Attorney-General for NSW v State Authorities Superannuation Board & Anor P43/1994 [1995] HCATrans 136 (5 May 1995)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Perth Nos P42 and P43 of 1994

B e t w e e n -

THE ATTORNEY-GENERAL FOR NEW SOUTH WALES

Applicant

and

STATE AUTHORITIES SUPERANNUATION BOARD

First Respondent

and

COMMISSIONER OF STATE

TAXATION FOR THE STATE OF WESTERN AUSTRALIA

Second Respondent

Applications for removal of cause pursuant to section 41 of the Judiciary Act 1987

BRENNAN CJ

TOOHEY J

GUMMOW J

TRANSCRIPT OF PROCEEDINGS

FROM PERTH BY VIDEO LINK TO CANBERRA

ON FRIDAY, 5 MAY 1995, AT 12.10 PM

Copyright in the High Court of Australia

MR L.S. KATZ: If Your Honours please, in this matter I appear for the Attorney-General for New South Wales. (instructed by the Crown Solicitor for New South Wales)

MR R.E. COCK: May it please the Court, I appear for the Commissioner for State Taxation of Western Australia. (instructed by the Crown Solicitor for Western Australia).

BRENNAN CJ: Yes, Mr Katz.

MR KATZ: Your Honours, before I deal with the substance of my submissions on the removal application, there is one preliminary matter which I wish to raise. As of Wednesday evening last, the Attorney had given no notice under section 78B of the Judiciary Act to any other Attorney in respect of the removal application. That was done because a view was taken, and is maintained, that there was no necessity in the circumstances to give such notice. But on Wednesday evening my instructing solicitor was contacted by the Registry and a view was expressed to him that it was requisite that notice be given under section 78B.

Discretion being the better part of valour, we have attempted to give such notice. Indeed, we have given such notice and I am in a position to prove the giving of such notice early yesterday morning to all of the other Attorneys as to the question which arises under section 78B of the passage of a sufficient period of time for those Attorneys to decide whether or not to seek to intervene in the matter. In my submission, your Honours would be satisfied as a result of some factual material which I seek to place before you from the Bar table. At present the position is t

his, that we have had responses from seven of the eight other Attorneys involved. The only Attorney from which we have not had a response is the Attorney-General for the Australian Capital Territory.

As to the other seven Attorneys, we have received written responses from the Commonwealth and the Northern Territory and oral responses from Tasmania, Queensland, Victoria, South Australia and Western Australia. As would have been predicted, all of the responses were that there is no desire to intervene in the matter. As to the remaining Attorney, the Attorney for the Australian Capital Territory, we sought to make contact this morning with the appropriate officer in the Attorney's department and were told that he was to be present in Court today for the purpose of responding to the notice which had been given yesterday. I am not able to assist any further on the question of whether or not - - -

BRENNAN CJ: Perhaps I should inquire, is there any appearance on behalf of the Attorney-General for the Australian Capital Territory? It seems that the answer is in the negative.

MR KATZ: I am in a position to hand up an affidavit of service with respect to the giving of notice under section 78B. I am in a position to tender the written responses which have been received from the Attorneys-General for the Commonwealth and the Northern Territory. As I say, I have instructions that oral replies were received from all of the other Attorneys bar the Australian Capital Territory Attorney. Your Honours will be aware that section 78B(1) requires the Court not to proceed unless satisfied that a reasonable time has elapsed since the giving of the notice. In my submission, your Honours would be satisfied that a reasonable time has elapsed, given that seven of the eight Attorneys found themselves able to make a positive response to the giving of the notice within the time.

BRENNAN CJ: As a matter, perhaps, of more than curiousity, what was the issue that was specified in the 78B notice?

MR KATZ: The issues which were specified were those issues which, in the Attorney's submission, justified the removal of these two appeals in the Full Court of the Supreme Court of Western Australia into this Court.

BRENNAN CJ: I see. And was couched in those terms?

MR KATZ: Yes, your Honour. Reference was made to the issues as raised on behalf of the State Superannuation Board. I believe that a copy of the notice was filed in the Registry.

