Thursday, December 23, 2010

New HCA Judgments: Rowe, Aktas, SZJSS and TEC Desert

Four new High Court Judgments handed down. [[Sorry for the delay in posting but I have been one of those affected by the snow in the UK.]]

Rowe v Electoral Commissioner [2010] HCA 46

The decision in this matter was handed down back in August, but the Court reserved their reasons for decision until now.

The High Court (French CJ and Crennan J each provided separate reasons and Gummow and Bell JJ delivered joint reasons; with each of Hayne J, Heydon J and Keifel J providing separate reasons in dissent) has declared legislation constitutionally invalid which had provided for shortened deadlines for the period in which people who are eligible for voting can register to vote. The plaintiffs were members of the 100,000 or so estimated to have been prevented from registering on account of the legislation.

The Question for the Court was the extent to which restrictions on voter registration may fall short of the constitutional requirements of representative government – which is protected by such phrases in the Constitution as, inter alia, "directly chosen by the people" (s 7 and 24). The plaintiffs argued that the exceptionally short period of time between when an election is called and when the registration for voting closes, represented such an unconstitutional restriction on representative government. This was said to be so notwithstanding that those affected always had an opportunity to enrol earlier.

The High Court confirmed the test in the previous case of Roach, which says that, first, regard must be had to the practical operation and effect of the legislation to determine whether there has been a disqualification from voting and, secondly, it must be determined whether there was a “substantial reason” for the disqualification. A substantial reason would be satisfied if it is “reasonably appropriate and adapted to serve an end which is consistent or compatible with the maintenance of the constitutionally prescribed system of representative government”. The Court found that the legislation placed an unconstitutional restriction on the registration of voters and that such a restriction was not reasonably appropriate and adapted to serve a legitimate electoral purpose.

It is not entirely clear the extent to which the majority in this case deals with ‘barriers’ to voting as opposed to clear disqualification. Notably the majority opinion espoused by Gummow and Bell JJ seemed to accept that the plaintiffs had been ‘disqualified’ from voting at the election (at [154]), rather than that they were merely hampered by the reduced period for enrolment. Similarly, Crennan J said that the legislation created a restriction because it operated to ‘disentitle or exclude’ potential voters. Accordingly, the decision may not offer much assistance in determining what obstacles to enrolment (which fall short of disqualification), if any, may prove unconstitutional. Except that the case shows that a person may be practically disqualified notwithstanding some way in which the the restriction could be avoided. French CJ took a more robust approach, balancing the positive and negative effects of the legislation on the entitlement to vote and  seemed to consider it sufficient that the legislation ‘diminished [pre-existing] opportunities for enrolment’ (at [78]) rather than that there was a complete disqualification.

Aktas v Westpac Banking Corporation Limited [2010] HCA 47

This relates to the decision from earlier this year in Aktas v Westpac Banking Corporation Limited [2010] HCA 25. This decision dismisses an application to amend a costs order made in light of certain Calderbank offers of which the Court was not aware. The decision is entirely uninteresting and is probably only given a citation because of Heydon J’s five paragraph lecture on how counsel should be prepared with instructions for argument even if they are ‘only’ taking judgment.

Minister for Immigration and Citizenship v SZJSS [2010] HCA 48

The High Court has unanimously allowed this appeal from the Full Court of the Federal Court of Australia.

The respondents are immigrants from Nepal seeking refugee status on account of purported persecution as a teacher in Nepal, from both Maoist and Nepalese forces. At a hearing before the Tribunal, the respondents provided letters which corroborated their oral evidence about the persecution of school teachers in Nepal. The Tribunal said that they gave the letters ‘no weight’ and referred to the oral evidence as a ‘baseless tactic’. In judicial review proceedings in the Federal Court, the Court concluded that the Tribunal had fallen into jurisdictional error by dealing with the evidence in this manner and that the terminology adopted would lead to a reasonable apprehension of bias.

The High Court found that there was no jurisdictional error and no apprehended bias. Their Honours said that the amount of weight to be given to the letters was a matter for the Tribunal and the decision not to accept them was an acceptable exercise of its function. Similarly, the use of the terminology ‘baseless tactic’ when understood in the context of the Tribunal’s reasons, did not amount to unreasonableness in the manner required for a jurisdictional error, nor did it provide an apprehension of bias.

TEC Desert Pty Ltd v Commissioner of State Revenue [2010] HCA 49

The High Court has unanimously allowed this appeal from the Western Australian Court of Appeal.

In this case a company, WMC, sold its mining operations to the appellant, TEC. The agreement by which it did so provided for a conveyance of mining assets to TEC with a retention by WMC of certain assets which were referred to in the agreement as fixtures. Those fixtures were defined as ‘affixed to land, and an estate or interest in which is therefore an estate or interest in land’, and were to be licensed to TEC under the agreement. The Commissioner of State Revenue charged stamp duty on the agreement for the value of the fixtures as a conveyance of land.

The High Court determined that Stamp duty was not chargeable on the so called fixtures as this did not amount to a conveyance in land. In relation to some of the fixtures on land, WMC did not actually hold title to the land and so by virtue of the legal status of the rights it held (mining rights), it did not transfer land by the sale of rights in relation to those fixtures. In relation to the balance of fixtures the Court determined that although the assets were referred to in the sale agreement as fixtures, the agreement displayed that the parties had made an assumption that WMC had distinct title to the relevant fixtures as chattels, notwithstanding their affixation to the land. Accordingly, the affixations were not fixtures in the technical Property Law sense and there was therefore no conveyance of land.

