
KIRBY J: It is all bound up. Anyway, you come back to that later and promise me you will.
MR BASTEN: I promised you and I will keep my promise.
KIRBY J: Waiting, waiting, patiently.
GUMMOW J: How would covering clause 5 help anyway?
MR BASTEN: Because it would render – I think it is in not dissimilar terms to section 34 of the ‑ ‑ ‑
GUMMOW J: It is the other way around.
MR BASTEN: I am sorry?
GUMMOW J: Covering clause 5 is directed downwards, not upwards.
MR BASTEN: Yes, it refers to the laws of the Commonwealth.
GUMMOW J: I think we had better march covering clause 5 off, Mr Basten.
KIRBY J: It begs the question because it requires obedience to the laws. The question is what the laws are and one of the fundamentals in the Constitution is responsible government.
MR BASTEN: Yes, I accept that, and I withdraw what I said about that. Can I come back to section 79. I mean, we have section 79 and it is necessary to apply it, but what this Court has said in applying it is that – and I am about point 3 on page 83:
the law of the State operates in the same way in whichever court the action comes on to be heard and whether the court hearing it is exercising federal or State jurisdiction. But in accordance with the terms of s. 79 itself, State laws are binding on the court exercising federal jurisdiction –
and so on. So that I merely seek to say that it is the State law which remains the operative law and the terminology which is used is similar in Justice Mason’s judgment at page 95 at about point 3 where his Honour talks of the State laws applying in federal jurisdiction. There is similar terminology, I think, in other judgments in the Court, and similar terminology, indeed, in ‑ ‑ ‑
GUMMOW J: Yes, but look at what Sir Anthony Mason says at about point 3 on page 95:
This purpose would fail partly in its objective if State laws . . . are to be given a literal application under s. 79 –
MR BASTEN: Yes, indeed.
GUMMOW J: And so on. So their meaning is changed, at least their literal meaning is changed. There is some meaning other than literal, perhaps.
MR BASTEN: The question may be the extent to which it has changed and one changes it no more than is necessary for the purposes of giving effect to the federal Act. May I give an example of that. Can I come back to answering Justice Kirby’s question, because in my hypothetical proceeding where the decision of the Treasurer not to pay is challenged, the argument which the appellant would put up is that the Treasurer has taken into account an irrelevant circumstance, namely, the identity of the person who instituted and maintained the prosecution. The reason why that is irrelevant is because the State law, the Costs Act, is drafted without reference to the identity of the prosecutor.
KIRBY J: Yes, but it is drafted in a State context by a State Parliament for State purposes, burdening the consolidated revenue pursuant to the State Constitution from State coffers. A king’s head was cut off and another was banished from the kingdom because of these issues, of making the executive accountable to the legislature.
MR BASTEN: We are much more civilised in New South Wales, your Honour.
KIRBY J: But only because of those revolutions. I mean these are absolutely fundamental in our liberties, that if you raise money you must be accountable in Parliament.
MR BASTEN: And one undoubtedly is, your Honour. That argument would extend to the expenditure of the State’s moneys on the salary of Judge Keleman for the two weeks, or however long he took to hear this matter, in the exercise of a jurisdiction which had nothing to do with the State. If the Constitution imposes an obligation on the State to meet that expense then the Constitution requires that result. Nobody’s head will ‑ ‑ ‑
KIRBY J: Yes, but it is levying the revenue. It ought to be levying the federal revenue. I am very sympathetic to your client. Very sympathetic. It is appalling that there is not such a provision in federal law. Appalling. A counterpart. What you are seeking to do is to as it were use 79 to burden the revenue of the wrong polity It is a very serious thing you are seeking to do, as far as I am concerned.
CALLINAN J: There is another aspect too, Mr Basten. Section 3 of the Costs Act looks at fault, questions of fault, in effect, or questions of responsibility. Now, whether the State has enacted or not provisions to take over any prosecutions other than Commonwealth prosecutions, it undoubtedly has power to do so, whereas it does not have any such power and therefore any such control over federal prosecutions.
MR BASTEN: That may be so, your Honour. The point I was seeking to make was that the Costs Act does not depend upon who is prosecuting, in a more general sense than that.
CALLINAN J: I understand your argument, but I do not think you can leave these other matters that Justice Kirby referred to, and I just referred to, out of account.
MR BASTEN: I am trying to reach them, your Honour. I accept that one does need to take them into account. Part of the answer is that the Act expressly envisages that others may be responsible. Indeed, when one goes to section 4(3)(b) it is clear that the Under Secretary is entitled to expect that some of these costs may be recoverable from some third party and that the State’s liability may properly be reduced accordingly.
HAYNE J: As would ordinarily be the case in a summary prosecution.
MR BASTEN: That is so. That is supportive of the fact that the identity of the prosecutor is not a key consideration which is entitled to be taken into account by the Treasurer in making his decision. Might I say this: the argument may be wrong. All I am saying really is that whether the Treasurer is entitled to take it into account or not, is a question which arises at a separate stage. May I try and test the matter ‑ ‑ ‑
KIRBY J: Except if you take the view, as Justice Gaudron put it, that it is an exercise in futility that the Treasurer is clearly entitled to take into account the levying of the consolidated revenue, that he or she will take that into account quite properly and that, therefore, the granting of a certificate is futile. That judges exercising federal jurisdiction or judges exercising State jurisdiction should not be engaged in futile certificate ‑ ‑ ‑
MR BASTEN: Even arguing against what I just put, that the Treasurer is entitled to take that into account, that is a matter for determination by the Treasurer. It is not a ‑ ‑ ‑
GAUDRON J: My point is not that he can take it into account. My point is that unless you can make something – unless you can make 79 do the extra work or something else do the work, he cannot pay. I am assuming the Treasurer is a “he”. He cannot pay, because he can only pay pursuant to statutory authority.
GLEESON CJ: It is section 4(5) and 4(6) that say “open sesame”.
GAUDRON J: Yes. He has no authority to pay except by this Act. Unless you treat section 4(2), unless you treat the words “pursuant to this Act” as meaning pursuant to this Act as given operation in matters of federal jurisdiction by section 79 of the Judiciary Act 1904 he cannot pay. He has no power at all to pay, unless you do that.
MR BASTEN: Yes, and that is the point at which the President in the court below suggested that one had to take a liberal approach to these provisions, otherwise, as he said, the Suitors’ Fund Act would not apply in any proceeding in federal jurisdiction until it had been picked up and applied by a federal law, or the State had made other arrangement, and his Honour suggested that was not necessary, for the reasons which he gave. It is a similar argument – his Honour was against us on one point, but not in relation to this analysis. As I read his Honour’s judgment, he would have accepted that the certificate was granted pursuant to this Act, and therefore was a certificate of the kind which triggered a discretion on the part of the Treasurer.
Now, the question of whether or not the Treasurer has power to refuse is a question as to the extent of his discretion, and that is a question which comes back, perhaps, to the analysis in the BLF Case, if one looks at it as a matter of discretion. Can I put this final point in relation to the way in which we would understand this operating. If the State law had provided for a certificate to be granted in circumstances where there was an unsuccessful prosecution, in the circumstances identified in section 3(1), for an offence prosecuted by the State or by a State authority only, then it is clearly arguable that section 79 would not pick that law up and make it applicable in a Commonwealth prosecution. But that is not this law.
This law says nothing about the identity of the prosecutor, and the Commonwealth is in no different position from a private person, for this purpose, if the private person was an informant in Queensland. With respect, we do not see that there is a difficulty in saying that if section 2 has application by virtue of section 79, one has a valuable consequence, namely ‑ one might have ‑ the grant of a certificate, and what follows thereafter depends upon the construction of the State law in its own terms.
McHUGH J: You keep referring to State law. The accepted doctrine has always been that the State law is applied by force of Commonwealth law and not of its own force as a State law. McGuire v Simpson holds that. So your argument has to be that the Costs in Criminal Cases, sections 2, 4 and 5, which includes a power of subrogation, applies not by force of State law but by force of Commonwealth law, and that the power to make payments under section 4 and the right of subrogation under section 5 operates by force of Commonwealth law. It does not apply by State law. If this Act applies, the whole of the Act applies, and every part of it is being enforced by force of Commonwealth law, not by force of State law.
MR BASTEN: I understand what your Honour is putting to me. My response is partly that one needs to take the Act in its separate parts in order to achieve the ultimate result, because Judge Keleman has no interest in anything beyond the exercise of his function under section 2. What happens thereafter is not an exercise of any jurisdiction that he has conferred upon him by any Act, Commonwealth or State, so that if he is entitled to issue a certificate, and if the certificate issued under section 2 is indeed a certificate for the purposes of section 4(2), then the operation of section 4(2) will be independent of – beyond the fact that there is a certificate ‑ ‑ ‑
McHUGH J: That may well be so, but ‑ ‑ ‑
MR BASTEN: ‑ ‑ ‑ what happened before.
McHUGH J: ‑ ‑ ‑ it does seem to me to create enormous difficulties, because you then have to say that sections 4 and 5, operating as Commonwealth law, by force of Commonwealth law, can bind the Under Secretary and confer rights on him, and that it all comes through section 79.
MR BASTEN: Well, I do not think I accept that I need to go so far in relation to ‑ ‑ ‑
McHUGH J: Well, if the Auditor-General says in a case like this, “Where did you get your authority to make this payment?”, the Under Secretary or the Director-General now would say, “I rely on State law.” Surely the Auditor‑General would say, “Well. the State law does not authorise that payment and what right has the Commonwealth got to authorise you to make this payment or to bring this action for subrogation?”
MR BASTEN: Ignoring the fact that the Commonwealth might have power to do directly what it would be doing indirectly under section 78, there is, nevertheless, a question as to whether it is correct to say that it is the Commonwealth which is authorising the operation of section 4 generally, because the Treasurer’s response may be simply, “This certificate issued by a judge, not set aside by judicial process, is a valid certificate and it triggers my powers under section 4(5) and I must consider it and I must deal with it appropriately according to my law, the State Costs Act, and that I am not dependent on Commonwealth authority nor am I obliged by Commonwealth law to do anything.”
HAYNE J: Do you therefore depend for your argument upon the proposition that sections 4 and 5 are to be understood as applying or engaged by any issue of a certificate?
MR BASTEN: Yes.
HAYNE J: And that the appropriation made in 4(6) is an appropriation of funds to satisfy any certificate however or whenever issued?
MR BASTEN: Yes, your Honour.
HAYNE J: What then do you do with 4(2) pursuant to this Act, 4(3) after receiving an application under subsection (2) and the like?
MR BASTEN: I suppose I say no more than what I was putting before really, that it is still the State law which, for this purpose, is operating. It may be that the authority imposed on the judge to act in accordance with section 2 must ultimately be found in a Commonwealth law, but it is still the State Costs Act which he is applying and to which section 4(2) refers when it says a certificate granted pursuant to the Act.
McHUGH J: But this is a novel approach to section 79 though, is it not, Mr Basten, because these State laws in this context, picked up by 79, have always been treated, have they not, in the same way as an award of the Commonwealth Conciliation and Arbitration Commission? They are, in effect, a datum or a factum which gives content to the federal law. They give specific content to section 79. It is as if, in each case, there was written after section 79, the words of the Costs in Criminal Cases Act or the Limitation Act or whatever the provision was.
MR BASTEN: I think my response, your Honour, is that obviously ‑ ‑ ‑
McHUGH J: Your response is, no, they can continue as State law, and that is because you seize on statements that they continue with their meaning unchanged, but their operation certainly changes, as a case like Evans Deakin shows, for example. To some extent it depends upon section 64, but also section 79.
MR BASTEN: Yes, but one may come back to this, your Honour, that if, in fact, one is saying that the State law has its operation by virtue of section 79, it must only be so much of the State law as properly constitutes part of the federal jurisdiction, the exercise of federal judicial power, which can properly be picked up. So that if I were to submit that section 4 was picked up by 79, in these proceedings the argument must fail. I mean, it may be a Bass v Permanent Trustee type case, the Legal Aid Act. It only arises when one seeks to enforce a liability otherwise imposed by a court that ones needs to deal with these questions. But the question in relation to Judge Keleman’s exercise of power ends with section 2. Your Honour, there may be a separate issue as to whether, if one were seeking to enforce against the Treasurer the law properly understood, because it may be said that he has failed to exercise his power, whether in that ‑ ‑ ‑
McHUGH J: Well, you can test it this way: supposing you want to challenge the exercise of the discretion and you brought proceedings upon the refusal to issue a certificate, would that be a matter in federal jurisdiction or State jurisdiction? You have to say it is in State jurisdiction.
MR BASTEN: I am not sure that I do have to, your Honour. I accept that it is a separate argument, but I only have to say that if there is some limitation on the power of the Commonwealth to render the State liable for costs incurred in the course of federal jurisdiction. The point, I suppose, as a second limb to our bow is that one does not find that limitation in Chapter III. Section 77(iii) expressly denies that there can be a limitation so far as it applies. Section 78 is inconsistent with any such limitation. So that there is no application that we are aware of, of Melbourne Corporation, in a Chapter III case. My friends therefore seek to go back to things like section 106 as a means of protecting the State Constitution, but that is subject to the Commonwealth Constitution as it otherwise provides. We simply say we never get to this question of some lack of power on the part of the Commonwealth to deal with the costs incurred in the federal jurisdiction.
GAUDRON J: Unless it is involved in the question of “matter” or “judicial power”.
MR BASTEN: Undoubtedly, your Honour, yes.
GAUDRON J: You conceded at least to me, did you not, that if there is no power in the Treasurer to pay the moneys in relation to a federal prosecution, then the exercise of granting a certificate is an exercise in futility and forms no part of judicial power? I thought you conceded that much.
MR BASTEN: I concede that, your Honour. There was no power in the Treasurer to pay on the certificate. But the point I was seeking to make to Justice McHugh was in relation to the operation of section 4 on the assumption that ‑ ‑ ‑
GAUDRON J: It seems to me that if your concession to me is correct, then it very much is a question of working out whether there is any power in the Treasurer to pay. That may involve the question whether there is power in the Commonwealth to compel him to pay. If there is no power in the Commonwealth to compel him to pay, it seems unlikely that there is power to bring it about indirectly through section 79 of the Judiciary Act and if section 79 of the Judiciary Act or any other provision which as yet remains unidentified does not have that effect, then he cannot pay. So it all comes back whether you subsume it under “matter” or “judicial power”, it seems to me.