BRENNAN CJ: Yes. I am sorry, I had not read the notice.

MR KATZ: If your Honours see paragraph 2 of the notice which was given states those matters. If your Honours were satisfied that whether or not section 78B needed to be complied with, it had been complied with, then I would move to my substantive submissions.

BRENNAN CJ: On the assurances from the Bar table the Court is so satisfied, Mr Katz.

MR KATZ: If your Honours please, that will save the necessity to justify the position which was taken at the outset. May I then move to the matters of substance.

GUMMOW J: How do you say section 64 was engaged in this case, because the action in the West Australian Supreme Court was an action between States? What made it a federal jurisdiction case to engage the Judiciary Act?

MR KATZ: Your Honour, the dispute as it had its genesis was one as to the direct applicability to the New South Wales State Authority Superannuation Board of the Western Australian Stamp Act. The Western Australian authorities, as a fall-back position, assert that if the Stamp Act is not applicable to the Super Board of its own force then section 64 of the Judiciary Act makes the Stamp Act applicable to the Board as a matter of surrogate federal law. When confronted with that fall-back position, the Attorney takes the position in response that if section 64 were to have that effect it would be to that extent unconstitutional. It would not be justified, for instance, by the terms of section 78 of the Constitution and in the particular circumstances of this case the application of the Western Australian law to the Board through the indirect medium of section 64 would breach section 114 of the Constitution which prohibits the imposition of a tax on a State by the Commonwealth.

GUMMOW J: But is there not a threshold question as to whether the Board is the New South Wales State?

MR KATZ: Certainly, your Honour, and may I inquire whether your Honour has the - - -

GUMMOW J: But is that question one that is caught up under the 78B notice, that threshold question?

MR KATZ: No, your Honour. There are, in my submission, four questions which require to be resolved for the resolution of the two appeals. May I ask whether your Honour has the two written documents filed on behalf of the Attorney?

GUMMOW J: We have been favoured with a number I think, Mr Katz.

MR KATZ: Yes. The first one was one of the 24th of 1995, outline of submissions for Attorney-General for New South Wales. In that document in paragraph 4 we have endeavoured to set out the questions which would arise for argument, if not for determination, in the hearing of the relevant appeals. The first of the four questions is a question simply of construction of the Western Australian statute. The second of the questions is a question effectively simply of construction of the relevant New South Wales statute, namely, the Superannuation Administration Act. If those questions are answered in a fashion adverse to the interests of the Western Australian authorities then, as I say, the Western Australian authorities seek to rely on section 64 of the Judiciary Act 1901 and then the third and fourth question become necessary for decision.

Section 40(1) provides for removal as of course on the application of an Attorney in cases where a cause involves the interpretation of the Constitution and the point at issue between the Attorney on the one hand and the Commissioner of State Taxation on the other is whether or not these appeals involving the decision in the four questions which I have mentioned are causes involving the interpretation of the Constitution.

BRENNAN CJ: But they do not, do they? I mean the threshold question has been resolved against you and the threshold question places you in a position of an ordinary litigant not protected by any Crown immunity.

MR KATZ: Yes, your Honour.

BRENNAN CJ: As at present there has been a judicial decision that you are not the Crown.

MR KATZ: Yes. We have appealed against that and in response to our appeal, the Commissioner of State Taxation has put on notices of contention in each of the appeals. They appear at pages 29 and 31 in the application book, in which it is said relevantly at page 29, for instance, to take an example, that the Commissioner:

will contend that the decision of the Court below should be affirmed on grounds in addition to those relied upon by the Court below.

2. -

the additional ground is that -

Section 64 of the Judiciary Act 1903 (Cth) requires that the liability of the Appellant to pay stamp duty on the Sale Agreement dated 9 December 1991 be determined by the Court as though the Appellant were a subject.

So that the Commissioner of State Taxation has presented for determination, by the court determining the appeals, a question of the applicability of section 64.

BRENNAN CJ: Contingently on failing on the main issue.