Unfortunately this conclusion meant that the Court avoided the most interesting issue in the case, namely the effect of a purported sale of unsevered fixtures with retention of the rest of the land (or a sale of freehold land, with retention of title to unsevered fixtures). There has been ongoing uncertainty in this area and it would have been helpful to have had some clarification.

Wednesday, December 8, 2010

New HCA Judgments: Port of Portland and Hili & Jones

Two new judgments handed down in the High Court today. They were:

Port of Portland Pty Ltd v Victoria
[2010] HCA 44

The High Court has unanimously allowed this appeal against a decision of the Court of Appeal of the Supreme Court of Victoria.

The appellant was a private company that purchased the land and operations of a government owned port as part of a privatisation move by the Government of Victoria. The Treasurer, on behalf of the Government was a party to the contract. Under the contract the Government agreed to (a) pass legislation in certain terms (the effect of which it was hoped would allow the appellant to avoid tax which would otherwise be payable), and (b) if it failed to pass such legislation to pay the tax for the appellant. Certain legislation was passed but it failed to avoid altogether the tax of the appellant and the appellant sought recovery of the tax. The Government argued that the clause was void as a clause attempting to bind the state to pass legislation and therefore fetter the legislative role.

The High Court considered that the only role of obligation (a) in the circumstances was to determine in what circumstances the Government would be liable under obligation (b). Accordingly, it was unnecessary to consider whether obligation (a) was validand enforceable in its terms. Obligation (b) was therefore operative as it merely required the Government to pay a certain sum upon a certain event. The Court then determined that the legislation which was passed did not meet the requirement in obligation (a) and remitted the matter to a trial judge to quantify the amount due.

Hili v The Queen; Jones v The Queen [2010] HCA 45

The High Court (Heydon J dissenting on one point) has dismissed this appeal against a decision of the Court of Criminal Appeal of New South Wales.

The appellants pleaded guilty to a number of charges relating to a tax evasion scheme, which was the subject of the ‘Project Wickenby’ crack down. On an appeal against sentence the Court of Criminal Appeal increased the sentence on the ground of manifest inadequacy. In doing so they said that the 'norm' for a non-parole period is between 60 and 66% of the head sentence for federal crimes.

Although the High Court ultimately dismissed the appeal, finding that the Appeal Court was correct to increase the sentences, their Honours gave some important rearticulations of sentencing principles. Their Honours said that the Appeal Court was wrong to have regard to a mathematical percentage as the 'norm' for setting a non-parole period. Their Honours said (at [18]):

[T]he consistency that is sought [in sentencing] is consistency in the application of the relevant legal principles, not some numerical or mathematical equivalence. Consistency in sentencing federal offenders is achieved by the proper application of the relevant statutory provisions, having proper regard not just to what has been done in other cases but why it was done, and by the work of the intermediate courts of appeal.
Their Honours also rejected an argument that the Court of Appeal had given insufficient reasons for determining an aspect of the appeal.

Friday, December 3, 2010

New HCA Judgments: Aid/Watch and Henschke

Two new judgments handed down in the High Court.

Aid/Watch Incorporated v Commissioner of Taxation [2010] HCA 42

The High Court has allowed this appeal against a decision of the Full Court of the Federal Court of Australia.

For detail, see Alex's post on the case here. This was a test case concerning whether certain benevolent societies who are involved in political action for law reform can have tax exemptions as 'charitable institutions'. The Court found that involvement in the political process to foster legislative change is not necessarily inconsistent with an institution coming within the common law definition of charity.

Commissioner of State Taxation v Cyril Henschke Pty Ltd [2010] HCA 43

The High Court has allowed this appeal against a decision of the Full Court of the Supreme Court of South Australia.

Doris Henschke was a partner of Henschke Wines. when she decided to retire, she signed a retirement deed with the partners and the value of Doris' share in the business was paid out to her. The Commissioner of Taxation imposed stamp duty on the deed, arguing that it reflected a "conveyance on sale" within the meaning of s 60 of the Stamp Duties Act (SA). The Full Court said that the retirement payment did not effect any 'transfer' of Doris' interest, rather that interest simply ceased by virtue of the 'satisfaction' of her chose in action against the partnership.The High Court disagreed. Their Honours concluded that because the retirement of a partner necessarily causes a dissolution of the partnership and a creation of a new partnership, without the retiring partner, there is accordingly a transfer of assets to the new partnership. Consequently there was a 'conveyance' and stamp duty was payable.

Thursday, November 18, 2010

Nevember Special Leave Rundown... so far

The High Court hasn't yet released its official list of cases for which special leave was granted on Friday. But at least some of the transcripts are up on Austlii (thanks for the heads up from Jeremy Gans). So the list (so far) is as follows:

Stoddart v Boulton [2010] FCAFC 89

Leave was granted in an appeal from the Full Court of the Federal Court.