MR BASTEN: Your Honour, that may be so, but one tests it perhaps by reference to the hypothetical proceedings we were considering. If the appellant brings an action against the Treasurer, having got a certificate, to seek to enforce payment, then there is a question as to whether or not the court dealing with that matter is dealing with an exercise of State or federal jurisdiction. The proceedings would no doubt be brought under section 69 of the Supreme Court Act, the judicial review of the Treasurer’s decision. If in relation to my earlier argument about LNC in its operation it were said that the certificate is a certificate granted under federal law and therefore the creation of federal law and one is therefore in federal jurisdiction, then one has an exercise of federal jurisdiction in the second stage proceedings.
GAUDRON J: Picking up section 4.
MR BASTEN: Section 4, that is right. If I am wrong about that, then the certificate and the appropriate dealing with the certificate is purely a matter of State jurisdiction. Dealing with the first possibility, if the certificate being issued in federal jurisdiction gives those proceedings against the Treasurer a flavour which creates federal jurisdiction, then we would respectfully suggest that section 79 will pick up and apply in those proceedings section 4.
That is the crunch issue, I suppose, because one then has to find some implied constraint or express constraint in Chapter III or elsewhere in the Constitution which prevents the Commonwealth, by picking up State laws in the exercise of federal jurisdiction, having the indirect effect of imposing a burden on the State Treasury.
GAUDRON J: That takes you to Evans Deakin though, does it not? It is precisely that operation in relation to section 64 of the Judiciary Act that has caused some consternation and, perhaps, even disbelief.
MR BASTEN: Yes.
GAUDRON J: To give section 79 the same super‑layered operation, because you have really got to do it at various levels to bring it apart, would really be extraordinary, would it not?
MR BASTEN: It would be consistent, your Honour.
GAUDRON J: With Evans Deakin?
MR BASTEN: Yes. It would be consistent with the source of constitutional power relied upon in Maguire v Evans Deakin. Perhaps I should put it ‑ ‑ ‑
GUMMOW J: I would have though Evans Deakin was one of Justice Callinan’s great achievements.
MR BASTEN: It overruled a failure I had in the New South Wales Court of Appeal.
GAUDRON J: It is a little but different from Evans Deakin. In a sense it is the same but section 64 is subjecting the Commonwealth to a risk or a hazard, if you like, that it cannot know about until the proceedings are under way. What you are attempting to do is to subject the States to a risk, via Commonwealth law, that it could not appreciate until the second stage of proceedings were under way and while there is, undoubtedly, power in the Commonwealth to subject itself to risks of that kind one has go to find the power to do it in respect of the States, I should have thought.
MR BASTEN: Your Honour, might I say two things in response. One is that the analysis of section 64 to which your Honour refers was considered by the Court in Austral Pacific 203 CLR 136, and I think it is in Justice McHugh’s judgment there that he notes the apparent paradox in the way in which the section has been applied and says that it is not a paradox because the Court says it is not. Nobody is seeking, as I understand it, to re‑open that reasoning.
GAUDRON J: No, but you are attempting to extend it, really, through section 79 and as against a State about which the States, really, could do nothing. If the Commonwealth does not like the Evans Deakin result it can always legislate. The Constitution does not impose that risk on the Commonwealth, it is section 64 that does it.
MR BASTEN: Yes.
GAUDRON J: But here you are saying you must, ultimately, come to the view, come to the proposition that the Commonwealth has power to expose a State to a risk of that kind.
MR BASTEN: Except, your Honour, that by reliance upon section 79 the Commonwealth is doing nothing that the State, as it were, does not allow, because, as I suggested before, all New South Wales has to do to avoid this problem is to make the identity of the prosecutor a relevant matter in relation to its obligation to pay the costs.
If it says it will only meet this liability in a case in which the State prosecutes or a State officer prosecutes, including perhaps a police officer, then there would be no argument that this law would apply to the Commonwealth DPP. There is nothing in the case law on section 79 which would make that law applicable. So it is not true to say that there is any inevitability about the imposition of a fiscal liability on the State. The fiscal liability depends upon the interrelationship of two laws, one of which is a State law, and in the absence of that State law there will be no liability.
GLEESON CJ: Have you said what you wanted to say about Commissioner of Stamp Duties v Owens?
MR BASTEN: I have not said much today, your Honour. I think in writing we said that it was an application of a State law to a federal court and that it was for that reason primarily that the result achieved in Owens was a failure to apply the State law. There is another reason perhaps. According to Chief Justice Dixon in Gurnett 95 CLR 110, Owens is distinguishable in that case, and therefore for our purposes, because it was an application for a certificate in relation to the costs incurred in this Court.
GLEESON CJ: That was a dissenting judgment in Gurnett, was it?
MR BASTEN: Yes, your Honour, but other members of the Court in Gurnett do not rely on Owens as authority for the conclusion they reach in Gurnett. That is at 110 point 8 in 95 CLR. The element of dissent, as we would understand it, in the Chief Justice’s judgment is the passage on page 112 where his Honour accepts, at about point 3 and following, that:
The function under the Suitors’ Fund Act is new but it is consequential upon and intimately bound up with the disposition of the appeal.
That is a view which, with respect, we say has merit but was ultimately not accepted by the remainder of the Court in Gurnett, in circumstances where the question was whether this Court should exercise a power which could, had it come to the right conclusion, have been exercised by the Supreme Court below, and that depended on the operation of section 37 of the Judiciary Act which is, of course, in somewhat different terms to the provisions which we are considering. Your Honours, I think that covers ‑ ‑ ‑
GLEESON CJ: May I ask you a question before you finish. It really does not touch your main point at all, but it goes back to the way this Costs in Criminal Cases Act operates. What is the meaning of the expression “the prosecution” in section 3? Does it include for example the police?
MR BASTEN: Read in the context, your Honour, I would understand it to be the authority responsible for instituting the proceedings.
GLEESON CJ: So that you could have an application made under this Act if some time after a trial and an acquittal, or a summary proceeding and an acquittal, there was a Royal Commission into the police force and the Royal Commission discovered that some police officers, without the knowledge of the prosecutor, had engaged in conduct of a particular kind that gave content to section 3.
MR BASTEN: Yes.
GLEESON CJ: So an application under this Act could be made years after the proceedings had come to a conclusion.
MR BASTEN: On its face that would follow, your Honour, because section 3A(2) would allow the defendant to come forward and present further evidence which would no doubt be that to which your Honour refers. It does not appear to be limited to that which was called in the proceedings, and that is understandable because the defendant might have had an alibi which he never got to present, the case having been dismissed at the end of the prosecution evidence.
McHUGH J: But that is strengthened by the fact that this Act was enacted in 1967 and section 2 refers to the court and a judge. Only somebody as old as I am would realise that at that time “a court” was understood as meaning, in New South Wales, the Supreme Court sitting in banc. Section 14 or 17 – I think it was 17 of the Supreme Court and Circuit Courts Act allowed any two or more justices to exercise the jurisdiction of the court, but prima facie the court or judge is really referring to the Supreme Court or a judge of that court and maybe in the case of the District Court, but there would be no reason why an application could not have been made to the Full Court of the Supreme Court in 1967 for a certificate. It did not have to be made to the trial judge.
MR BASTEN: Yes. Your Honour is saying that the trial judge forms part of the court which heard the indictment on the merits, as opposed to the trial judge who held that ‑ ‑ ‑
McHUGH J: And a trial judge exercised the powers of the court, according to various decisions. That is why you could appeal direct from a judge at first instance, in New South Wales, to the Privy Council, or, as Parker v James held in this Court, you could bring an appeal direct to this Court, under section 73. But nothing that the judge did as such, at least, on the civil side, had any effect until judgment was entered, and then it was the judgment of the Court. So, in 1967, it would not have surprised me if it had been held that an application for a certificate could have been made to the Full Court. It would have answered the description of the court, as that was understood. It was not until 1970 that this distinction was changed, in New South Wales.
MR BASTEN: Yes.
McHUGH J: It just strengthens what the Chief Justice was saying, that you could bring an application long after the event ‑ the trial.
MR BASTEN: That may be so, your Honour. Your Honour’s argument depends upon the formulation being the same in 1967. I think it was, in that respect, but I perhaps should check that.
HAYNE J: What meaning, then, do you give to the words, “in any proceedings relating to any offence”? Are those words which, in some way, define a proceeding in which the application may be made, or are they words of greater amplitude than that?
MR BASTEN: Probably not, your Honour, because “the proceedings relating to any offence” are presumably picking up that which follows, “either proceedings where a defendant has had a hearing on the merits and is acquitted”, which would be the trial, “or where, on appeal, the conviction is quashed” – which might be a District Court re‑hearing of a summary offence, for example. So it would take its meaning from the statutory context, I suppose, your Honour. In relation to an indictable offence, it no doubt might be the Court of Criminal Appeal, which would be covered by that terminology.
GLEESON CJ: Thank you, Mr Basten.
MR BASTEN: Thank you.
GLEESON CJ: Yes, Mr Solicitor.
MR SEXTON: If the Court pleases. Your Honours, we propose to deal, in our oral submissions, with five questions: firstly, section 79 of the Judiciary Act; secondly, section 68; third, the question of federal jurisdiction; fourthly, what I could call the appropriations issue; and finally, and fifthly, the question of judicial power – not necessarily all with equal time.
Could I say generally, at the outset – but I will come back to this ‑ that one of the key issues is whether or not the application for a certificate under the Act constitutes separate or different proceedings from the prosecution. We say, of course, that it does. I say that it is an important question because, while all the submissions that are made in this case do not depend on the answer to it, many do, and many of the submissions before the Court are really variants on that theme, one way or the other. Now, in relation to the first of those issues, section 79 ‑ ‑ ‑
KIRBY J: Could I just ask, what follows if one takes that view, which I think was the view that Justice Foster took, is it not? Does it then follow that you do not get into any of the other issues? You just say this is a separate proceeding and the federal element is spent?
MR SEXTON: That is one way of looking at it, your Honour. It does not necessarily avoid every tangent, but it certainly avoids ‑ ‑ ‑
KIRBY J: I am simply trying to trace where the snake or the ladder leads.
MR SEXTON: It certainly avoids many of them, in our submission, your Honour. Now, in relation to section 79 of the Judiciary Act, it is our submission that his Honour Justice Mason was correct in the Court of Appeal in the way that he analysed section 79 and held that it requires the court exercising federal jurisdiction to apply the State law effectively according to its terms. This was a point that was made by your Honour the Chief Justice and Justices Gummow and Hayne in Austral Pacific (2000) – I have 74 ALJR 1184, but it is at paragraph 13 in the report. It is actually at 203 CLR 136. At paragraph 13, what your Honours said was that:
The closing words of s 79 indicate, as the authorities confirm, that the section does not enable a court exercising federal jurisdiction to give an altered meaning to a State statute which it is required to apply.
That is here in the context of where it is generally conceded that the reference in the statute is to State offences.
HAYNE J: Does that argument then mean that a State statute that said, “In prosecution for an indictable offence, the following rules of evidence apply”, that that Act could not be picked up because the offences referred to are State offences?
MR SEXTON: Not necessarily, your Honour. As your Honour Justice Gummow has referred to this morning, there is a question as to what that quotation means and to what it means to say that it has to be picked up with its meaning unaltered. In the context of this particular case, we say that it is important because of the nature of the imposition on the State in relation to what is, in effect – I do not say this critically – a failed Commonwealth prosecution. Perhaps one way of looking at that ‑ because there is a reference in that quotation from Austral to the final words of section 79‑ those words being that in effect the State laws are applicable operate in all cases to “which they are applicable”. What we say is that this is not the kind of law that would be, on the face of it, considered applicable and therefore affected by section 79, because of the nature of the imposition that it makes upon the State of New South Wales.
In Kruger (1997) 190 CLR 1, Justice Gaudron at page 140 said that:
There may be statutory provisions couched in terms which make it impossible for them to be “picked up” by section 79 of the Judiciary Act. Similarly, there may be provisions which impose functions which are beyond the reach of section 79.
GLEESON CJ: Is that why there was a necessity for section 68(1)?
MR SEXTON: Which, your Honour, section 68(1) in this context?
GLEESON CJ: Yes. Is that why it was necessary to have section 68(1) of the Judiciary Act?
MR SEXTON: Well, your Honour, it may be one reason why that that section is there, in the sense that otherwise the consequences that are suggested by those passages could occur.
GLEESON CJ: But that same subsection uses the same words as 79, so far as “they are applicable”.
MR SEXTON: Yes, your Honour. To avoid the consequences, the same consequences that could occur in each section. Seemingly, your Honour, that would seem to be the operation of them.
GUMMOW J: Well is not the answer that section 68 is in Part X, which is headed “Criminal” jurisdiction and section 79 is in Part IX, which is “Suits”. Section 79 is civil by the look of it.
GAUDRON J: But 68 also goes beyond criminal proceedings as such; they relate to charging, arrest, custody and so on, holding persons to bail which might not be picked up by 79 or would not be picked up until it came to write a judgment, in effect, whereas 68 operates at an earlier point as well.
GUMMOW J: I should have said Part XI, which is “Supplementary”.
MR SEXTON: Your Honours, one way of looking at some of the decisions on section 79 including Owens [No 2], in our submission, is that they really turn on this question of applicability. Owens talks about, there, the question of separate proceedings of course, but in a sense, in our submission, the Court was also making the point that those closing words of section 79 would preclude the relevant State legislation being picked up in that instance. We would say the same thing here.
KIRBY J: But you can distinguish Owens on the facts, that that was an endeavour to impose a function on a federal court. So it really does not meet the particular circumstances of this case where it was still before the State judge who had conducted the trial.
MR SEXTON: Your Honour, all of the decisions unfortunately on section 79 can be distinguished in one way or another like that, but it is our submission that in a sense the underlying proposition in Owens [No 2] was the notion of applicability. We say that it is an important part of section 79 because it would prevent this kind of exercise. There was some discussion in the course of my learned friend’s argument about Thomas v Ducret. That of course can be distinguished in the way your Honour has just distinguished Owens [No 2] because the question there was whether reference to a “State court” included a federal court – really a different situation, we would say, from this case. There are of course a number of other decisions which deal with that same issue as in Thomas v Ducret.
KIRBY J: So what is the essential feature in this case? Is it the burdening of the revenue or is it some other element? After all, the federal jurisdiction has been imposed on the State court. The State court has conducted the trial. At the end of the trial one can understand the successful litigant feeling that it is pretty unfair that in the State court he does not get covered by the State Act for costs, even though it has all been conducted in a State court by a State judge and State procedural law.
MR SEXTON: Your Honour, within the context of the federal system it is the question of the imposition on the State in relation to a federal prosecution that has for whatever reason gone awry that we would say goes to the heart of the notion of applicability. As your Honour says, there may be cases that are closer to the line and would present a more difficult question, but we say this is not one of them.
KIRBY J: Is the point of distinction between a procedural law or a law of evidence or a statute of limitations, that all of them just cast burdens on individual citizens, whereas this particular law casts a burden on the revenue of the State?