MR KATZ: Certainly. Your Honour did ask me a question and perhaps I should just answer directly. Such authority as there is in this Court is uniformly in favour of a conclusion that these causes involve the interpretation of the Constitution. Nonetheless though, it is not inevitable that questions 3 and 4 will be required to be answered because of possible answers to questions 1 and/or 2, and in the second of the written documents, which I hope your Honours have - this was a document of 1 May, Outline of Submissions in reply - I have referred to, so far as my researches have been able to carry me, the only three decisions of this Court ever, which have dealt with the presently relevantly question. If it would be convenient, I would take your Honour immediately to the relevant authorities: the first of them, which I refer to in paragraph 2, is Ex parte Walsh & Johnson [1925] HCA 53; (1925) 37 CLR 36.

Your Honours will recall Walsh and Johnson were two men in the custody of Yates pending their deportation from Australia pursuant to a deportation order made by a minister under the Immigration Act, and they applied for habeas corpus from the Supreme Court of New South Wales. They obtained rules nisi and before the rules nisi could be returned, the Commonwealth Attorney-General removed the applications for habeas corpus into the High Court. Perhaps it would be convenient if your Honours were to go immediately to page 57 in the reasons for judgment of Chief Justice Knox. His Honour says in the second paragraph:

Each applicant having obtained in the Supreme Court of New South Wales a rule nisi calling on the respondent Robert Walter Yates, the person in whose custody he was detailed, to show cause why a writ of habeas corpus should not issue, an order was made in each case by this Court, on the application of the Attorney-General of the Commonwealth, removing the cause into this Court in pursuance of sec 40 of the Judiciary Act. On the motions to make absolute the rules nisi coming on in this Court, counsel for the applicants submitted that this Court had no jurisdiction to entertain the matter and, in the alternative, that the order for removal ought to be rescinded. I have had the advantage of considering the opinion about to be expressed by my brother Starke on the questions so raised, and agree with him both in his conclusions and in the reasons -

If your Honours then go to page 130, your Honours will find the relevant reasoning of his Honour Justice Starke and if I may, I begin in the first complete sentence on that page:

The applicants were detained under an order for deportation issued pursuant to the provisions of the Immigration Act-1925, sec 8AA. That order was attacked on many grounds, but the constitutional validity of the section under which it was made was directly challenged, and was indeed, as the argument in this Court demonstrated, a vital question in the case.

And then follows the passage on which I particularly rely:

It is not necessary, when removal of a cause, &c, is sought, to establish that the interpretation of the Constitution will necessarily call for decision, but only that that subject is involved or entangled in the controversy. If it is, the Attorney-General of the Commonwealth or the Attorney-General of a State, can remove the cause, as of course, whether he is a party to it or not, subject always to the powers conferred upon the Court by sec 42. A party cannot remove the cause as of course, but only for sufficient cause shown to the Court. Once the cause is removed, the High Court is clothed with full authority essential for its complete adjudication: it is the cause which is removed, and not merely the question involving the interpretation of the Constitution; though it is that question, as already indicated, which attracts the cause to the jurisdiction of the High Court -

May I pause, before moving on, to say that section 42 to which his Honour there referred was in a different form at the time of the decision in Walsh & Johnson than it is presently, although section 40(1) was in a materially identical form. Section 42 then said if, in any cause removed into the High Court, it appears that the cause does not really and substantially arise under the Constitution or involve its interpretation, the court shall proceed no further, but shall remit the cause to the court from which it was removed.

TOOHEY J: Mr Katz, you are wearing two hats, are you, in this matter? You are appearing for the Attorney and in wearing that hat, you ask - or you do not ask, I suppose - you require that the matter - - -

MR KATZ: I demand, it, your Honour.

TOOHEY J: That is right, but I was going to stop short of saying "demand". It shows that the more mild term require that the Court take this matter on board. We have no submission from the first respondent, so I take it the first respondent is saying what?