This case concerns the Australian Crime Commission's power to compel answers to questions relating to serious Commonwealth crimes under s 30 of the Australian Crime Commission Act 2002 (Cth). Specifically, Mrs Stoddart is claiming that she can avoid answering questions relating to her husband under the protection of spousal privilege. The Full Court found that spousal privilege was not necessarily excluded by operation of the Act, upholding Mrs Stoddart's claim for privilege.

Poniatowska v Director of Public Prosecutions (Cth) [2010] SASCFC 19

As predicted, leave to appeal from this decision of the Full Court of the South Australian Supreme Court was referred to an enlarged bench of the High Court (see some background in our previous post here).

The case concerns the elements that need to be established by the prosecution in a charge of obtaining a financial advantage from the Commonwealth (knowing that there was no entitlement to such an advantage etc) contrary to s 135.2 of the Criminal Code (Cth). It is a classic case of failing to inform Centrelink of certain income. The Full Court set aside the convictions on the ground that no obligation to inform Centrelink of a change in circumstances had been established. (The reasoning of the majority, in my opinion, is quite strong on a strict interpretation of the legislation, so the case must come down (which Sulan J concluded in dissent) to the extent that the intended operation of the legislation will prevail over shockingly poor drafting.)

Insight Vacations Pty Ltd v Young [2010] NSWCA 137

Leave was granted to appeal from this decision of the New South Wales Court of Appeal.

The case involves a woman who was injured while travelling in Slovakia. She sued her travel company in Australia in tort and contract. The trial judge found the travel company liable for breach of contract for failing to exercise due care, contrary to a term of the contract implied by s 74(1) of the Trade Practices Act 1974 (Cth) ("TPA"). In so finding, the trial judge declared an exclusion clause of the contract void because it purported to exclude the operation of the TPA (contrary to s 68 of the TPA).

There are two principal issues in the case. First, the case concerns whether s 5N of the Civil Liability Act 2002 (NSW), a NSW provision which preserves the ability to waive the contractual requirement for due care in contracts for 'recreational activities', is inoperative as it is inconsistent with s 68 of the Trade Practices Act 1974 (Cth), a Commonwealth provision which invalidates any term purporting to exclude a provision of that Act. Secondly, the case concerns whether 'disappointment loss' for breach of contract comes under the definition of 'non-economic loss', and is therefore subject to limitations under s 16 the Civil Liability Act 2002 (NSW).

Thursday, November 11, 2010

New HCA Judgments: Totani, Anstis and M69 of 2010

Three new judgments handed down today. These three cases are probably among the three biggest cases of the year (well, at least Totani and M61). Given the complexity and importance of each of these cases, I will only be able to state here the general outcome of each case, but we'll have some commentary up soon:

South Australia v Totani [2010] HCA 39

The High Court (Hayne Heydon J dissenting) has dismissed this appeal against a decision of the Full Court of the Supreme Court of South Australia.
This is the case that Constitutional lawyers have beeen waiting for all year, not least because we all knew that the appeal would be dismissed (at least since the Court asked for further particulars of how it might dismiss the appeal). The case deals with the issue of the validity of control orders under the Serious and Organised Crime (Control) Act 2008 (SA) (i.e. the bikie legislation). The question is the degree to which a Supreme Court of a State can make an order, the subject of which is dictated by the executive (i.e. contrary to Kable). The impugned legislation required the Court to make a determination that individuals were subject to control orders if they are a member of a group which the executive had declared to be a declared organisation. The High Court has held that the Supreme Court of South Australia was correct in determining this to be contrary to the institutional integrity of a Court and therefore constitutionally invalid.

Commissioner of Taxation v Anstis [2010] HCA 40

The High Court has dismissed this appeal against a decision of the Full Court of the Federal Court of Australia.

I have previously set out the findings of the Full Court in some detail, here. The issue is whether a student on Centrelink payments (specifically Youth Allowance) is able to deduct her expenses as an expense for "the purpose of gaining or producing assessable income". The Court dismissed the appeal from the Full Court finding that such a deduction was valid.

Plaintiff M61/2010E v Commonwealth of Australia [2010] HCA 41

The High Court has [allowed (though dismissed in part) an application for judicial review in the High Court's original jurisdiction]. this application.

This case concerned the offshore processing procedures of immmigrants currently being engaged by the Australian Government. The High Court has determined that the offshore processing procedure does not - contrary to popular Governmental belief - insulate or immune the Government from requirements of the Migration Act 1958 (Cth) and administrative principles of procedural fairness.

Thursday, November 4, 2010

New HCA Judgments: Selected Seeds v QBEMM, and R v Nguyen

Two new decisions were handed down by the High Court yesterday. Both were unanimous. They were:

The Queen v Nguyen [2010] HCA 38

The High Court unanimously allowed this appeal against a decision of the Court of Appeal of the Supreme Court of Victoria.

The respondent was found guilty by jury of murder and attempted murder by complicity in relation to an attempt to collect on a drug debt. The Court of Appeal quashed those convictions on the grounds that the verdicts were “unsafe and unsatisfactory” in the sense that the verdicts were unreasonable or could not be supported having regard to the evidence. The prosecution appealed this decision to the High Court and submitted that, applying well-established principles to the facts of this case, it was open to the jury to convict the respondent of both murder and attempted murder. The High Court unanimously agreed with this submission.