MR SEXTON: It is the operation of the law, your Honour. It would be possible to have a procedural law that cast a burden on the State presumably, but the examples that your Honour gives do not. That is a point of distinction here.
KIRBY J: Was that in the thinking of this Court in Owens, or did they not have to come to it because it was purporting to impose a duty on this Court?
MR SEXTON: Yes, but it is really picking up, in our submission, the quotation that I made from Justice Gaudron in Kruger that there must be some kinds of laws that will not be picked up because of that concept of applicability.
Your Honours, I was going to move to section 68 but perhaps before I do, there were two questions that were raised from the Bench this morning, one by your Honour the Chief Justice about the transition from Under Secretary to Director‑General. Section 53 of the New South Wales Interpretation Act would deal with that position. It says that where “the name of a body or office” is altered – the Under Secretary would be an office – that a reference in a subsequent Act is to “be read as a reference to the body or office under its new name.”.
Justice Callinan raised the question of taking over prosecutions in New South Wales. Section 50 of the Criminal Procedure Act 1986 requires a prosecution on indictment to be signed for or on behalf of the Attorney‑General or the Director of Public Prosecutions. So that deals with prosecution.
CALLINAN J: It does not matter much whether there has been an enactment or not. There can be no question that the State would have power to legislate to take over all non‑federal prosecutions, I would have thought.
MR SEXTON: Subject to this, your Honour, that in relation to a prosecution for a summary offence the Director of Public Prosecutions can take one of those matters over, that is section 9 of the Director of Public Prosecutions Act, and then decline to proceed if that is the view. Unless your Honour wants me to, I will not go into the ‑ ‑ ‑
CALLINAN J: No, I think it is sufficient that it cannot, I think, be controverted that the power exists anyway.
MR SEXTON: There are some open questions in relation to the Attorney‑General’s power to take over summary prosecution.
CALLINAN J: No, not merely to take over, but to legislate to take over, that is the point, or to legislate to defeat, even, perhaps a prosecution.
MR SEXTON: Your Honours, in relation to section 68, the appellant submits that it applies to the application for a costs certificate because it is expressed to apply where the District Court was exercising jurisdiction with respect to the trial and conviction on indictment of the accused person. Your Honours, in our submission, that submission cannot stand with existing authority of this Court. In Seaegg (1932) 48 CLR 251 the Court held at 257 that the words “with respect to the trial and conviction on indictment” in section 68 did not extend to a jurisdiction to hear appeals from convictions. We would say that it follows from that that an application for this kind of certificate is even further removed from the accused’s ‑ ‑ ‑
McHUGH J: Why would that be so? Surely the words are intended – the purpose of the provision, so far as is possible, is to equate federal procedural law with State procedural law and, indeed, substantive law in so far as it is relevant, and a power to issue a subpoena, to make an order closing the court, matters of that nature, or with respect to the trial on indictment. Why should you read it down?
MR SEXTON: Your Honour, if that question were being considered for the first time ‑ ‑ ‑
McHUGH J: It is one thing to say – and it is really consistent with what we later held in cases like Bond and other cases – that the appeal is not with respect to the trial, but it is another thing to say that the grant of a costs certificate is not with respect to the trial on indictment.
MR SEXTON: There are two answers to that, your Honour. The first is that, in our submission, it could not stand with Seaegg and Gurnett, but there is a second answer which is that, in our submission, it is not really an application here in the normal sense for a costs order. It is quite a different procedure from that to obtain a certificate, which then leads to an application, which then leads to the exercise of a discretion, before the payment can be made.
McHUGH J: Strictly speaking, I suppose the procedure still is there is no acquittal until the judgment is entered. But if an application is made between verdict and judgment, why is that not with respect to the trial? Why is the court not exercising jurisdiction with respect to the trial? You have to say that section 2 is a new and independent grant of jurisdiction.
MR SEXTON: We do, your Honour, yes.
McHUGH J: I understand that.
MR SEXTON: In our submission, apart from the intrinsic qualities of the argument, it is our submission that there has been no suggestion of reopening those earlier decisions of the Court. In our submission, they stand in way of that proposition.
McHUGH J: They are not important. What is the ratio? What do they hold?
MR SEXTON: Your Honour, what they hold is that that phrase with respect to the trial and conviction on indictment ‑ ‑ ‑
McHUGH J: In Seaegg does not include appeal.
MR SEXTON: ‑ ‑ ‑does not extend to collateral proceedings.
McHUGH J: It does not include the appeal, does it?
MR SEXTON: In that case, and in Gurnett that it did not apply to an application for a certificate under the Suitors’ Fund.
GLEESON CJ: I notice that subsection 3(2) of the Costs in Criminal Cases Act says that the certificate does not leave the amount to be paid at large. It is a certificate as to the amount of costs that the judge would have adjudged to be paid if the judge had made an order for costs against the other party.
CALLINAN J: Mr Solicitor, section 3 also raises quite different issues from the issues at the trial. It really is a trial of entirely different issues.
MR SEXTON: Indeed, section 3A, your Honour, really seems to operate on the premise that it the application is separate from the earlier proceedings. It keeps referring to the application ‑ ‑ ‑
CALLINAN J: It is an entirely different inquiry, is it not?
MR SEXTON: Yes.
McHUGH J: Well, one thing, the words “in any proceedings relating to any offence” include an appeal, because subsection 2(b) says so, so the words “in any proceedings relating to any offence” include an appeal.
MR SEXTON: Yes, but, your Honour, the question is really the extent of the words in 68(2).
McHUGH J: I appreciate that, but it shows that ‑ ‑ ‑
KIRBY J: You cannot put a full stop at the end of the verdict or the sentence.
GAUDRON J: I have a further difficulty with those words. Once you see “in any proceedings relating to any offence”, I get the impression there is no scope for separate fresh applications; that the application for the certificate must be in the proceedings that relate to the offence.
MR SEXTON: Well, your Honour, that is why I point to section 3A, because it seems to operate on a different premise.
GAUDRON J: Well, I know it does, but 2 seems to be – well, I would not have said jurisdiction – a grant of power in proceedings in which a court already has jurisdiction. That may have implications for your argument; I mean, that is to say, if I were to adhere to that view, the foundation upon which you started would disappear.
MR SEXTON: Except for this, your Honour, that the State Act, by its terminology, cannot affect the words of section 68(2) and the meaning that they have been given.
GAUDRON J: No, but once you accept that it happens in a proceeding and that it is not a separate proceeding ‑ ‑ ‑
McHUGH J: This is the important distinction between power and authority. Section 2 is a power rather than a conferral of jurisdiction. It is a power, on one view, that can be exercised by a judge or justices exercising summary jurisdiction or indictable jurisdiction or a criminal appellate jurisdiction. It is an additional power. So the jurisdiction is already there. When section 68 talks about courts exercising jurisdiction with respect to the trial and indictment, that is the District Court, and it has the same jurisdiction, so it is not really the section that is relevant so much perhaps as 68(1) or 79.
MR SEXTON: Your Honour, there is also the fact that of course the application for the certificate, as we know, may take place before a different court.
GAUDRON J: Who says that? I do not know that. It may have been so held in the Supreme Court ‑ ‑ ‑
HAYNE J: And it can be made on appeal, I understand that, in (2)(b) but why can it be made to a judge other than the trial judge?
GAUDRON J: I would have thought once you had regard to any proceedings related to an offence, the foundation for that proposition is very dubious.
MR SEXTON: As Justice Gummow raised the question, there may be ‑ ‑ ‑
GUMMOW J: Is there not some decision of the New South Wales courts ‑ ‑ ‑
MR SEXTON: It is Manley.
GUMMOW J: That is it. Do we have that on our list?
MR SEXTON: Your Honour, it is in the New South Wales Law Reports. We will just find the citation. I am just looking at a copy in the Criminal Reports.
GUMMOW J: Because that was some years later, was it not?
MR SEXTON: That was a case from 2000.
GUMMOW J: No, no, the Application of Costs Act was years later.
MR SEXTON: I am sorry. Yes, it was, your Honour.
CALLINAN J: Mr Gageler has the reference, I think.
MR SEXTON: It is 49 NSWLR 203, your Honours. Matters were raised by your Honour Justice McHugh that the application also really involves different parties in the sense that, although the prosecution may be involved, that, of course, the real parties are the accused and, I suppose in this case, the State of New South Wales.
McHUGH J: Not necessarily. It may be that there is no other party.
HAYNE J: Why do you assume there is a lis?
MR SEXTON: That is a separate matter, your Honour. That goes to the question of judicial power and we do not assume that. In fact, we say there is not but in as much as there is a – to call it the application for the moment, it involves, in our submission, at least different parties and may involve a different judge. It can certainly involve a time period, seemingly quite later.
GUMMOW J: Now, do the judgments in Manley take up the matters that Justice McHugh and Justice Gaudron were indicating, namely the classification of section 2 as a power or section 2 is the creation of a new jurisdiction, as it were?
MR SEXTON: Section 2 is referred to at paragraph 55, your Honours. It talks about a power. Your Honour will see that in that and the subsequent pages it talks about it being exercised by another judicial officer.
HAYNE J: But would it not be necessary to deal or to consider the hard case of the judge dying, becoming incapacitated, retiring, et cetera, against whatever background may be afforded by general provisions in a Supreme Court Act or the like which deal with such cases? It would surprise me if there were not to be found in legislation of that kind provisions which deal with substitution of one judicial officer for another in the event of death, incapacity or retirement. It is at that level you resolve those apparently difficult cases.
McHUGH J: Indeed, there is a case in New South Wales ‑ I think one of the parties is a medical board ‑ it was an appeal and the judge died and it was held that, nevertheless, I think section 14 or 17 of the Supreme Court and Circuit Courts Act gave the other two justices jurisdiction to hand down the decision, even though one judge had died.
MR SEXTON: There may be general provisions that make that provision, your Honour.
HAYNE J: Because if there are, then what is against the construction that it is to be dealt with by the trial judge or, if it goes on appeal and it is on appeal that the accused is discharged, by the appellate court?
MR SEXTON: That is a question, your Honour. We would still say, whether or not it is dealt with by the same judge or not, that it still is a separate proceeding, that is, a proceeding that is not picked up by section 68(2) and we also say that it is not a lis.
GLEESON CJ: This question seems to have been considered to some extent in the case of Allerton 24 NSWLR, which dealt with the possibility of ‑ ‑ ‑
MR SEXTON: Yes, your Honour. Some of the questions dealt with in Manley were really raised or flagged in Allerton. I have the Criminal Appeal Reports, your Honour.
GLEESON CJ: Until section 3A was introduced in 1971, was there anything that would have enabled an applicant to rely on evidence that only came to the knowledge of the applicant after the trial was concluded?
MR SEXTON: I am assuming not, your Honour. There may have been an argument in relation to the previously existing provisions, but presumably ‑ ‑ ‑
GLEESON CJ: I am just wondering whether it is a possibility that, by inserting section 3A into the Act in 1971, the legislature altered the meaning of the words “in any proceedings” in section 2.
MR SEXTON: Well, that is a question, your Honours. In our submission, the phrase “in any proceedings” now in section 2 does not really square particularly with section 3A, but perhaps with the ‑ ‑ ‑
GLEESON CJ: And I noticed that section 3A(2) introduces a slightly different concept. It introduces the expression “in relation to any proceedings”.
MR SEXTON: Yes.
HAYNE J: But why is 3A not to be understood as simply permitting reference to evidence that would not be admissible at trial? On its face, it might have been open to argument, may it not, that 2 and 3 confined the attention of the judge to the evidence that was led at trial and not to the evidence not led at trial, as, for example, that the informant acted out of malice or interest.
MR SEXTON: Well, it does have that effect, your Honour, but the question of – going back to the terminology of section 68(2), we say that that phrase, “in any proceedings relating to any offence”, in section 2 of the State legislation would not have the effect of negating, we would say, what is the fairly clear meaning of section 68(2) in its phraseology and in the way it has been construed by this Court.
HAYNE J: The provision of 3A(2)(b) with a grant of leave:
to the prosecutor or to the person representing the Minister to examine –
witnesses may, perhaps, tend to suggest that otherwise there would not be a lis.
MR SEXTON: And it also suggests, in our submission, your Honour, that there is an additional – if not a party, at least an additional factor or person involved in what we would say are the second and separate proceedings. I see the time, your Honour.
GLEESON CJ: Yes. We will adjourn until 2.15.
AT 12.47 PM LUNCHEON ADJOURNMENT
UPON RESUMING AT 2.15 PM:
GLEESON CJ: Yes, Mr Solicitor.
MR SEXTON: If the Court pleases. Your Honours, I had really dealt with section 68(2). I will not take your Honours to the various judgments of the majority in Gurnett. We have set out references to those in our written submissions and they are designed to support out proposition that the application here for a certificate would be a proceeding separate from and subsequent to the prosecution.
Your Honours, that brings me to our third point, which is the issue of federal jurisdiction. In addition to saying that the application for the certificate is a proceeding separate from and subsequent to the prosecution, we say that it was not one in federal jurisdiction and so able to attract the operation of section 79 or section 68. We say that it is not within section 76(ii) of the Constitution as arising under a law made by the federal Parliament and we say, also, that it would not fall within section 75(iii) as a matter in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party.
That is a matter raised by Justice Gummow earlier this morning in relation to section 39(2). We say that that would be so even if the prosecution was in some way present or represented at the application for the certificate. We do not know if that was so, and perhaps Mr Gageler has some information on that question. In any event, we would say, given the terms of the State legislation, that it could not be said at that point that the Commonwealth Director of Public Prosecutions was being sued on behalf of the Commonwealth.
KIRBY J: Mr Basten told us this morning that the DPP was present and objected or opposed the certificate.
MR SEXTON: I thought he said that it had been opposed, but I was not ‑ ‑ ‑
KIRBY J: I cannot see how he can oppose it if he is not there.
MR SEXTON: I simply do not know what the situation is, your Honour, and I was not ‑ ‑ ‑
KIRBY J: Is it in the record? Is there any way that we can tell from our record because ‑ ‑ ‑
MR SEXTON: I do not think so, your Honour, but I did not take Mr Basten as being ‑ ‑ ‑
KIRBY J: I would not want to go outside the record.
MR SEXTON: ‑ ‑ ‑ dogmatic about that. He says he is dogmatic, your Honour.
GUMMOW J: Anyhow, your point is whatever the situation, the Commonwealth was not being sued.
MR SEXTON: Yes, that is so, your Honour.
GUMMOW J: Or suing.
MR SEXTON: That is so, your Honour. On that question of the different proceedings, we point again to section 3A of the State legislation, to which I took your Honours before lunchtime, again to take the language, in a sense, of Gurnett, the notion of separate and subsequent, collateral, et cetera. So that we say that this particular application was no part of resolving a matter in respect of which federal jurisdiction had been conferred.
