Sydney Water Corporation Ltd and Another v Industrial Relations Commission of NSW and Another

Sydney Water Corporation Ltd and Another sought judicial review of a decision by the Industrial Relations Commission of New South Wales. The dispute concerned the Commission's jurisdiction under section 106 of the *Industrial Relations Act 1996* (NSW) to grant relief in relation to contracts. Sydney Water contended that the Commission had erred in law by interpreting section 106 too broadly, and sought a declaration to that effect.

The primary legal issue before the Court of Appeal was the proper construction of section 106 of the *Industrial Relations Act 1996*. Specifically, the court had to determine whether the Commission's power to grant relief under that section extended to situations where the unfairness arose from conduct in breach of the contract, or whether the contract itself had to be found to be unfair according to the definition in section 105 of the Act. The court also considered whether the Commission's decision involved a jurisdictional error, which would warrant the grant of prohibition or declaratory relief.

The Court of Appeal, comprising Mason P, Hodgson and McColl JJA, reasoned that section 106 of the *Industrial Relations Act 1996* conferred jurisdiction on the Commission to grant relief only where the contract or arrangement in question was, or had been found to be, an "unfair contract" as defined in section 105. The court held that the definition of "unfair contract" in section 105 was a prerequisite for the exercise of the Commission's powers under section 106. Therefore, unfairness arising solely from a breach of contract, without the contract itself being found unfair, did not fall within the Commission's jurisdiction under section 106.

The Court of Appeal declared that section 106 of the *Industrial Relations Act 1996* does not permit the granting of relief unless the contract or arrangement otherwise falling within that section is, or is found to have become, an "unfair contract" as defined in section 105 thereof.