In so doing, the Court held that this was an exceptional case in which the prosecution should have special leave to appeal against the orders of an intermediate court quashing a conviction by a jury and directing entry of a verdict of acquittal. The Court decided that it was in the interests of the justice generally, and in the interests of justice in this particular case, that the error made by the Court of Appeal be corrected.

However, the respondent submitted that his application for leave to appeal the Court of Appeal should have succeeded on a ground alleging misdirection of the jury in relation to the availability of the charge of manslaughter. The Court agreed that the trial judge’s directions to the jury were erroneous, and, due to this error, held that it cannot be said that there was no substantial miscarriage of justice to the respondent in not leaving manslaughter as an available verdict. The Court held that this misdirection required that the respondent’s application for leave to appeal to the Court of Appeal be granted, the appeal allowed, his convictions quashed, and an order that a new trial be had.

In its orders, the Court granted both parties special leave to appeal or cross-appeal as the case requires, treating the appeal and cross-appeal as instituted and heard instanter, and allowed the appeal and cross-appeal. In sum, the Court made those orders which it held the Court of Appeal should have made. Finally, the Court noted that any decision further to prosecute the respondent was a matter for the DPP.

Selected Seeds Pty Ltd v QBEMM Pty Limited [2010] HCA 37

The High Court unanimously allowed this appeal against a decision of the Court of Appeal of the Supreme Court of Queensland.

This case is about seeds, grass, and the proper construction of an “exclusion clause” in an insurance policy. In essence, the appellant, Selected Seeds Pty Ltd, is a grain and seed merchant who had purchased grass seed from a third party. This seed was contaminated by an inferior seed and largely not the type it was represented to be. Eventually, this seed reached R and J Shrimp, who instituted proceedings in the Federal Court in 2006 claiming damages. Although these proceedings were ultimately settled in 2008, the appellant’s insurers, the respondents in this case, refused to indemnify the appellant for that loss. The respondents, in proceedings in the Supreme Court of Queensland, argued that the appellant’s supply of the seed was too remote from the damage suffered by the Shrimps and so did not come within the insuring clause. Of especial importance in the insurance policy was an “Efficacy Cause”, which excluded liability from particular defined events, and this was the focus of the Court’s decision.

The Efficacy Clause operated to exclude liability when a product fails to achieve its intended purpose. The respondents contended that this clause was engaged because the appellant’s liability arose from the failure of the seed planted by the Shrimps to “fulfil its intended use or function”. The Court held that this proposition implied that a purpose of the seeds was that they would not injure.

In deciding whether the liability of the appellant for the damage caused to the Shrimps’ land arose out of the failure of the seeds to fulfil their function, and thus be excluded under the second limb of the Policy’s Efficacy Clause, the Court answered in the negative. Liability, the Court held, arose by reason of the direct effect of the seeds upon the land. That is, the liability to the Shrimps was for what the seed did; not what it failed to achieve. Therefore, the Court held that the Efficacy Clause did not apply and allowed the appeal.

Monday, October 25, 2010

October Special Leave Rundown (No 2)

Three cases were given special leave to appeal at the blue moon Special Leave applications on Friday:

Director of Public Prosecutions (WA) v Bowers [2010] WASCA 46
Director of Public Prosecutions (WA) v White [2010] WASCA 47

Leave was granted in these two appeals which have been heard together in the Court of Appeal of the Supreme Court of Western Australia. These cases concern the breadth of the Criminal Property Confiscation Act 2000 (WA). In particular, it deals with the definition of what property is considered to be 'crime-used' for the purposes of s 146 and therefore potentially subject to a confiscation order. In some respects, the case turns on the approach that should be taken to statutory interpretation in legislation which is draconian in its effect.

Lanepoint Enterprises Pty Ltd (Receivers and Managers Appointed) v Australian Securities and Investments Commission [2010] FCAFC 49

Leave was granted in an appeal from the Full Court of the Federal Court. The case concerns applications for winding up by ASIC.

By virtue of the appointment of managers and receivers to Lanepoint, there arose, by virtue of the Corporations Act 2001 (Cth), a presumption of insolvency upon which ASIC relied to bring a an application for an order winding up Lanepoint. Lanepoint however claimed that it was not insolvent by virtue of a series of transactions which lowered one of its liabilities from around $6 million down to about $2 million. ASIC claimed that these transactions were invalid or void and should not be considered in determining the solvency of Lanepoint.

The question for the High Court - which the Full Court answered in the negative - will be whether the winding up proceedings are an appropriate venue to enter an enquiry as to the effectiveness of certain complex transactions with other companies who are not party to the proceedings.

Abetz challenge withdrawn

Australia's own private birther challenge was called on in the High Court today, where the Court sat as the Court of Disputed Returns to determine whether Senator Eric Abetz is disqualified from sitting due to his German citizenship.

Perhaps uncharacteristically for a birther challenge, the challenge is not being pursued because incontrovertible evidence of Abetz’s renunciation of citizenship has come to light.

The challenge was brought by Tasmanian antiques dealer John Hawkins. Counsel for Hawkins today sought leave to withdraw the petition.

Generally, such challenges are referred to the Federal Court for hearing rather than being directly dealt with by the High Court. Last time they referred a case, as far as I know, was back in 2009 in relation to a, then, lesser known independent named Rob Oakeshott.