There might, your Honours, we would say, be an analogy with other separate proceedings following on a criminal prosecution. For example, in the area of victims compensation, which is, of course, available at the State level, or perhaps proceeds in crime legislation, not so much the New South Wales legislation, which has some complications for these purposes, but the federal legislation, we would say, is an example of subsequent proceedings, separate proceedings from the original prosecution.
KIRBY J: The proceeds of crime legislation need not be subsequent to, this often, antecedent, is it not?
MR SEXTON: In New South Wales it can be, I think, your Honour, but I do not think it can be at the federal level. Assuming that it is subsequent, we would draw that analogy. Victims compensation is, perhaps, a better example.
Your Honours, that brings me to our fourth point which is the question of the imposition of payment and the question of appropriation. Your Honours, we have suggested in our written submissions that if this were to be picked up by section 79 or section 68(2), if that was the operation that was proposed, that there would be a problem of inconsistency with some provisions of the Constitution and we have set those out and in a sense that turns around the proposition, as well, of section 45 of the New South Wales Constitution Act which talks about the question of appropriations. I will not go into those matters in detail. They are dealt with at some length in the submissions of the State interveners, but we have referred to them.
In some ways it really recalls the proposition, we would say, that this legislation is not applicable, is to be picked up by section 79. It is the same sort of argument that this question of applicability is really raised by the nature of the imposition.
GLEESON CJ: It is the same sort of argument that is applied to the words “as nearly as possible” in section 64, is it not?
MR SEXTON: Yes, your Honour. Well, it is, in some ways, a similar argument, but in relation to section 79, we say that one looks at the nature of the law, and that that is – in a sense, it also raises those constitutional sections, but the preferable way, in our submission, of looking at it is by looking at the words of section 79.
Now, the final issue, from our point of view, is that of judicial power. These submissions really are based upon the premise that, contrary to what we have already put forward, the District Court was exercising federal jurisdiction in determining the application for a costs certificate. In our submission, that exercise would not be one of judicial power and, therefore, not one that could be picked up by those provisions of the Judiciary Act.
If one looks at section 4 and section 5 of the Costs in Criminal Cases Act, it is clear that there is, in a sense – or if one combines that with section 2 – there is a three‑stage process: an initial application to the court; followed by the holder of the certificate making an application to ‑ at that time – the Under Secretary; and then, finally, the Treasurer considering that second application. If one looks at section 4(5), we would say that there is quite a broad discretion given to – at that time – the Treasurer, in relation to that second application.
The words in subsection (5) that suggest the breadth of the discretion, in our submission, are that:
the Treasurer . . . considers –
we emphasise that word –
that, in the circumstances of the case –
again, seeming to provide a discretion –
the making of a payment to the applicant is justified, the Treasurer may pay to the applicant his costs or such part thereof ‑ ‑ ‑
KIRBY J: But it is not a whim. It has to be exercised by the Treasurer as the designated donee of the power for the purposes of the Act, so it is not at large. You cannot just say, “We’re running out of money”, or could he?
MR SEXTON: I am not sure of that, your Honour. When it talks about “the circumstances of the case” ‑ ‑ ‑
KIRBY J: But it is an individual case. It is not as a matter of general policy. It is a matter of the individual case.
MR SEXTON: That may be, your Honour, but, in our submission, it does give a proper discretion to the Treasurer and we would say that it is not a decision that could be successfully challenged if the Treasurer decided to withhold payment for a reason that was not completely capricious or arbitrary. It can be contrasted in a sense with the wording of the federal legislation in the BLF Case, which we would say was much more constrained in terms of the Attorney‑General’s role, that this is in fact on the face of it a broader discretion.
GLEESON CJ: I would have thought it suited your argument on point No 4 to confine the discretion.
MR SEXTON: I was going to say, your Honour, that I put this argument alternatively to the previous one, and that is quite right, that if one takes the view that the discretion is confined, that does assist the previous argument, your Honour is quite right, but for the purpose of this argument one can look at those terms of the provision.
Your Honours, if I could refer briefly to a case that is not in our submissions, which is case of Newcastle Coal Co v Firemen’s Union (1908) 6 CLR 466. The judgment, which occupies only really a paragraph, is at 468 at point 8, and this concerned a “recommendation by the Industrial Court to the Governor” concerning the establishment of a board and Chief Justice Griffith simply noted that that could not be regarded as a judicial proceeding.
We simply refer to that in support of the proposition that if one takes the whole scheme here under the Costs in Criminal Cases legislation, that it really is not an exercise of judicial power and it is necessary, in our submission, to consider the scheme as constituted by those sections as a unit and not to separate them in the way that, of course, my learned friend puts to your Honours for the purposes of his argument.
GLEESON CJ: That report seems to indicate that Mr J.L. Campbell had a bumpy passage.
MR SEXTON: Yes, your Honour. So we point to those provisions of the State legislation in relation to that argument concerning non-judicial power. Now, your Honours, unless there are any other specific matters, those are the submissions that we wish to put before the Court.
GLEESON CJ: Thank you, Mr Solicitor. Yes, Mr Gageler.
MR GAGELER: Your Honours, the third respondent is, of course, correctly identified as the Commonwealth Director of Public Prosecutions. The answer to your Honour Justice Gummow’s factual question is perhaps unsatisfactory, but it is this, that on the application before Justice Keleman the Director of Public Prosecutions, who had been the prosecutor in the trial, appeared by counsel and announced to the court that he was there to assist the court on the question of jurisdiction and that he was prepared to address the court on the section 3 considerations, if it came to that. As it turned out, argument was put just on the jurisdictional question, and that is where the matter was left.
I should point out that in the formal order that was taken out some 18 months after the decision of the court, at page 6 of the appeal book your Honours will find the Crown appearing as respondent. In our submission, that makes no difference to the substance of the matter.
On issues of constitutional validity, I adopt in advance and in their totality the submissions to be put by the Attorney-General for the Commonwealth. I propose to confine my oral submissions to questions of construction and to deal with section 68(2) in advance of section 79.
The starting point for section 68(2) is to recognise that the appellant was charged with an offence against section 233B(1)(d) of the Customs Act of the Commonwealth, that being an offence punishable by a term of imprisonment exceeding 12 months, under section 235, and therefore being indictable by virtue of section 4G of the Commonwealth Crimes Act. In those circumstances, section 68(2) operated to pick up the jurisdiction conferred on the District Court by section 166 of the District Court Act 1973 of New South Wales and section 11(2) of the Criminal Procedure Act 1986 of New South Wales and to confer a like jurisdiction on that court.
GUMMOW J: What is the date of the Criminal Procedure Act?
MR GAGELER: 1986.
GUMMOW J: Thank you.
MR GAGELER: The District Court, on the trial of the federal offence on indictment, was therefore uncontroversially to the point of acquittal, exercising federal jurisdiction under section 68(2)(c) of the Judiciary Act. The matter, or justiciable controversy, to be quelled by the determination of the court being the claim or charge that the present appellant had committed an offence against a particular law of the Commonwealth. In framing the matter in those terms, I have deliberately adopted the language of the Full Court of this Court in R v Murphy, (1985) 158 CLR 596 at 617, point 8.
The two questions that then arise under section 68(2) are, in my submission, these. The first is whether the words “with respect to” sufficiently expand the jurisdiction conferred by section 68(2) so as to encompass the jurisdiction or power to grant a costs certificate under section 2 of the Costs Act. The second is whether jurisdiction conferred by section 68(2), picking up section 2 of the Costs Act, would or could be like jurisdiction to that which would be exercised by the District Court in respect of a State matter, with section 2 applying directly. Can I address both of those? The first has been addressed to some extent by my learned friend, the Solicitor‑General for New South Wales. The second I think has not yet been addressed.
The words “with respect to” clearly enough are words of degree. They connote some degree of connection, the precise degree of connection turns on the context. There is always a line to be drawn. In the context of section 68(2), how the line is to be drawn was, in my submission, indicated in the decision of the Court in Seaegg, 48 CLR 251, in particular at page 257, point 3, whereas part of the reasoning of the Court it is clear enough that what is being focused upon is the language in the context.
McHUGH J: I am not sure it has much to do with this case. First of all it is an assertion.
MR GAGELER: Yes.
McHUGH J: It is a judgment obviously written by Sir Owen Dixon. He just simply says that those words in 68(2) would not naturally be understood as referring to jurisdiction to hear appeals from convictions. Accepting that, where does it lead to? Nowhere.
MR GAGELER: I said it was indicative, your Honour. That is as far as I put it.
McHUGH J: But your argument also depends upon the view that section 2 confers jurisdiction.
MR GAGELER: Yes.
McHUGH J: Why is not the proper view that it simply confers a power in criminal proceedings, and if that is so then you have the same jurisdiction under 68(2). The court has the same jurisdiction under 68(2) as it would have in the State jurisdiction. The real question then becomes really a 79 question, or perhaps 68 question as to whether or not, given the content of the Act as a whole, that is the Costs Act as a whole, it is applicable in those proceedings.
MR GAGELER: I will come to 79 in a moment. I am addressing section 68 by saying – I had said that the matter which is uncontroversially before the court, under section 68(2)(c), is the claim or the charge that an offence has been committed against a particular law of the Commonwealth. I said that that formulation of the matter came from Murphy. By definition, that matter, as so defined, must come to an end upon acquittal. The question that I am addressing ‑ ‑ ‑
McHUGH J: But why? Take, for instance, what is not uncommon: an order made by the judge after an acquittal that property be given to somebody or other. It may be returned to the accused. Now, that is still part of the proceedings. Why ‑ ‑ ‑
MR GAGELER: Your Honour, I fully accept that there is a question of degree. There will be orders that are made and, most significantly, in relation to a trial that results in a conviction, there will be orders concerning penalty. I accept that those orders and the proceedings relating to penalty will be with respect to it. All I am saying is that under 68(2) there is a line to be drawn, and an indication of how the line is to be drawn is provided by (c). I cannot say that it is determinative, your Honour.
McHUGH J: Well, speaking for myself, I think the first question is whether or not section 2 of the Costs in Criminal Cases Act is a power which is exercised within the criminal jurisdiction of the State court.
MR GAGELER: I will address that – it is a little out of order. No 1, if your Honour is focusing on the opening words, that:
The Court or Judge or Justice or Justices in any proceedings relating to an offence –
may do certain things, the words, “in any proceedings relating to an offence”, in my submission, are words which identify the court or judge or justice or justices who may then exercise the power conferred. I am content to call it a power, the power being one that applies necessarily only after acquittal. While your Honour may well and properly call it a power, what section 2 is doing is performing the double function that legislation so often performs – and is referred to in Barrett’s Case and many other cases – of enabling a court to make an order which then has certain consequences.
KIRBY J: But “relating to” are, traditionally, broad words of connection. It is not as if it says “in the trial of an offence” or “leading or following or up to the conviction of an offence”. It just says “relating to”.
GUMMOW J: Well, it has to accommodate appeals, because of (b).
MR GAGELER: Yes.
KIRBY J: And if it has to accommodate appeals, well, these applications are conventionally made before appeals, or made immediately after the hearing of the primary case. It is pretty hard to knock this one out on “relating to”.
MR GAGELER: I certainly was not. I was not, and what I am seeking to do, your Honours, is to address the scope of section 68(2). The words that I am addressing are “with respect to”. The only point that I sought to make from Seaegg’s Case is that it is implicit in what was admittedly asserted, but by the Full Court, including Sir Owen Dixon in that case, was that the words “with respect to” in that context are to be read somewhat narrowly. What is being focused upon is something forming part of, or very closely connected with, the trial or the conviction.
In my submission, such use of language was confirmed by the Parliament in its 1932 amendment, which your Honours will see set out in the appeal book at page 23, which, in dealing with appeals, added the words “and with respect to” appeals, that is using the same language of identification. Accepting that the question is one of degree, in my submission, section 2 of the Cost Act simply lacks a sufficient degree of connection. Number one, it applies only after acquittal. Number two, it does not involve the same parties as those involved in the prosecution. Indeed, section 3A(2)(a) makes it clear that the prosecutor is not a party to such an application but can, with leave, participate to some degree in the evidence in the submissions.
McHUGH J: You throw all the weight of the argument on section 68(2).
MR GAGELER: No.
McHUGH J: To a large extent you are.
MR GAGELER: I am not throwing any weight around, your Honour.
McHUGH J: I would have thought that the emphasis was to be thrown on (2) and you ask yourself, “Is the issue of this certificate, the exercise of this power, a matter within the jurisdiction of the District Court relating to this particular offence?” If it is, then as night follows day, section 68(2) applies, in terms of jurisdiction. It does not say anything about what laws. The jurisdictions are going to be identical.
MR GAGELER: Sorry, your Honour.
McHUGH J: The jurisdiction of the State court and of a State court exercising federal jurisdiction are identical. The powers may be different.
MR GAGELER: The point that I have probably not made clearly enough is that, in my submission, there is a matter before the District Court that is constituted by the prosecution for an offence. That matter comes to an end upon acquittal. That is the starting point.
McHUGH J: Yes, I understand that.
MR GAGELER: The second step, then, is to ask whether the words “with respect to” then expand the jurisdiction federally conferred on the District Court to pick up what, in my submission, is necessarily a separate matter.
The other aspect, as your Honour Justice Callinan had pointed out ‑ ‑ ‑
GAUDRON J: At the very least the jurisdiction would not end until a judgment of acquittal was entered, though. It is conceivable, is it not, that after verdict and before judgment, an application might be made.
MR GAGELER: Section 2(a) is “acquitted”, so it is only after acquittal.
McHUGH J: Yes, but acquittal does nothing. You cannot appeal against a jury’s acquittal. It has been held again and again that that is the case. What you appeal against – you do not appeal against the verdict. It is the judgment of the court which captures of the acquittal. I will think of it in a moment, but there is a decision in this Court right on it. It might be Snow’s Case, I think.
MR GAGELER: Your Honour, I am not talking about appeal and I do not disagree with what you have said.
GAUDRON J: What I am suggesting is that it is at least conceivable that after the verdict and before judgment an application is made under section 2 so that the jurisdiction with respect to the matter constituted by the prosecution would not be exhausted.
MR GAGELER: Your Honour, that is possibly a question of determining what the word “acquitted” means in section 2(a). In my submission, it means by judgment.
GAUDRON J: A judgment, yes.
MR GAGELER: The other aspect of section 68(2), if I can come to it, is this, that in conferring like jurisdiction, section 68(2), it has been held, operates to pick up State jurisdiction and associated rights to invoke that State jurisdiction and to confer an analogous federal jurisdiction and associated rights to invoke that federal jurisdiction. The most useful citations are collected by Justice Foster at pages 71 and 72 of the appeal book and to them can be added Rohde v DPP 161 CLR 119 at 124 to 125.