MR KATZ: This is a matter of great embarrassment to me. I knew I would not be able to escape these proceedings without somehow `fessing up over this. The court list shows that I appear for parties on both sides of the record. Of course that cannot be and I think that to some extent my embarrassment is caused by my own lack of vigilance in the matter. The position is, if your Honours will permit me to regularise it, that of course, the Superannuation Board supports the application which is made on behalf of the Attorney, although the Board - - -

TOOHEY J: Do you mean supports it in so far as the Attorney relies upon the words "as of course", or does the Board have an independent submission that we should remove it for sufficient cause?

MR KATZ: The position is identical to the position which obtained in the case of the Attorney-General(NSW) v Commonwealth Savings Bank. In that case there were applications for removal, both by the Attorney-General for New South Wales and by the State Bank of New South Wales; but given that the Attorneys had an entitlement as of course, whereas removal at the instance of the State Bank of New South Wales was discretionary only, the Court said it was unnecessary to give any consideration to the application made to the discretionary power of the Court.

TOOHEY J: Unless the Court is not satisfied that there is, in fact, a matter arising under the Constitution or involving its interpretation. I would rather have expected to have found the Board as an applicant in its own right, relying upon the discretion of the Court.

MR KATZ: Your Honour, if there is no matter here involving the interpretation of the Constitution, the position of the Board is no better than that of the Attorney and, in truth, if your Honours will permit me to regularise the position, could I apply orally to have the Board removed as a party respondent to the application and joined as a party applicant with the express statement that, of course, the Board's position can be no better than that of the Attorney, and for that reason, only the Attorney's application need be considered. It would, at least, allow me to escape from the embarrassment of wearing, as your Honour said, two hats or two wigs, or whatever. Certainly, nothing turns on this peculiarity and in truth the application is supported by the Superannuation Board.

Your Honours, I had mentioned to you the approach taken by Justices Starke and Knox in Walsh's Case. I have, in the written submissions, referred to the identical approach taken by Justices Rich and Dixon in a later section 40(1) removal case - Duncan v Vizzard. May I take your Honours then to Duncan v Vizzard? Perhaps before I do that, may I just make one concluding remark about Ex parte Walsh & Johnson. None of the other three Justices who participated in the case expressed a view one way or the other about the matter which I have relied on at page 130 but, in my submission, it is only consistent with acceptance of the view taken by Justice Starke that the other three of their Honours dealt with the matter in the way in which they did.

Significantly, Justices Isaacs and Rich, in Ex parte Walsh & Johnson, found on non-constitutional grounds that the deportation orders were invalid - that is to say, non-constitutional grounds in addition to constitutional grounds. Their Honours took the view, if I can just describe it in this shorthand way, that there had been a denial of natural justice on the part of the Minister. So that the orders were defective on that basis. So that, certainly, that approach to the matter is consistent with a view that a matter can legitimately be removed into this Court, nonetheless though there is no inevitability about the determination of the questions of constitutional law which justify the removal.

Now, if I may, Duncan and Green Star Trading Co. Pty. Ltd. v Vizzard [1935] HCA 43; 53 CLR 493. Green Star Trading was a road transport company, Duncan was its employed driver. Both the employer and the employee were charged with and convicted of a series of offences under the New South Wales State Transport (Co-ordination) Act 1931 . They both appealed to Quarter Sessions and the chairman of Quarter Sessions stated a case for the Court of Criminal Appeal. In fact, the questions in the case are set out from the bottom of page 497 to the top of page 499. There were 11 questions, two of which only implicated the Constitution. Those were questions 6 and 7 on page 498 which raise sections 90 and 92 of the Constitution.

Mr Vizzard, who was the informant in all of the prosecutions, obtained an order for removal of the case stated into the High Court under section 40(1) and - - -

BRENNAN CJ: I do not think we need trouble you any further, Mr Katz. We will hear what Mr Cock has to say.

MR KATZ: If your Honours please.

BRENNAN CJ: Mr Cock.

MR COCK: Yes, thank you, your Honours. It is our submission that the resolution of the questions before the Full Court do not require consideration of the constitutional question. My friend concedes that. That does not, in our submission, finalise the question before your Honours. The question for your Honours seems to us to be whether the constitutional question, if determined, can resolve the controversy between the parties.