Wednesday, October 20, 2010

New HCA Judgments: WorkCover v Amaca, Pollock and Finch

Three new decisions handed down by the High Court today. All were unanimous, they were:

WorkCover Queensland v Amaca Pty Ltd [2010] HCA 34 

The High Court has unanimously allowed this appeal against a decision of the Court of Appeal of the Queensland Supreme Court.

WorkCover paid compensation to a worker for injury, including pain and suffering, caused by the worker contracting mesothelioma in the course of his employment. WorkCover brought proceedings under s 207B  the Workers' Compensation and Rehabilitation Act 2003 for indemnification of that payout from the employer, Amaca (nĂ© James Hardie). However, between the payout by WorkCover to the employee and the bringing of indemnity proceedings against Amaca, the employee died. Amaca argued that because s 66 of the Succession Act 1981 prevented the survival of actions for pain and suffering after death, WorkCover was thereby barred from seeking indemnity for that amount.

The Court said that s 66 of the Succession Act did not prevent WorkCover recovering the indemnity. It was said that that Act serves only to limit the damages that can be recovered on an action brought by the estate of a deceased. The wording of the Act and the mischief it seeks to avoid both suggest that it does not limit WorkCover’s action.

Pollock v The Queen [2010] HCA 35

The High Court has unanimously allowed this appeal against a decision of the Court of Appeal of the Queensland Supreme Court.

Following a drug and alcohol fuelled evening filled with arguments and accusations of abuse, Andrew Pollock struck his father with a rock and killed him. At trial the issue of provocation was put to the jury. The judge provided the jury with a list of seven propositions, the proof of which by the prosecution would displace the defence of provocation. Among these propositions was the assertion that 'the loss of self-control was not sudden'. The jury asked the judge to elaborate on the meaning of sudden, to which her Honour provided an OED account of ‘sudden’ which comprised concepts such as ‘immediacy’. Another proposition read “when Andrew Pollock killed [his father] there had been time for his loss of self-control to abate”.

The Court said that the existence of a period of time between the provocative conduct may be evidence that shows that the impugned act was not caused by provocation but it does not of itself displace such a defence. The references by the trial judge to terms such as ‘sudden’ and ‘immediate’, in the absence of elaboration, would have misled the jury into misunderstanding what was required to be proved. The Court said that this error had occasioned a miscarriage of justice and a new trial – another, this was already a retrial – was ordered.

Finch v Telstra Super Pty Ltd [2010] HCA 36

The High Court has unanimously allowed this appeal against a decision of the Court of Appeal of the Victorian Supreme Court.

The applicant, Finch, claimed to be unable to work due to gender orientation related depression. Finch made an application for a payout of Total and Permanent Invalidity benefit from his superannuation fund. The trustee rejected the claim. The deed required that the employee be absent from work for 6 months and undertake a rehabilitation course. It also required that the trustee be satisfied that the employee has ceased to be an employee and is unlikely to engage in gainful work.

The bulk of the High Court’s reasons deal with the construction of the superannuation deed. This discussion led to the rejection of a finding by the Court of Appeal that a requirement in the deed that the employee be absent from work for 6 months, related only to work at the original workplace, Telstra. The Court rejected this and moved on to the more interesting issues of control of trustee action.

The Court refused to revisit the cases which follow Karger v Paul [1984] VR 161, in order to consider the circumstances in which a ‘discretionary’ decision of a trustee will be set aside in the absence of good faith. However, their Honours did say that at least the decision in the deed in this case by the trustee that he or she is satisfied that the employee has ceased work is by no means a discretionary decision in the sense of Karger v Paul. In any event, the Court agreed with the first instance judge that the trustee had failed to ‘give the matter "genuine" consideration in that it had failed to pursue sufficient inquiries’. The Court remitted the matter to the trustee for reconsideration.

Friday, October 1, 2010

October Special Leave Rundown

Of the 6 or so cases that applied for special leave to appeal today, not a single one received a grant of leave.

The cases included an appeal against the conviction for sexual offences of William Kamm (better known to some as the Little Pebble, antipope Peter II the Roman of the Order of St Charbel).

Also denied special leave was the decision of Da Ros v Qantas Airways Limited [2010] NSWCA 89 which found that a flight attendant who was injured while riding their bicycle recreationally on a stop over between flights could claim under Workers' Compensation legislation.

The case of International Finance Trust Company Ltd v New South Wales Crime Commission (No 2) [2010] NSWCA 46 was "removed from the list". That case arises out of the same facts of its namesake High Court decision from last year ([2009] HCA 49). The High Court had dismissed proceedings on the ground that the section under which it was brought was contrary to the Constitution and invalid. The NSWCA then found that certain consent orders made in the course of those proceedings remained in farce notwithstanding the High Court's dismissal of the proceedings.

Thursday, September 30, 2010

Poniatowska: the special leave fast lane

On Monday, the High Court fast tracked a special leave application for an appeal by Malgorzata Poniatowska (transcript here). Malgorzata first made headlines when she won a record breaking sexual harassment payout from Hickinbotham's Real Estate for some seriously derogatory comments made by her employer. Unfortunately for her, the Commonwealth Government must follow Federal Court rulings because she was promptly charged with failing to report her income from her employment to Centrelink. She originally pleaded guilty to 17 charges of obtaining a financial advantage, but she then appealed to the Full Court of the South Australia Supreme Court, who - surprisingly to most - set aside the convictions: Poniatowska v DPP (Cth) [2010] SASCFC 19.