What that means in the present context, in my submission, is this: to the extent that section 68(2) can pick up and apply anything by analogy, all that it can pick up and apply by analogy is the jurisdiction or power conferred by section 2 of the Costs Act and the associated right of the appellant in this case to approach the court for an exercise of that jurisdiction. Section 68(2), being concerned as it is with the jurisdiction of a court, is simply not addressed to provisions such as the separate administrative machinery provided for by section 4. That, in my submission, is simply beyond the scope of anything that is picked up by section 68(2).
If that is right, then, unless section 4 is also somehow picked up by section 79, to which I will come in a moment, or section 4 in its terms can be read as applying to a certificate granted under section 2 as federalised and made applicable by section 68(2), then the jurisdiction that could be picked up by section 68(2) just could not be like jurisdiction with the State jurisdiction. Indeed, section 2 without section 4 not only would be not analogous jurisdiction, it would be a futile jurisdiction.
GUMMOW J: Yes. In other words, you give to the phrase “like jurisdiction” some element of necessary utility.
MR GAGELER: Yes, exactly. I will come to the section 79 point in a moment, but that is what we say about section 68(2). Can I turn then to section 79 and, again, confining my ‑ ‑ ‑
GUMMOW J: Then the concomitant notion of 79 is applicable so far as applicable.
MR GAGELER: Yes. I will deal with that specifically, your Honour. If one just looks at the text of section 79 – and I am confining my submissions to construction – there are, in my submission, three relevant limitations. The first is that the section is directed only to courts “exercising federal jurisdiction” described in the present continuous tense. That is, it only cuts in when a court is first exercising federal jurisdiction. The second limitation is that it is in terms directed only to the laws that “shall . . . be binding” on those courts. It is not directed specifically to the rights of the parties and is not directed in any way to the rights of persons who are not party to the proceedings before the court.
Thirdly, the laws that it makes binding on courts exercising federal jurisdiction are identified in the section as:
The laws of each State or Territory . . . in all cases to which they are applicable.
And those two phrases, separately or in combination, have always been interpreted as meaning that the section picks up State laws with their meaning unchanged.
Can I address the three limitations in the present context rather briefly. So far as the first limitation is concerned, if it is correct that the jurisdiction conferred under section 68(2) came to an end upon acquittal, then the court would not be exercising federal jurisdiction under section 68(2) in an application under section 2 of the Costs Act and therefore there is no basis upon which section 79 would apply.
McHUGH J: Do you concede that, subject to the section 4 argument, and maybe section 79, that a costs order could be made on an acquittal entered on an appeal?
MR GAGELER: Under this Act?
McHUGH J: Yes, under this Act. Look at section 68(1)(d), “The laws of a State” on:
the hearing and determination of appeals arising out of any such trial or conviction or out of any proceedings connected therewith;
Now, why cannot the Court of Criminal Appeal give a certificate on the appeal?
MR GAGELER: It would still be a separate proceeding, your Honour, a separate matter.
McHUGH J: But 68(1)(d) talks about “any proceedings connected therewith”.
MR GAGELER: I am coming to that. I am making a concession in stages, your Honour. The first point that I would make would be that that does not, in any way, affect my point that an application under section 2 would not be part of the appeal proceeding. It would be, at best, a separate matter although connected with the appeal. I confess that I find it difficult to say that it would not be connected with the appeal within the meaning of section 68(2).
GLEESON CJ: But, as I understand it, part of your argument is, in relation to section 79, that section 4 and, in particular, subsections (5) and (6), do not bind any court.
MR GAGELER: Exactly, yes. That is an argument that I am going to put and I did not take your Honour’s question to be asking me to concede that.
McHUGH J: No.
MR GAGELER: Yes. I am still dealing with the first limitation on section 79, that is that there must be first an identifiable exercise of federal jurisdiction before section 79 cuts in. I dealt with jurisdiction under section 68(2). It is necessary also to deal with jurisdiction under section 39(2), either by virtue of section 75(iii), because the DPP is relevantly the Commonwealth, or by virtue of section 76(ii), because the prosecution was for an offence against Commonwealth law. There was, in the prosecution, a matter arising under section 39(2) as well as section 68(2), but that matter, as I perhaps have already submitted in relation to section 68(2), terminated upon acquittal.
Now, the question is then whether there is a new matter that can be constituted by the application under section 2, and accepting that there can be a matter that is an exercise of judicial power, the question is whether it is one that falls within either section 75(iii) or 76(ii). In my submission, there is not, in that an application under section 2 of the Costs Act is not one to which the prosecutor is a party, and that is made clear as I said by section 3A(2)(a).
GUMMOW J: Not just a party.
MR GAGELER: Pardon?
GUMMOW J: You have to be sued.
MR GAGELER: Sued, yes that is right.
GUMMOW J: The interveners become parties maybe.
MR GAGELER: Yes.
GUMMOW J: But you have to be sued.
MR GAGELER: You have to be sued. That is the better point. By that stage we have left the Customs Act well and truly behind. So there is no matter arising under a law of the Commonwealth at that point. That is the first limitation.
The second limitation is that section 79, as I said, is directed only to laws binding on a court, and therefore binding on the District Court. Section 79 itself can at best pick up section 2. It cannot pick up section 4, a separate administrative machinery, just as section 79 could not pick up proceedings in the Mining Warden’s Court in the Commonwealth v Western Australia or proceedings in the Residential Tenancies Tribunal in Henderson’s Case. Again, to pick up section 2 alone would be, in our submission, to give that provision an altered meaning.
GUMMOW J: The real question in this matter is in a way, what comes to us is an appeal for the Court of Appeal.
MR GAGELER: Yes.
GUMMOW J: There was an application in the original jurisdiction for certiorari.
MR GAGELER: Yes.
GUMMOW J: Why would you grant certiorari to tell the District Court to try again if it is only going to produce a futility? Namely, it is going to produce a certificate that will not go anywhere. So why would you give them certiorari to do that?
MR GAGELER: Your Honour is putting it as a matter of discretion. You certainly would not do it as a matter of discretion. What I am seeking to show is that there would be no jurisdictional error to start with.
GUMMOW J: Yes, I understand that.
MR GAGELER: On this point, can I give your Honours three very quick references. One is Commonwealth v Mewett, 191 CLR 471 at 556, and it is just a sentence in the joint judgment of your Honours, Justice Gummow and Justice Kirby. What your Honour said at about point 3 is:
Thirdly, the Commonwealth could utilise the NSW Act –
this is a Limitation Act –
only on its own terms and after the amendments by the 1990 Act. These provide for a regime of extensions of limitation periods as an integral part of the legislative scheme.
This is the important sentence:
Section 79 could not operate to pick up some but not all of the otherwise applicable terms of the NSW Act, for to do so would be go give an altered meaning to the State legislation.
Secondly, in Smith v Smith 161 CLR 217, a case which is not without controversy in so far as it held that the Family Court did not have accrued jurisdiction which enabled it to exercise the power conferred on the Supreme Court of New South Wales by section 31 of the Family Provision Act. It is not on the accrued jurisdiction point that I want to go at the moment. It is to another point addressed in the joint judgment of Chief Justice Gibbs, Justices Wilson and Dawson. Their Honours were concerned as I said with section 31, which your Honours will see at page 225. It was a provision that conferred power on a court to grant an approval. I ask your Honours to look specifically at subsections (2) and (3), which then operated as a matter of State law on the approval granted by the court.
Then at page 240, at about point 3, in the joint judgment, this is said:
There is a further, and quite independent, reason for concluding that the Family Court cannot give an approval for the purposes of s. 31 of the Family Provision Act. That section makes a release effective only if the Supreme Court has given its approval to it. An approval by the Family Court is not an approval by the Supreme Court, and would not satisfy s. 31(3).
Then over at page 241, developing the same theme:
The Solicitor-General for the Commonwealth submitted that s. 31 of the Family Provision Act performs the double function of dealing with substantive rights and liabilities, and giving jurisdiction to the Supreme Court in respect of those rights and liabilities . . . That may be true, but it is irrelevant. The fact remains that s. 31(2) and (3) makes the efficacy of the agreement depend on approval by the Supreme Court. The provisions of those two sub‑sections are analogous to an enactment that makes the effectiveness of a contract depend on a seal or stamp. Absent the seal or stamp, the agreement is not effective, whether it is sought to be enforced in a State court or in a federal court.
Then, penultimately, the reference in Edensor 177 ALR 329 ‑ ‑ ‑
McHUGH J: It is in the Commonwealth Law Reports now.
MR GAGELER: Your Honour is ahead of me. It is paragraph 74, in any event, that I wanted to refer to, in the joint judgment, which summarises the holding in Owens [No 2], page 593, paragraph 74. One could go back to Owens itself, but, as usefully summarised there, it was held that:
The grant of a certificate under s 6 of the State Act formed a step in machinery which had been established for the indemnification out of a fund –
therefore could not be picked up.
Finally, in this respect, can I draw your Honours’ attention to Pedersen v Young (1964) 110 CLR 162 at page 165. At the bottom of the page – indeed, the last three lines ‑ your Honours will see the origin of the terminology, repeated many times subsequently, that section 79:
does not purport to do more than pick up State laws with their meaning unchanged –
and, significantly, your Honours may note that Justice Kitto referred as authority for that proposition to Owens [No 2], his Honour having been a member of the Court in Owens [No 2].
CALLINAN J: Mr Gageler, how could the Judiciary Act pick up the reference to “Minister” in section 3A(2)(a) in any event?
MR GAGELER: It could not. My point is that the Judiciary Act could not get past section 2, but I accept your Honour’s point. If it got past section 2 ‑ ‑ ‑
CALLINAN J: It would be an odd result if it could pick up bits and pieces of the Act but not pick up what seems to me to be a fairly important part of the Act; that is a part which gives the Minister a right of contradiction.
MR GAGELER: Yes, I agree with that, your Honour. Can I just address the third limitation and do so very quickly. It is dealt with in paragraph 10 of my original written submissions. That is that section 2 of the Costs Act, even if picked up by section 79, could still only apply to proceedings
relating to an offence against State law. That is simply an aspect of the principle that section 79 picks up State law with its meaning unchanged. Again, the best and most useful illustration of that and probably in the most analogous context is Pedersen v Young itself, to which I have already taken your Honours, where it was held that a Queensland Limitation Act which, properly construed, only applied to actions commenced in Queensland, when picked up by section 79 still only applied to actions commenced in Queensland.
Thomas v Ducret, upon which the appellant relies in this respect, is not authority to the contrary. Indeed, it was not a case that was concerned with section 79 at all; it was concerned with section 18A(1) of the Crimes Act, which was said in that case to be analogous to some extent to section 79 but is in truth more closely analogous to section 68(1) of the Judiciary Act in that, as your Honours will see from 153 CLR 507 at page 509 where the section is set out, what it did in terms was make State law applicable not to courts exercising federal jurisdiction but to persons convicted of State offences. So, in making State law applicable to persons convicted of State offences, it necessarily meant that the State law had to be notionally modified so that where it referred to State offences, it was to be treated as referring to Commonwealth offences. Beyond that, there was no change to the meaning. Your Honours, those are my submissions.
GLEESON CJ: Thank you, Mr Gageler. Yes, Mr Solicitor.
MR BENNETT: Your Honours may have observed that when I announced my appearance, I omitted the customary words, “intervening in the interests of” the appellant or a respondent. That, as your Honours have seen, is because we support the appellant on some aspects and the second and third respondents on some aspects. In particular, we adopt all the submissions on the construction issues of the third respondent. May I just add this, that if your Honours go to the Costs Act, it is quite clear, we would submit, that the words “pursuant to this Act” in section 4(2) have the effect that a certificate granted under picked‑up provisions is simply not such a certificate.
It was said, for example, in Maguire v Simpson by Justice Gibbs as he then was, that where section 79 or one of the corresponding sections of the Judiciary Act picks up a State provision it is the federal law which is applied. Maguire v Simpson 139 CLR 362, the passage is at page 377. It is really a very, very short passage. In the middle of the page, your Honours see the words “Limitation Act” in the left‑hand margin, just above that his Honour says:
The effect of s. 64, stated more directly, is that the Limitation Act which is to be applied in the proceedings by virtue of s. 79, is rendered applicable to the Commonwealth as though it were a subject, and therefore binds the Bank. The Limitation Act is so applied by force of Commonwealth law, and not by its own force as a State law.
Can I also remind your Honours of Glasson v Parkes Rural Development where one had an official who made a determination pursuant to a power given under State law but under a scheme which was almost entirely based, for practical purposes, on the Commonwealth law. The question was whether it was a decision under an enactment under the AD(JR) Act and, again, the Court said that one looked at the precise source of the power.
McHUGH J: I cited that passage, I think, of Maguire v Simpson in Airservices, I think.
MR BENNETT: Yes, I think so too, your Honour. The words “pursuant to this Act” mean what they say and we would submit it simply does not include pursuant to a federal Act which happens to pick up, by reference, words of this Act. We also direct attention to the fairly obvious proposition that it would be surprising if a State Act of this nature were intended to apply to a Commonwealth prosecution. Most importantly of all, the provisions in section 4(6) about the appropriation, are simply provisions which are totally inappropriate to a federal Act, to be picked up by a federal Act. Despite the fact that we intervened to support the Commonwealth power, we would not suggest for one moment that the Commonwealth has power to effectuate an appropriation from a State Treasury. I say that subject to a very possible exception under section 78 of the Constitution but that does not arise in this case.
It is quite clear that the operative provisions of this Act, the provisions which result in money being paid to the acquitted defendant, are provisions which simply cannot operate, so what is there to pick up? The making of a determination by a trial judge which, to use the phrase used in earlier submissions by the Director, would be a brutum fulmen, they would be completely pointless and useless. Why, one asks rhetorically, would one pick up provisions which had that effect? In my respectful submission, one simply would not.
GAUDRON J: I suppose there is also a question of whether they can be picked up but that is a constitutional issue.
MR BENNETT: Yes. Well, I will come to that, your Honour. Before I come to the constitutional issues, may I stress as hard as I can that we submit they simply do not arise, for the reasons I have given and the reasons my learned friend, Mr Gageler, has given and that if they do not arise, we would respectfully submit it is inappropriate for them to be dealt with in this case, but the matters having been raised, I do need to deal with them.
Your Honours, the only aspects I need to deal with are three and they are the aspects contained in Part 5 of our submissions, Part 6 of our submissions and a short answer to the additional submission made by South Australia.
McHUGH J: What do you say in relation to your submission concerning the words “pursuant to this Act” concerning the statement of Justice Mason in John Robertson where he said that:
it is necessary that State laws be applied according to the hypothesis that federal courts do not necessarily lie outside their field of application –
and that you have to look at the substance of the matter?