In our submission, it cannot. That is because only a resolution against the first respondent would resolve the controversy and, indeed, it seems to us that there is no guarantee that the Court will even get to that position. Therefore, the effect of removal seems to us to be that a constitutional question may be determined which does not resolve the controversy which requires the Court to then consider the points outstanding before the Full Court in Western Australia. It seems to us that my friend is putting too wide a proposition as to the proper meaning of section 40(1) and in the circumstances the condition precedent for removal is not sustained.

We should say, though, that we do not agree with my friend about his application on behalf of the first respondent. It seems to us if the application is under subsection (2), the conditions precedent are different, they are made out, and your Honours have a discretion there. But that was not the case we came here to argue. My friend seems to have conceded he is not putting that as the ground of that application.

BRENNAN CJ: But it is right to say, is it not, that if the status of the Board is resolved otherwise than has been resolved by the judge at first instance, the question of the immunity of the Crown of New South Wales from the stamp legislation of Western Australia is a question that arises under the Constitution or involves its interpretation?

MR COCK: In our submission, that question is not, because it requires the interpretation of the Stamp Act 1921 in Western Australia, firstly, and only if, on the proper interpretation of that Act, it is found that that Act does not apply to require that the State Authorities Superannuation Board is liable to pay duty does one get to section 64 of the Judiciary Act 1903 .

BRENNAN CJ: But your contention is that it does apply to the Crown in right of New South Wales?

MR COCK: Our contention is that the State legislation does.

BRENNAN CJ: Yes. In interpreting that State legislation, I take it that the extent of State power would be relevant because of the reading-down provision, I imagine, in your Acts Interpretation Act.

MR COCK: It has not been put against us at any stage in these proceedings - nor, as I understand, is it intended to be put against us in the State proceedings - that our State law cannot have that impact, because it refers to an instrument in the State of Western Australia and there is sufficient nexus. It is not, as I understand it, put that that is a ground upon which the Constitution will arise.

BRENNAN CJ: I must say that I understood it otherwise. Perhaps we could ask Mr Katz what his view is on that.

MR KATZ: Our submission is that the Western Australian Act does not apply as a matter of construction only to the New South Wales Crown, and further that the State Authorities Superannuation Board of New South Wales is the New South Wales Crown for the relevant purpose. We do not deny the authority, the power of the Western Australian Parliament, by appropriately drawn legislation to impose liability upon the New South Wales Crown.

BRENNAN CJ: I see.

MR COCK: Yes, your Honours. That does confirm my understanding of the position. So it is really not only if the appeal is upheld, but also that if the first contention of the Commissioner of Taxation is held against him, that one then goes to the effect of section 64 as effectively the third fall back and only then if it is on its proper interpretation it could be said to have the effect for which we contend, then does a constitutional question arise. Putting it another way, if the question was determined first, it would not resolve the issues between the parties.

BRENNAN CJ: Yes. Thank you, Mr Cock. Mr Katz, I would like to ask you one further question: what precisely is the issue that you say arises under the Constitution or involves its interpretation?

MR KATZ: There are two, your Honour. If section 64 were construed so as to make applicable to the New South Wales State Authorities Superannuation Board as a piece of surrogate federal law the Western Australian Stamp Act, we say that section 64 would be to that extent unconstitutional. It has been accepted in earlier authorities of this Court that in so far as section 64 deals with the State as a party defendant in litigation, the constitutional justification for its enactment is section 78 of the Constitution, which - - -

BRENNAN CJ: That is enough to answer the questions.

MR KATZ: That is certainly the first matter which arises and, the second, if I may remind your Honour, is the prohibition in section 114 against the Commonwealth taxing the property of the States.

BRENNAN CJ: This Court, constituted by only three Justices, ought to follow the earlier decisions of this Court that have considered the meaning of the phrase "arising under the Constitution or involving its interpretation" in section 40(1) of the Judiciary Act (Cth). As we understand the weight of authority, Mr Katz is entitled as of right to an order for removal. Accordingly, there will be an order for removal of the matter under section 40.

AT 12.45 PM THE MATTER WAS CONCLUDED