Doyle CJ and Duggan J found that liability for an omission under the Criminal Code requires a legal duty, as is the case at common law. Their Honour's said that no legal duty had been identified by the prosecution and that therefore the complaints could not be sustained.

Obviously, this decision disrupts a great deal of Centrelink prosecutions around Australia, given that "obtaining a financial advantage" is the principal weapon in the Centrelink prosecutions' arsenal. And whilst common lawyers tend to abhor codification of legal rules that departs from well established common law traditions, as Sulan J said in dissent, the intention of the Parliament was clearly directed at capturing offences of this very type. It's a difficult question and, accordingly, at the High Court hearing on Monday, Hayne J fast tracked the case to the November special leave sittings where, I suggest, it will be likely to receive leave. Watch this space.

More from Heydon J waxing lyrical

I‘ve posted before on Heydon J’s increasing predilection for sexing up his judgments. In the decision handed down yesterday of Travelex Ltd v Commissioner of Taxation [2010] HCA 33, the High Court had to decide whether foreign currency was just the paper on which it was written or whether there was something more to it.

According to Heydon J (at [47]):

The rights supplied were the rights enjoyed by the holder of the currency as created by the statute law of Fiji. The handing over of the pieces of paper constituted, evidenced, and was not capable of disaggregation from, the supply of rights. Apart from those rights, the pieces of paper had little value. They might have been used to stop an uneven table wobbling, or to jam shut a loose door, or to amuse small children, or to light a cigar. If the currency included coins, the coins might have been used to turn stiff screws or to lay on railway lines for the purpose of being flattened. But uses of that kind, which are very remote from their real purpose, would not prevent both the pieces of paper and the coins from being almost worthless. The supply of the currency was a supply in relation to the rights it gave because these rights constituted the pith and substance of the transaction.
(Emphasis added.)

Wednesday, September 29, 2010

New HCA Judgments: Miller; Kostas & Travelex

Three new decisions were handed down today.  Appeal allowed in all of them:

Miller & Associates Insurance Broking Pty Ltd v BMW Australia Finance Limited [2010] HCA 31

The High Court has allowed this appeal from the Victorian Court of Appeal.

The appellant, Miller, is an insurance broker which organised an insurance policy for a company called Consolidated Timber. The broker organised for Consolidated Timber to loan the premiums through a premium funding loan with the respondent, BMW.  Under premium funding loans, it is common for the insurance policy to be cancellable, thereby giving some protection and security to the lender in the case of default. The policy in this case was not cancellable. The borrower, Consolidated Timber, defaulted on the loan. BMW brought an action against Miller claiming that it had engaged in misleading and deceptive conduct by providing documentation that suggested that the insurance policy was cancellable or by not disclosing the fact that the insurance policy was not cancellable.

The Court (Heydon, Crennan and Bell JJ (French CJ and Kiefel J agreeing) found that the certificate of insurance that was inspected by BMW did not represent that the policy was cancellable simply because it appeared to relate to property insurance (a type of insurance that is often cancellable) (at [87]). The Court also found that notwithstanding some ambiguity in the documentation provided by Miller to BMW as to the precise nature of the policy, the failure by Miller to advise that the policy was not cancellable was not misleading. In so finding the Court had regard to the commercial knowledge and experience of the parties as well as the extent of investigations by BMW.

The Majority decision concerns itself primarily with the legal consequences of the facts, but there is some more general discussion of the law of ‘misleading silence’ in the joint reasons of French CJ and Kiefel J.

Kostas v HIA Insurance Services Pty Ltd [2010] HCA 32

The High Court has allowed this appeal from the Court of Appeal of the Supreme Court of New South Wales.

The appellants, Mr and Mrs Kostas, hired a building company to build on a property. A dispute arose and litigation ensued between the Kostas and the builder’s insurers, HIA. The claim was brought to the Consumer, Trader and Tenancy Tribunal. The Tribunal made a finding, before the hearing of the full claim, that the contract had been repudiated by the Kostas.  A necessary step in reaching this conclusion was to find that the builder had properly served on the Kostas an application for extension of time to build the property in accordance with the contract. HIA appealed on the ground that the there was no evidentiary basis before the Tribunal to find that such service occured. The relevant Act provided for statutory appeal from the Tribunal in relation to “a question with respect to a matter of law". The issue for the High Court was therefore, whether the sufficiency of evidence to make a finding is a question with respect to a matter of law for the purposes of the Act.

The Court (Hayne, Heydon, Crennan and Kiefel JJ (French CJ reaching the same conclusion) found that a finding by the Tribunal that there was material properly before it which supported the conclusion that service had occurred was “a question with respect to a matter of law" and was therefore capable of being the subject of appeal. The Court found that there was no such evidence before the Tribunal and said that (at [91]) “[w]hat amounts to material that could support a factual finding is ultimately a question for judicial decision. It is a question of law.” French CJ said that the wording of the statutory appeal would allow appeal from questions of mixed law and fact (at [25]).