MR BENNETT: Because, your Honour, we are not talking about, in that argument the application of the Judiciary Act. We are talking about the application of State law contained in section 4 of the State Act. It is in looking at the State law, and only State law, in section 4, that one has to ask: what is the meaning of the words in section 2? I am not looking at those words for the purpose of seeing what is picked up by the Judiciary Act. I am looking at them for the purpose of seeing whether section 4, as a State law, is capable of adopting them.
McHUGH J: Well, I appreciate that, but it may be that because it is picked up as federal law, section 4 is then to be read as federal law, then that takes you into the constitutional area as to whether the ‑ ‑ ‑
MR BENNETT: Your Honour, we would submit section 4 could not be read as federal law, for a number of reasons. The first is the provisions about the ‑ ‑ ‑
McHUGH J: I know that is what you would say, but, for instance, it has been held in a couple of cases where a reference to a court, which obviously meant State court, has been read ‑ ‑ ‑
KIRBY J: Edensor is the clearest example.
McHUGH J: Edensor.
KIRBY J: This is the point on which I disagree.
MR BENNETT: Yes. Well, your Honours, there is no difficulty, subject to what Justice Kirby says, about taking over, on the basis of cases like Robertson v Transformers and Edensor, references to a court. Obviously if a State law says the procedure in a State court dealing with criminal offences will be that evidence is given on oath, then that provision is picked up and applied to federal courts where they do it and clearly one can do that and clearly ‑ ‑ ‑
KIRBY J: But the problem with Edensor was that there was a Court, capital “C”, and a court, small “c”. We do not have that problem.
MR BENNETT: No, we do not have that problem here. Then there is the next step, which is the case where you have the State Act referring only to a Magistrates’ Court or only to ‑ ‑ ‑
McHUGH J: I understand all that, but you want to read “pursuant to this Act” and this federal context as being “pursuant to this New South Wales Act”, but why can it not operate so that section 79 picks it all up and “pursuant to this Act” means “pursuant to this federal legislation”?
MR BENNETT: If section 4 otherwise could be picked up, that would not be a problem. The argument I have put, based on section 4, assumes that section 4 is not picked up and is not picked up for all the other reasons I gave.
GLEESON CJ: The only words in section 79 that are capable of picking anything up are words that make laws binding on courts.
MR BENNETT: Yes precisely, your Honour. It is not binding on any court. It is something which the Treasurer or the Under Secretary and so on, the Director‑General now, are directed to do. It is nothing to do with the court at that stage.
KIRBY J: Yes, but Mr Basten’s answer to that is take it in stages please. We are just dealing now with what the court does. The court has a function. Do your court thing and we will deal later with the Treasurer if he becomes stroppy. After all your client has not procured the enactment of parallel legislation, which is a cause for comment. It is not just in this country that it should depend on whether you are prosecuted under a federal or State Act as to whether you get your costs paid if the prosecution fails. It just is not just.
MR BENNETT: That might still be the result, your Honour, because some States do not have this legislation as I understand it.
KIRBY J: Yes, but we are talking about a prosecution in New South Wales where the accused is acquitted. He stands in the well of the court. He sees somebody next door who is acquitted and gets their costs and he does not.
MR BENNETT: If we were to pass such an Act, the effect might be that in another State the same thing would happen the other way around.
KIRBY J: Yes, that might be tolerable, but it is not – one can understand a sense of injustice on the part of the appellant.
McHUGH J: But in New South Wales you can have a situation where a person is tried in the same court on a federal offence and a State offence. It often happens in drug cases.
MR BENNETT: Yes, and that could happen ‑ ‑ ‑
McHUGH J: So you get a certificate in respect of the State charges but none under the federal charges.
MR BENNETT: That would be so, your Honour.
KIRBY J: I hope this case will call your client to have regard to the injustice that is caused by the situation that arises here, if it is not able to be solved otherwise.
MR BENNETT: Your Honour, it is enlightened legislation. It was not enacted in New South Wales until 1967 ‑ ‑ ‑
McHUGH J: That is 35 years ago.
KIRBY J: It took your client a long while to get up with the Suitors’ Fund Act equivalent too. The Commonwealth moves very slowly in these matters, very slowly.
MR BENNETT: The States have different provisions too in that area as I understand it.
KIRBY J: I do not think you can defend it in terms of principle.
MR BENNETT: In any event, your Honour, the issue in the present case is a very precise one. In my respectful submission, as a matter of construction for the reasons I have given, it cannot be picked up.
Now, may I turn to Part 5 of our written submissions. On the first question – and these are some arguments on which we support the appellant. We submit that there is nothing contrary to judicial power in the type of legislation that is involved here. In other words, if there were a Commonwealth Act having corresponding provisions, it would be properly within judicial power. The best analogy is probably the Extradition Act because that is a case where there is a determination by a magistrate of eligibility for surrender, and then an exceptionally broad discretion in the Attorney-General as to whether he or she does surrender. There is nothing wrong with that. Even if one looks at the Builders Labourer’s Case, and even if one looks solely at the judgment of the Chief Justice, one still finds some legislation which is very much distinguishable because that was legislation which provided that the court would give a certificate that it would be appropriate for the Attorney‑General to authorise a payment.
GAUDRON J: But you would not make the same submission if the certificate was going nowhere, would you?
MR BENNETT: No, your Honour.
GLEESON CJ: Not a certificate in aid of an application for an ex gratia payment.
MR BENNETT: Except to say this, that Justice Brennan certainly took the view that it was an ex gratia payment and that there was an absolute discretion in the Attorney‑General, but nevertheless that it was valid. Now, what it depends on is what the court certifies. If the court merely certifies a precondition to an absolute discretion, there is nothing wrong with that. The court is determining a necessary condition which affects a person’s rights, the right being a right to have the Attorney‑General make a determination one way or the other, or exercise a discretion.
That is all this Act does. So while there may have been room for an argument – although it did not succeed – in the Builders Labourers’ Case, to the effect that, there, the court was simply doing what the Attorney‑General could undo ‑ the court was determining that it would be appropriate for the Attorney to do something, and then the Attorney decided whether he was going to do it ‑ this case is quite different, because the legislation here, if one looks at it closely – might I just take your Honours very briefly to the Costs Act – the legislation here gives the court power to grant a certificate:
specifying the matters referred to in section 3 –
So what the certificate does in section 3 is to specify that:
if the prosecution had, before the proceedings were instituted, been in possession of evidence of all the relevant facts, it would not have been reasonable to institute the proceedings –
and that no act of the defendant contributed. So the court specifies certain facts. Those facts then operate as a condition precedent, or that certificate operates as a condition precedent to the whole host of powers in section 4 ‑ ‑ ‑
GLEESON CJ: Now, suppose that under section 3(2), in a Magistrates Court, the amount of costs is quantified, and then, under section 4(5), the Treasurer turns his mind to the question of whether to pay that amount or part thereof. What would be the available discretionary considerations that might lead to a decision to pay part of the amount that the magistrate has quantified?
MR BENNETT: I think, first of all, that may be one of the subsections that has been amended, at the relevant time – but I will not take time with that ‑ section 3(2). The second answer to your Honour’s question is this, that all the certificate does under subsection (2) is specify the amount of costs he or she “would have adjudged to be paid”. So the court says, “Well, I would have ordered a payment of $10,000”, but the court is not determining the amount to be paid in a way which can be set aside. The certificate operates as a maximum and it simply operates, therefore, as a part of the factum on which the subsequent discretion is exercised.
We also adopt the arguments put by my learned friend, Mr Basten, in relation to the differences between the five Justices in the Builders Labourers’ Case. We do stress that there were only two Justices out of five whose decisions are authorities for the proposition which is put against us. There is one Justice clearly the other way, and two who expressly said that they were not expressing a view on that question.
That takes me to paragraphs 5.8 to 5.11. We simply there adopt again what was said by Justice Brennan in the Builders Labourers’ Case where his Honour described the function as being:
truly appurtenant to the exercise by that court of its judicial power to determine the appeal and to award costs of the appeal.
In other words, the basis for the federal power is that it is incidental to the judicial power otherwise existing.
KIRBY J: That was said in the context of a civil proceeding, whereas at least traditionally the Crown did not seek nor did not pay costs in a criminal proceeding.
MR BENNETT: That is so, your Honour, but that does not prevent the issue being one which as a matter of power is appurtenant to the proceedings. Also this may be one of the areas where one can look at the developments in the law and see a change in the denotation of the various words. While in 1910 the idea of costs in a criminal case may have been unheard of, today it is not a strange concept to lawyers and to society. For that reason, we would submit, when one is looking at whether it is appurtenant, something which might not have been appurtenant in 1910, though I do not concede that, is certainly appurtenant today. We do stress that this argument is in a sense also a fall‑back argument because we would submit it simply does not arise for all the reasons which I have been putting.
The other aspect of this is that, of course, if the effect of a certificate is to achieve nothing, there would be a question as to whether it falls within federal jurisdiction because there would be a question then as to whether there is any matter. So, although we say one can get jurisdiction from the appurtenance and that it is not taken away by the discretion, the fact that it would be useless is something which prevents it being part of judicial power.
CALLINAN J: Mr Solicitor, it confers surely as valuable a right as the declaration in Ainsworth.
MR BENNETT: Your Honour, it confers a right which simply cannot be used for any purpose. There is only one purpose in the certificate and if that purpose is incapable of effectuation, then it does not confer anything. Section 6 of my submissions can be dealt with even more briefly. This is the Melbourne Corporation point. Here we simply say this, that there are a number of issues which arise before one could get to Melbourne Corporation in this case.
GUMMOW J: You would get to Melbourne Corporation if section 3 of the Costs Act was in a federal statute directed to the State administration.
MR BENNETT: Yes, you might then, although ‑ ‑ ‑
GUMMOW J: That would be a collision point.
MR BENNETT: Yes, although even then, your Honour, the fact that the State Treasurer has an ultimate discretion may well mean that nothing has been required of the State. That is 6.5.
The other aspect, which is 6.4, is that if the State Act on its true construction had the effect that it were to apply to federal proceedings, which, of course, is contrary to my submission, but if it were to have that effect, then the State would have, in effect, invited the intrusion. So again there could be no problem.
We accept, of course, that subject to a possible exception under section 78 of the Constitution, the Commonwealth cannot appropriate money from the consolidated revenue fund of a State and that we cannot impose a special burden or disability on a State or prevent it functioning as a government, but there are so many barriers that one has to surmount before one gets to that, that we would submit it simply does not arise. There also may be questions as to what one looks at when one is looking at the imposition of a special burden and whether a general provision picking up various types of State legislation can be said to impose a special burden. There may be an issue about that as well, but that is a long way from, we would submit, arising here.
Finally, may I just make a number of short submissions about the South Australian submission. We, of course, accept Melbourne Corporation and do not seek to challenge it, but the submission raised by the Attorney for South Australia seems to go beyond Melbourne Corporation in an undefined way and seems to suggest that there is some unstated rule which prevents the Commonwealth from enacting laws which have the direct effect of imposing official duties or functions on officers, employees or instrumentalities of another government.
Now, one immediate answer to that, apart from the many exceptions which seem to be listed, is the power, which I do not think this Court has considered – one of the few – in section 51(xi) dealing with “Census and statistics”. One would have thought it would be open to the Commonwealth under that power to require a State to provide, for example, statistics of population or other matters which would be available to the State and which the Commonwealth might require for the purpose of national statistics or censuses. Now, that is simply one example.
There are many, many situations in which the Commonwealth may impose duties on a State to engage in some sort of activity. There are many cases where it happens without the States being singled out, the most obvious one being PAYE tax, where the State obviously has to perform a certain amount of work to comply with obligations under the Income Tax Assessment Act. But, in my respectful submission, there is no such general principle. There are a number of specific principles and, in particular, there is the Melbourne Corporation rule, but if there is some further principle, no one has yet ascertained what it is and we would simply submit that no basis is shown for any such principle and that, in any event, it were a long way from it arising in this case.
For those reasons, your Honours, I cannot conclude in the usual way by saying what I submit the order should be, but I do submit that we simply do not get in this case to the constitutional questions. May it please the Court.
GLEESON CJ: Thank you, Mr Solicitor. Mr Solicitor for Queensland.
MR KEANE: If the Court pleases, we adopt the submissions of the second respondent. We seek to make only a couple of references to the appellant’s submissions in reply in relation to the Melbourne Corporation issue and we appreciate that discussion of the Melbourne Corporation involved a number of assumptions, one of which is that the appellant is not impaled on the other horn of the dilemma, which is that the grant of a certificate means nothing without the exercise of the discretion, which is a real discretion. These submissions proceed on the footing that the Treasurer has no discretion.
In relation to the appellant’s reply, if we could ask the Court to look at paragraph 8 of the written submissions of the appellant in reply, in particular the second sentence where it said:
If such a burden is the result of the valid exercise of a Constitutional power, such as s 77(iii), there will be no room for the operation of any implied constraint which is inconsistent with the express terms of the Constitution.
Might we say that the terms of section 77(iii) do not, in our respectful submission, in any way contemplate the imposition of a burden, much less a burden peculiarly on State treasuries, in respect of the costs of parties to the exercise of federal jurisdiction.
Further, in relation to that sentence in that paragraph, can we make the point that a law may be a law within a specified head of power but, nevertheless, fall foul of the Melbourne Corporation principle and that was, indeed, the very holding in that case. The law in question was a law with respect to banking but it was, nonetheless, invalid because of the operation of the Melbourne Corporation principle.
As to paragraph 9 of the appellant’s submissions in reply, the sentence beginning “Secondly” in particular, the whole point of the appellant’s reliance on the Judiciary Act is that the State law does not, of its own force, apply in federal jurisdiction. Whether a State law applies in federal jurisdiction depends on the Judiciary Act giving it a new operation. That is the way it is put in the applicant’s submissions in‑chief at paragraph 5.43 and that statement is, in our respectful submission, entirely orthodox, being the effect of the decision in Maguire v Simpson where, in addition to the reference made by my learned friend for the third respondent, we would note that it is in Maguire v Simpson that Justice Murphy referred to the effect of section 79 as operating as a surrogate law of the Commonwealth, or, the effect of section 79 is to cause State law to operate as a surrogate law of the Commonwealth. We make that observation as well in relation to what is said in paragraph 6.4 of the written submissions of the Attorney‑General for the Commonwealth.
As to paragraph 16 of the appellant’s submissions in reply where it is said that the picking up of the Costs Act does not control the State of New South Wales, on the assumption that the Treasurer and the Under Secretary have no real discretion in the matter, it is our submission that the certificate is, in effect, a warrant for payment. The warrant for payment depends upon the intervention of federal law or the effect of the warrant for payment in respect of the State Treasury depends upon the intervention of federal law and that offends the proposition that State funds are in the sole and exclusion disposition of State Parliaments or, in this particular case, of the State Parliament, pursuant to section 106 of the Constitution and section 45 of the New South Wales Constitution Act.
KIRBY J: Can I just ask on that, as was said earlier, obviously the enactment of certain federal legislation has very large financial implications for States and imposes on States, in fact, de facto, an obligation to raise the revenue and to secure the revenue from the consolidated revenue of the State in order simply to fulfil the federal legislative requirements. What is the point of distinction between that case and this case where, in effect, the certificate, as you say on the hypothesis you are adopting, is a direct burden on the consolidated revenue? Where does one merge from the one into the other ‑ ‑ ‑?
MR KEANE: Your Honour, with a couple of examples, perhaps. The first example is section 77(iii) itself. No doubt the effect of section 77(iii) of the Constitution is to empower the Commonwealth to make laws obliging the States to make available their courts. It is another thing altogether to say that the States are obliged or could be obliged by a Commonwealth law, purporting to be based on that provision, to in effect underwrite the costs of the parties exercising federal jurisdiction.
KIRBY J: It seems a fairly fine distinction because I know that the States have for years been complaining about the fact that the under the Constitution the Commonwealth can, as it were, impose on the States obligations of federal jurisdiction and that that has very large implications for the availability of State courts and their costs and so on. No doubt it is discussed at Premiers conferences and the like, but I just do not see where the point of principle is.
MR KEANE: Your Honour, sometimes the line might be fine but it is a line that can be drawn, and ought to be drawn. Another example would be in relation to – as in the Australian Education Union; Ex parte Victoria where the Court distinguished between the burden on the State as an employer bound to pay employees under awards made by the Arbitration Commission, or the Industrial Relations Commission, under federal law on the footing that the States operate as employers. That was distinguished from the situation where a federal law might seek to prescribe the number of employees employed at all, or whether they could be made redundant, or the terms of their redundancy. Sometimes, your Honour, it is simply the case that the Commonwealth has to shout.
GUMMOW J: They do shout, do they not, by making grants ‑ ‑ ‑
MR KEANE: Quite, your Honour, and no doubt that is the manner in which the States are – there are some ‑ ‑ ‑
CALLINAN J: You are getting all that GST now too.
MR KEANE: Apparently, your Honour.
KIRBY J: Mr Basten would be entitled to say, “Well, if you grant the certificate and the State Treasury, in fact, has no discretion or feels obliged to pay it, then he can go cap in hand to Canberra and to the Premiers conference and say, ‘Look at this extra burden. You have to indemnify us.’”
MR KEANE: Quite, and it is that ‑ ‑ ‑
KIRBY J: And justice then is done.
MR KEANE: Your Honour, it might be justice but it certainly shows there is a breakdown in the notion of the State’s control, the disposition of the funds in their own treasuries.
CALLINAN J: The Treasurer might say here in this case, as a ground for not paying all of it, or indeed any of it, “There just isn’t enough money in consolidated revenue. The cupboard is bare.”
MR KEANE: In that event, your Honour, the situation might be that the certificate hangs around until there is some more money.
KIRBY J: You say it is a breakdown in the State control of the Treasury but Mr Basten’s client would say, “No, this is the fulfilment of the imposition of the obligation on State courts. It is carrying it through to its very end. It is picking up not only the law and the procedures and so on,
but it is picking up the entitlement to costs in that State, where a State litigant would have exactly that entitlement.”
MR KEANE: Your Honour, it is at that point, of course ‑ ‑ ‑
KIRBY J: I realise that the case is not to be solved at that level of abstraction, but if, in fact, the costs order is part of the criminal proceeding, then it is simply the last step on the road of the criminal trial.
MR KEANE: Your Honour, once again we come back to the point that there is a distinction, which we submit is clear, between orders for costs that may be made inter partes to the lis in federal jurisdiction and special provision made by a State for the payment by the State of the costs of a person who has historically been the successful party to a lis by reference to considerations other than those which normally apply to determine whether a successful party should get his or her costs. These are considerations that take it a long way, in our respectful submission, from justification by reference to section 77(iii) or, for that matter, section 78.
HAYNE J: It might be regarded as ex post facto merits‑tested legal aid rather than a question of costs, Mr Solicitor.
MR KEANE: Quite, your Honour, with respect. Finally and by way of a further answer to your Honour Justice Kirby’s question, if one goes to paragraph 18 in the submissions in reply of our learned friend for the appellant, where it is said that the State legislature remains free from Commonwealth control because it can always tinker with the legislation that it has in place, we submit that to say that is to simply say that if this legislation is given the operation for which the appellant contends, then the State legislature does not remain in control relevantly because it cannot have a law in the terms which it would prefer and which it would make on the footing that if it makes the law in those terms, a federal law may seize upon it to permit access to the State Treasury. That, in our respectful submission, offends the Melbourne Corporation principle, particularly as one sees that principle stated in the excerpts from that case which we have collected in paragraph 20(c) of our submissions. Those are our submissions, if it please the Court.
GLEESON CJ: Thank you. Mr Solicitor for Western Australia.
MR MEADOWS: If it please the Court, my learned friend Ms Pritchard will present the submissions on behalf of the Attorney‑General.
MS PRITCHARD: May it please your Honours. The Court should have before it an outline of written submissions on behalf of the Attorney‑General for Western Australia dated 22 April 2002. We propose to rely on those submissions and to deal very briefly only with three matters.
The first matter to which we wish to briefly refer is the question whether the Commonwealth has legislative power to support section 68 or section 79 of the Judiciary Act to the extent that they purport to apply the Costs Act to a person acquitted of a Commonwealth offence. In our submission, the Commonwealth has no such legislative power. Properly characterised, in our submission, sections 68 or 79 to this extent would be a law which would establish a framework for the making of payments of a particular kind from the consolidated fund of New South Wales to a person acquitted of a Commonwealth offence.
The Commonwealth Parliament, in our submission, has no legislative power to enact an Act which requires the payment of money from the consolidated fund of a State. I understand the learned Solicitor‑General for the Commonwealth to concede that point. To the extent therefore that sections 68 or 79 purport to apply the Costs Act to a person acquitted of a Commonwealth offence, they represent an attempt by the Commonwealth to do indirectly what the Commonwealth Parliament could not legislate directly to do.
KIRBY J: Can you add anything to what the Solicitor for Queensland said of the distinction in principle between directly burdening the consolidated revenue fund of the State and indirectly, necessarily and inevitably burdening it by imposing on the State the obligation to conduct federal trials in its courts?
MS PRITCHARD: In so far as a direct burden is concerned, your Honour, that would be impermissible, other than where there is a constitutional provision, such as section 77(iii), which mandates burdening the State to that extent. To the extent that there is no express provision in the Constitution, then one would need to apply the ordinary Melbourne Corporation principle of looking at questions of degree and whether there was an undue burden or an interference with a State’s capacity to function as a government.
KIRBY J: Has this Court ever said that in those terms, or have the niceties of the dealings between the Commonwealth and the State never presented the issue for ‑ ‑ ‑
MS PRITCHARD: As far as I am aware, your Honour, they have never been presented to this extent. To complete the reference to the Commonwealth’s power, your Honours, you will see in footnote 6 of our submission that we make a reference to Antill Ranger v Commissioner for Motor Transport. Can I direct the Court in particular – although I will not take you to the reference – to page 108, in the judgment of Justice Fullagar, and also to the Privy Council’s approval of that decision in Commissioner of Motor Transport v Antill Ranger (1955) 94 CLR 177, particularly at 180.
McHUGH J: But Antill Ranger is a long way removed from this problem, is it not?
MS PRITCHARD: We point to it only by ‑ ‑ ‑
McHUGH J: I mean, Antill Ranger is a case where the States, having wrongly taken transport fees, then enacted legislation to bar the recovery of them.
MS PRITCHARD: Yes, your Honour. We point to it by way of analogy only, recognising that it does deal with State legislation, but nevertheless deals with a point that we say runs parallel to this one, namely, that one cannot achieve indirectly what one cannot achieve directly. In relation to the Melbourne Corporation points, in relation to the limitation arm of the Melbourne Corporation point, we simply rely on our submissions at paragraph 16 through to 23.
In relation to the impairment limb, we point the Court to the comments in Re Australian Education Union and Ors; Ex parte the State of Victoria and Ors (1995) 184 CLR 188 at 232, to the discussion there by six members of this Court to the fact that it was critical to a State’s “capacity to function” that it be able to determine not only the number and identity of those whom it wished to engage at the higher levels of government, but also to their terms and conditions of employment. In this respect, we point to the fact that the decision‑makers under the Costs Act are persons certainly within the contemplation of the majority of the members of the Court in Re AEU – namely, those at the very highest levels of the Executive Government of the State.
KIRBY J: I think that case is a long way distant from that. No one is interfering with the Treasurer, the head of the Treasury, the Under Secretary or Director‑General; it is simply suggesting that they should exercise a discretion.
MS PRITCHARD: With respect, your Honour, there is an interference, because there is an interference in terms of the functions carried out by those officers. In the same way that if the Commonwealth can dictate the terms and conditions of employment of those officers – if that would interfere with the State’s capacity to function as a government, then it is but a small step further – and, in our submission, an entirely permissible step ‑ to conclude that the Commonwealth cannot dictate what functions those officers will employ.
KIRBY J: But it is already “dictating” it through section 77, by requiring them to make available courts, to provide facilities, to provide sheriff’s officers, and all the other things that State courts have to do.
MS PRITCHARD: Section 77(iii), your Honour, provides a constitutional mandate for that to occur. We are dealing here with the exercise of day‑to‑day functions of these officers at the very highest levels of government. In our submission, they have to be able to exercise their functions exclusively for the State, and without any interference by the Commonwealth.
McHUGH J: I am not sure that is right as an absolute proposition. Take war time, I do not see any reason why the defence power might not extend in certain circumstances to legislation prohibiting even State parliaments from discussing certain matters.
MS PRITCHARD: That deals with the rather exceptional defence power, though, your Honour. With respect, aside from such a possible expansion of the Commonwealth’s ability in war time, in our submission, no such direction to State officers would be possible at the highest levels of government and our submission certainly is confined to officers at that level.
KIRBY J: But even the defence power is subject to this Constitution and the Constitution, as we now know, implied rights of free expression.
MS PRITCHARD: Of course, your Honour. We note here as well, your Honours, that our submissions in this regard run somewhat parallel to the submissions on behalf of the Attorney‑General for South Australia, although, as we understand his argument, it proceeds on the basis of a limitation on legislative power on the part of the Commonwealth in terms of the source of legislative power, whereas our submissions proceed on the basis of a limitation on any existing if any such legislative power exists.
Finally, in relation to the impairment limb of the Melbourne Corporation doctrine, your Honours, may I refer the Court with some page references to comments by members of the Court in the past recognising the importance of a State’s fiscal autonomy. In Melbourne Corporation at pages 52 to 53 in the judgment of Chief Justice Latham, at page 66 in the judgment of Justice Rich, at page 75 in the judgment of Justice Starke and at page 81 in the judgment of Justice Dixon there were various recognitions of the importance of the States’ capacity to raise money by taxation to make provision for the custody, management or disposition of funds and ‑ ‑ ‑
McHUGH J: They are referred to in Queensland’s submissions, are they not, I think?
MS PRITCHARD: They are, your Honour, I think, as well, yes.
Finally, your Honours, in relation to section 45 of the New South Wales Constitution Act, recognising the submissions of Queensland which run parallel to those in our submissions, we simply direct the Court’s attention to paragraphs 44 through to 47 of our submissions and we rely on those. May it please the Court.
GLEESON CJ: Thank you, Ms Pritchard. Mr Solicitor for South Australia.
MR SELWAY: Your Honours, our submissions are directed to the question of whether the Commonwealth could legislate so as to impose upon the Under Secretary and the Treasurer those duties that they have under sections 4(3) and 4(5) of the Costs in Criminal Cases Act.
It may be that your Honours will not get to that point in the sense that I understand the appellant does not argue that section 4 in its own terms is picked up and applied as a Commonwealth Act and nor, it appears, does anybody else. That being the case, the argument that we put may not arise. Nevertheless, the submission we put is that the Commonwealth lacks any relevant legislative power to impose such duties upon State officials. We say that arises necessarily out of the Federation. We say it is clear that such a principle would apply in relation to a State attempt to confer such duties upon a Commonwealth officer, and this Court so held in R v Hughes in the joint judgment, (2000) 202 CLR 535 at 553 paragraph 31. As to the States, there is no authoritative decision in relation to the principle. It was left open in Re Cram (1987) 163 CLR 117 at 127 to 128. We say, nevertheless, that the same principle as applies to the Commonwealth would apply to the States, but with some qualifications.
Your Honours, we say that the operation of the Australian Federation in this regard can be perhaps seen by comparing other Constitutions. In the United States Constitution, in the recent case of Printz v United States (1997) 521 US 898 – I do not need to take your Honours to it - the case concerned the Brady gun law, and as part of the administrative machinery for that law the law provided that local police officers, most of whom were employed by counties, should have a role in certifying various matters and things. The question was the validity of that law. Justice Scalia delivered the opinion for the majority. There were three aspects of his Honour’s reason. One of them referred to the constitutional history in the United States; another referred to the previous decisions in the United States; but more importantly, for our purposes, his Honour referred to the constitutional context and what that meant. Your Honours will find that at pages 918 to 923. I do not need to take your Honours to it, except to say that his Honour identified the separate sovereignty of the States, the separate legal systems of the States, to come to the conclusion it created two distinct governments and that, as a result of those two distinct governments, there were limitations upon the power of the federal government to impose duties upon State officials.
Those reasons were, of course, rejected in the Engineers Case. On the other hand, the distinct nature of the Australian States and the federal government is clearly recognised within Chapters II and III and, in particular section 75 and your Honours have on occasion drawn attention to the fact that it is unnecessary within the Australian constitutional context to talk of the Crown for the simple reason that the distinct nature of the polities is created by the Constitution itself. The contrast again can be made with perhaps ‑ ‑ ‑
KIRBY J: We keep on hearing, though, the “Crown in right of the State”.
MR SELWAY: We are trying very hard to learn, your Honour.
KIRBY J: It would take the Bar table a long while to get rid of these things.
MR SELWAY: Again, that could be contrasted, perhaps, with the Indian Constitution. Section 258 of the Indian Constitution makes express provision for the Indian government to be able to confer functions upon the States and their officials, makes provision for the payment of moneys and provides expressly for ‑ ‑ ‑
GUMMOW J: They suspend State governments, do they not?