Travelex Ltd v Commissioner of Taxation [2010] HCA 33

The High Court has allowed this appeal from the Full Court of the Federal Court.

Travelex sold foreign currency at a store on the departures side of the international customs gate at Sydney airport. It sought to claim input tax credits for GST purposes for sales at that store, which could only occur if the supply was “GST Free” as defined in the Act. The question for the Court was therefore whether the sale of foreign currency is a taxable supply in relation to which GST attaches. Relevantly to the proceedings, a supply is “GST free” if (a) it is not a supply of goods or real property; (b) it is a supply made "in relation to rights"; and (c) "the rights are for use outside Australia". The parties agreed that this was a ‘supply’ and also that (a) and (c) were satisfied. The argument therefore centred on whether this was a supply made "in relation to rights".

The lead judgment was written by French CJ and Hayne J (Heydon J reaching the same conclusion) (Crennan and Bell JJ dissenting). It was said that the foreign exchange cannot be described merely as the sale of a “token” of foreign currency.  Rather, that token represents rights, including the right to present it as legal tender in the country on its face, without which the token would be worthless. Because the foreign currency attaches such rights, there was the necessary supply "in relation to rights". Accordingly, the supply was “GST free”.

Thursday, September 23, 2010

More Commentary on Dickson

I posted yesterday on the High Court decision in Dickson v The Queen [2010] HCA 30. In addition I would recommend taking a look at the interesting discussion at Quis Custodiet Ipsos Custodes and Don Mathias’s Blog, as well as an interesting comment to my post from Jeremy Gans.

New HCA Judgment: Dickson v The Queen

This decision was handed down today:

Dickson v The Queen [2010] HCA 30 

The High Court has unanimously allowed this appeal against a decision of the Victorian Court of Appeal. The case concerns s 109 of the Constitution which invalidates State legislation if it is inconsistent with Commonwealth legislation. The appellant was a former Federal Police officer who was convicted of conspiracy to commit theft of a large quantity of cigarettes from a Commonwealth Customs’ storage facility. The property which housed the facility was owned by a company called Dominion and because the owner of the property where the theft occurred was not a Commonwealth agency, the appellant was charged under state legislation. That legislation adopted the common law requirements of conspiracy. However, the Customs Department was leasing the property for storage. Accordingly, the cigarettes were also in the “possession” of Customs (being a Commonwealth agency) and so the appellant could have been charged under the Commonwealth Criminal Code. This was important because the Commonwealth Criminal Code provided for a far more limited test for the requirements of conspiracy. The High Court said that the State Act was inconsistent in so far as it purported to provide for an offence in such a case. It was said that the Commonwealth Act provided for a charge prohibiting a conspiracy to steal Commonwealth property, which charge specifically limited the requirements of conspiracy. Accordingly, any State Act that purported to provide for a charge in the same circumstances, but with fewer requirements would impose greater obligations on the accused and therefore “alter, impair or detract” from the operation of the Federal Act. Accordingly the state law was directly inconsistent with the Federal law and therefore invalid under s 109.

It is interesting to note that the Court relied on direct inconsistency rather than the “covering the field” test. Obviously it would seem easier to simply say that the Federal Act evinces an intention to be exhaustive on the subject of conspiracy to steal Commonwealth property. Instead the Court said that, by restricting the requirements of the charge, a state law which was wider than those restrictions was invalid. This case therefore has potentially wide implications to other offences of concurrent state and federal jurisdiction. This is particularly so given that the Court considered it relevant to the requirements of the offence that s 80 of the Constitution would require the jury verdict under Commonwealth law to be unanimous whereas state law would allow a majority verdict. As this is the case with most offences these days, an argument could be run that the Commonwealth Act need always be used if there may be concurrent jurisdiction. I don’t think the Court’s language was so wide as to suggest that the requirement of a unanimous verdict would be sufficient in itself to show that a state law “alters, impairs or detracts” from the operation of a Federal Act, but I’m sure there will be argument in Courts around the Country that it is. In any event, the moral of the story is that if a client of yours has been charged with a state offence, it is worth finding out whether the client has also committed a Commonwealth offence in so doing (eg it was done over the internet). You might be able to attract a charge which requires a unanimous verdict.

Monday, September 6, 2010

September Special Leave Rundown

Plenty of special leave grants on Friday, they were:

Byrnes v Kendle [2009] SASC 385 (and subsequent decision at (No 2) [2010] SASC 64)

Leave was granted in an appeal from the Full Court of the South Australian Supreme Court. The case concerned a written “acknowledgement of trust” by Kendle in favour of Byrnes over half of a residential property which was then leased to Kendle’s son. The Court found that there was a declaration of trust but that Kendle’s failure to collect rent from the son did not amount to a breach of duty by Kendle as trustee and, in the alternative, Byrnes had acquiesced in the breach. The key issue raised in this decision is the determination of the scope of a trustee’s duties by reference to the nature of the trust.

In a subsequent hearing of the appeal, the appellant tried to argue that the Full Court should reopen the case because it proceeded on an incorrect assumption of fact. This raises what is sometimes a delicate distinction between matters that are sufficient to reopen a case, and matters that ought to be the subject of an appeal.