MR SELWAY: Yes, your Honour. I am not suggesting, by any sense, that it is analogous, I merely make the point ‑ ‑ ‑
GUMMOW J: All I am saying it is a much stronger federation, in that sense.
MR SELWAY: Yes, your Honour. In fact, they describe themselves as much more co‑operative.
HAYNE J: There is not much choice, is there.
KIRBY J: You have to be co‑operative. Are you suggesting we should find it implied for that purpose?
MR SELWAY: No, your Honour, I merely make the point that there is a Constitution which has an express provision enabling, within a federation, the federal government to confer functions upon States and makes provisions in that regard. Within the Australian Constitution there are express provisions, section 77(iii), section 120 and probably section 78, by which functions can be imposed upon the States and their officers. Even within that context there are limits, for example, section 77(iii) has been understood as requiring the Commonwealth to take the State courts as it finds them. It cannot reconstruct them, it cannot confer functions upon the officers which are inappropriate to their function as State officers.
There are other powers which one might necessarily, or impliedly, read as exceptions to the general rule. The defence power is one. There may be others. We say, as a general proposition, Commonwealth power does not authorise the unilateral conferral of functions upon State officers. The only we are aware of which seems to deal with that as an issue is The Commonwealth v New South Wales (1923) 33 CLR 1, a decision about three years after Engineers. That case concerned the Commonwealth Land Acquisition Act 1906 and most of the case concerned the nature of that Act and what was acquired. One of the questions in it was the validity of section 20 of that Act which required the New South Wales Registrar‑General to register a notification given to him by the Commonwealth of the acquisition.
Justice Isaacs, at page 54, dealt with the question of the validity of section 20, at about point 2:
In any case sec. 20 of the Act, purporting to require the State officer to treat the copy notification as a State instrument, is invalid. It is, of course, not pretended that, unless expressly authorized, the Commonwealth Parliament can directly repeal or amend State legislation. Where competent, either by concurrent or exclusive powers, Commonwealth Acts repugnant to any State law prevail. Sec. 20, however, is really an amendment of the Real Property Acts of the States, and is a command to a State official as such in the performance of his State functions to disregard the conditions of his statutory authority and to act in accordance with Commonwealth directions. His action is a State service, not an individual service. Sec. 20 attempts to create, not a new individual duty on the part of an inhabitant of the Commonwealth, but a new State governmental duty towards the Commonwealth. In the circumstances here appearing, that is not warranted by any provision of the Constitution, and the attempt fails.
One cannot take it too far. It is simply a limitation on the acquisition power.
GUMMOW J: But the Commonwealth may acquire title to land under the Real Property Act, may it not?
MR SELWAY: It may, your Honour. The problem with section 20 was not anything other than its attempt to impose a duty upon the registrar‑general in that capacity to do something.
KIRBY J: As distinct from taking your place in the queue and paying your fee and having it done.
MR SELWAY: Maybe they did not even need to pay the fee - that may be another issue - but as a State officer his duty was to comply with the State Act, the Real Property Act. If the Commonwealth came along to register their title, they were entitled to be registered but what they were not entitled to do was to required him to carry out a Commonwealth function. We say, with respect, the same principle applies generally, that the Commonwealth cannot impose such duties, and if the Commonwealth had purported to do so in this case it would have been invalid.
Your Honours, the only other matter is that in relation to the power to enact section 79 of the Judiciary Act, we would adopt, with respect, the written submissions of my learned friend Mr Gageler. May it please the Court.
GLEESON CJ: Thank you, Mr Solicitor. Yes, Mr Basten.
MR BASTEN: Your Honours, might I address first the argument that the State Act becomes something else, something other than a State law when it is binding by virtue of the operation of a Commonwealth law on a court exercising federal jurisdiction. Section 79 opens with the words, “The laws of each State”. That must be a reference to a law as passed by a State Parliament and a law which is subject to the control of the State Parliament by amendment or appeal as occasion may arise.
Section 79 does not have the effect that that law becomes anything other than the law of the State which enacted it in the first place. That has two consequences. One is that when one construes the State law so as to deal with questions such as the interpretation of section 4 in the Costs Act which refers to certificates “granted pursuant to this Act”, one takes the law to mean what it says, namely that the certificate is and remains, even in exercise of federal jurisdiction, a certificate granted pursuant to the State law.
Were it otherwise, where a person, perhaps a woman subject to domestic violence who has fled to Queensland, were to bring proceedings in the summary jurisdiction for an assault under a New South Wales law, the argument would be put that she or he in New South Wales would not be entitled, after successfully resisting the prosecution, to a certificate because the certificate has been granted in the exercise of federal jurisdiction pursuant to a Commonwealth law and not the State Act.
GLEESON CJ: There was a concession attributed to you in argument, and I am not sure whether that was accurately attributed. Do you say that section 4 of the Costs in Criminal Cases Act is picked up section 79?
MR BASTEN: Not in its operation in relation to this proceeding and ‑ ‑ ‑
GLEESON CJ: Is it picked up in its operation in relation to the Under Secretary or the Minister?
MR BASTEN: Yes.
GLEESON CJ: Section 4(3) imposes an obligation on the Under Secretary. Is that picked up by section 79?
MR BASTEN: Section 4 does and it has that effect, regardless of whether any proceedings are brought. If the Under Secretary declines to make the statement and proceedings are brought, the point I was seeking to make was that whether or not section 79 picks up section 4 will depend upon whether an application for mandamus in the Supreme Court to enforce the obligation under section 4 includes or engages federal jurisdiction or not. If it does, yes; if not, no, it does need to.
GLEESON CJ: But what are the words of section 79 that would pick up section 4(3), that is, the obligation on the Under Secretary to do something?
MR BASTEN: If because the certificate relates to federal jurisdiction, the proceeding against the Under Secretary becomes a proceeding within federal jurisdiction, then his or her obligation depends upon a State law applied in federal jurisdiction by section 79.
GLEESON CJ: And so it is the words “binding on all Courts” that pick it up.
MR BASTEN: Yes, your Honour.
GLEESON CJ: And it is binding on the court that deals with the application for mandamus; that is the way your argument operates?
MR BASTEN: Yes, that is so.
GLEESON CJ: Well now, how do you apply that to the Minister exercising his discretion.
MR BASTEN: The Treasurer, your Honour?
GLEESON CJ: The Treasurer, yes.
MR BASTEN: In the same way, your Honour; he or she is bound to exercise the power conferred under 4(5) in accordance with law. The mandamus proceeding presumably asserts that there has been a failure to act according to law; the law which is to be applied, again if the origin of the certificate leads to the conclusion that the mandamus proceeding is in federal jurisdiction, is binding on the Supreme Court in the same way, namely, as a law of a State which is binding in the exercise of federal jurisdiction.
GLEESON CJ: This is what Justice Gaudron was taking up with you as your expanded Evans Deacon argument.
MR BASTEN: Yes, your Honour. But on one view one does not get to that because the mere fact that the certificate was granted under section 2 in relation to an exercise of federal jurisdiction, does not mean that everything which follows under section 4 can only have effect in federal jurisdiction if it is necessary to bring proceedings to enforce the obligations.
But neither does it mean, we would say, that there is no utility, because a certificate granted in the exercise of federal jurisdiction cannot have the meaning of a certificate granted pursuant to this Act in 4(2), which is the argument put against us. The question of what is picked up in these proceedings, in order to refer to the argument suggested, I think, to my learned friend, Mr Gageler, by your Honour Justice Callinan, that section 3A could not be picked up by reference to the power of the Minister to be given an opportunity to appear, with respect, we see no reason why that should not be so, your Honour, and the same would apply in my cross‑State diversity jurisdiction case. The Minister referred to is, of course, the State Minister; his or her power to appear in such proceedings cannot, on the assumption that we are dealing with federal jurisdiction, depend upon State law, but the Commonwealth can pick up and give the Minister that power and that would be what happened, so that ‑ ‑ ‑
CALLINAN J: The Minister would be representing the Commonwealth then.
MR BASTEN: With respect, no, but the Minister would be ‑ ‑ ‑
CALLINAN J: Well, he would be speaking for the benefit.
MR BASTEN: No, because if the certificate is granted only – the Commonwealth would never ‑ ‑ ‑
CALLINAN J: Quite.
MR BASTEN: ‑ ‑ ‑ have a legal obligation in relation to it. Thirdly, may I briefly advert to the argument put by, I think, Mr Gageler to the effect that the opening words of section 2, using the phrase, “in any proceedings”, merely identifies the court ‑ ‑ ‑
CALLINAN J: Mr Basten, just coming back to what you put to me though, the Costs Act brings into question – and I use this term broadly – the propriety of the bringing of the prosecution, or it may do so.
MR BASTEN: Yes.
CALLINAN J: Now, a State Minister would have no interest in that at all.
MR BASTEN: Until concerned about the need to find the funds for the costs.
CALLINAN J: Yes, but there is a further question over and beyond the costs. I mean it might be a very controversial case with political implications, for example, and the State Minister might be very anxious to distance himself from the prosecution.
MR BASTEN: He need not appear, your Honour. He has no obligations under ‑ ‑ ‑
CALLINAN J: Yes, but if he does not, he might have to find, on your argument, a great deal of money to fund something that should never have happened.
MR BASTEN: That is a strategic consideration, your Honour. It does not necessarily lead to the conclusion that the Commonwealth cannot give him the right to appear if he wishes to.
CALLINAN J: No, but it makes your reading just a little less likely; that is what I am suggesting.
MR BASTEN: Your Honour, when the Act was enacted it did not have 3A. What I was suggesting in argument was that one significant purpose of 3A was presumably to allow the defendant, who never got to the box or called his alibi, to present that material to show that had the prosecution known about it, they would not have proceeded against him and that he might have been reasonable in not supplying it earlier.
Now, those are matters which are covered by 3A. It does not follow that the whole nature of the proceedings has been changed in some way by providing him with that opportunity. He did not exercise it in this case; 3A was not engaged. But if it had been, we would respectfully submit that the nature of the proceeding identified and the jurisdiction exercised in section 2 would not be changed.
Now, I know that may not be a complete answer to the point your Honour is making, but it really becomes a question as to whether the tail of section 3A wags the dog of section 2, we would say, inappropriately.
CALLINAN J: It is inconvenient for you, though, to put it at its lowest, perhaps.
MR BASTEN: On a construction basis, yes, I accept that and I think that was what the Chief Justice was putting to me this morning. It appears to have a wider operation on one view of it at any rate than would otherwise have been the case. The argument your Honour is putting to me presumably undermines to an extent the point I was seeking to make in relation to section 2 which is that the phrase “in any proceedings” is not intended simply to identify a Court which has heard a case, but to identify the proceedings in which the Court is engaged and in our submissions, at paragraph 5.54, we seek to respond to Mr Gageler’s submissions in that regard.
May I make a number of very short points. Firstly, Allerton in the Court of Appeal of New South Wales in 24 NSWLR did not have to deal with the Manley question as to whether the Court could be reconstituted after the judge in question had departed for some reason, but one would think that it is the arguments which are dealt with at pages 554 to 555 strongly suggest the contrary view to that adopted by the majority in Manley.
GLEESON CJ: It is a consideration of considerable practical importance in times of acting judges.
MR BASTEN: Yes, indeed. I was merely going to add by way of completeness that there is, of course, the reference at 555B to:
the common law principle that –
where the judge is unavailable, the –
court must of necessity have jurisdiction to appoint –
someone else. Then the question simply becomes whether there is some constraint in the Costs Act which would prevent that occurring in the present case. Wentworth v Rogers (No 3), which is referred to in that paragraph, involved the judgment, I think, of your Honour Justice Kirby when on the Court of Appeal setting out in some ‑ ‑ ‑
KIRBY J: Yes, I sat in many of those cases.
MR BASTEN: Well this is number 3. I know it got to number 9, at least, your Honour.
KIRBY J: It would be much more than that; they just were not reported after number 9.
MR BASTEN: Fifteen perhaps; can I merely say that (No 3) is the only one I am interested in and that your Honour set out in some detail the principles which are adverted to very briefly there in relation to replacement of judges.
In relation to the Solicitor for South Australia’s reference to Printz v United States, we merely say that that involves an imposition of executive power on the States of the United States and therefore is not directly of assistance in relation to Chapter III. Might I in responding to that take the opportunity simply to clarify a point I stumbled over this morning, with the leave of the Court. My reference to section 79 perhaps being declaratory, was intended to pick up a comment by Chief Justice Griffith in Federated Sawmill, Timberyard Case 15 CLR 312 to 313, and the point is made somewhat more succinctly by a Mr Renfree in his book, “The Federal Judicial System of Australia”, pages 674 to 675, and I will provide the Court with a copy of those pages. I was simply seeking to incorporate into that idea the fact that covering clause 5 was the source of the integrated federal system in relation to he exercise of federal jurisdiction.
While I am handing up additional material, could I also provide, in answer to your Honour Justice Callinan, section 9 of the Director of Public Prosecutions Act 1986. I understand the way your Honour put the matter, there is power to take over prosecutions, including in summary jurisdiction, but it is not a universal power.
Finally, your Honours, if I might have leave, might I make one submission in relation to costs. The orders that the appellant sought are set out in the normal way in our written submissions at page 20, I think, and
might I make the additional submission that this case has involved novel issues as to the interrelationship of Commonwealth and State laws and powers on which those entities themselves do not fully agree. If the appellant is unsuccessful in this novel test case, which has no further interest to him but may have very considerable further interest to those other parties, he should not bear the costs of the State or the Commonwealth as parties to the appeal.
GUMMOW J: You carried the costs in the Court of Appeal, did you not?
MR BASTEN: There is an issue about costs in the Court of Appeal, your Honour, which is unresolved, but there was an order ‑ ‑ ‑
GUMMOW J: I am just looking at page 80, that is all.
MR BASTEN: I know, there was an order.
GUMMOW J: There was an order?
MR BASTEN: There was an order.
GUMMOW J: You would not seek us to disturb that?
MR BASTEN: I have not sought it, your Honour, if the appeal is unsuccessful.
KIRBY J: I just did not quite understand your submission. You said not carry the costs of the States or the Commonwealth. What about the third respondent, the Queen?
MR BASTEN: I am sorry, I meant to refer to the parties rather than the interveners.
KIRBY J: In other words you submit to the orders in the event that the appeal is not successful, that you have to pay the third respondent’s ‑ ‑ ‑
MR BASTEN: No, your Honour. I am sorry. Obviously there would normally be no order as to the costs of the interveners. My submission is simply that the parties should bear their own costs if the appeal is unsuccessful. Those are my submissions.
GLEESON CJ: Thank you, Mr Basten. We will reserve our decision in this matter.
AT 4.22 PM THE MATTER WAS ADJOURNED
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Judicial Review
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