Jemena Asset Management Pty Ltd v Coinvest Limited [2009] FCAFC 176

Leave was granted on limited grounds in an appeal from the Full Court of the Federal Court dismissing an application to declare provisions of the Construction Industry Long Service Leave Act 1997 (Vic) invalid. The appellants argued that certain provisions in that Act, which require employers to make contributions towards long service leave benefits for their employees, and the Federal Employment Awards to which the employers are subject, are inconsistent within the meaning of s 109 of the Constitution. The appellants said that the Federal Employment scheme intends to “cover the field” relating to long service leave and so the State law is invalid under s 109. The Court said that the “field” which the Federal scheme covers does not extend to that with which the State legislation deals, and so the State law is not invalid.

Haxton v Equuscorp Pty Ltd [2010] VSCA 1

Leave was granted in an appeal from the Full Court of the Victorian Supreme Court. The case concerns the right in restitution, on the ground of “total failure of consideration”, to recover moneys provided under loan agreements which have been found to be illegal and unenforceable. The case also concerns the topic of whether such a claim in restitution is capable of assignment or whether it is, in the words of the authorities, “a bare cause of action” (a topic that is very close to this author’s heart).

R v Momcilovic [2010] VSCA 50

Leave was granted in an appeal from the Full Court of the Victorian Supreme Court. The case involved a defendant who was charged with possession of drugs for sale. The evidence was that the drugs were found in the applicant’s apartment. Under s 5 of the Drugs, Poisons and Controlled Substances Act 1981 (Vic), the defendant was deemed to be in possession of the drugs unless she ‘satisfie[d] the court to the contrary’. The Full Court found that this provision could not be interpreted in a manner that was consistent with the presumption of innocence as provided for by the Charter of Human Rights (Vic). Accordingly the Full Court made a declaration of incompatibility under s 36 of the Charter.

Commissioner of Taxation v BHP Billiton Finance Limited [2010] FCAFC 25

Leave was granted in an appeal from the Full Court of the Federal Court. The Full Court upheld the decision of the trial judge who had found that BHP Billiton’s finance company had carried on the “business of lending money” for the purposes of the Income Tax Assessment Act 1997 (Cth) and was therefore able to write off around $2.2 billion of bad debts as tax deductions.

Gordian Runoff Limited v Westport Insurance Corporation [2010] NSWCA 57

Leave was granted (on limited grounds and referred to an enlarged Court on other grounds) in an appeal from the Full Court of the Supreme Court of New South Wales. The case concerns the nature of an appeal from an award of an arbitrator following an arbitration conducted under the Commercial Arbitration Act 1984 (NSW). The decision chiefly deals with the similarities between such an appeal and an application for judicial review. It also deals with the degree of detail necessary in an arbitrator’s reasons.

Firedam Civil Engineering Pty Ltd v Shoalhaven City Council [2010] NSWCA 59

Leave was granted in an appeal from the Full Court of the Supreme Court of New South Wales. The case concerns a building contract which stated that certain disputes are to be referred to for “expert determination” which will be binding on the parties. The Full Court found that the expert report was not binding on the parties because the expert had displayed inconsistencies in his reasons for determination. The important issue in this case is the degree to which an expert must err before a court will declare the expert’s determination to be not binding on the parties.

Notable cases for which leave was refused:

The High Court refused special leave for Qantas to appeal from the Full Court of the Federal Court’s decision in Leonie's Travel Pty Ltd v Qantas Airways Limited [2010] FCAFC 37. In that case the Full Court found that Qantas was not entitled to make unilateral determinations under agency contracts to the effect that certain commissions were not payable to travel agencies. The full quantum of the amount due by Qantas to the travel agents is not yet calculated (at [105]) but it is reported to be in excess of $26 million.

Friday, September 3, 2010

New HCA Judgment: Public Trustee v Fortress Credit Corp

This decision was handed down on Wednesday:

Public Trustee of Queensland v Fortress Credit Corporation (Aus) 11 Pty Ltd [2010] HCA 29

The High Court has dismissed this appeal against a decision of the Full Court of the Queensland Supreme Court. The case concerns what constitutes “a variation in the terms of a registrable charge” for the purpose of the registration requirements in the Corporations Act 2001 (Cth).

A variation in the terms of a charge must be registered under the Act or else it is void. In this case, a "Charge Document" secured any amount payable under what it called “Transaction Documents”. “Transaction Documents” were defined in another document, called the “Facility Agreement”, to include anything that the parties agree in writing to be a Transaction Document.

Subsequent to the registration of that charge the parties entered into a deed which deemed a particular guarantee to be a “Transaction Document” for the purposes of the "FAcility Agreement" and therefore the charge. This therefore resulted in an increased amount of money secured by the charge. The Court found that the phrase “terms of the charge” referred to the terms of the written instrument representing the charge and not necessarily to the scope of the charge or to the amount charged. Accordingly, this transaction did not constitute “a variation in the terms of a registrable charge” or a “creation of a charge” and so there was no requirement to register.
In case it is not abundantly clear from the context, none of what is written here should be considered legal advice or anything close to it.
The views expressed in each post are the views of the contributor who has authored that post only and should not be attributed to anyone else.
Feel free to quote or reproduce our posts for non-commercial purposes wherever you like but you need to attribute authorship. Click the CC logo to see our Creative Commons licence:

Creative Commons License