State of Victoria v Commonwealth of Australia M46/1994 [1995] HCATrans 302 (7 September 1995)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Melbourne No M46 of 1994

B e t w e e n -

THE STATE OF VICTORIA

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

Defendant

Office of the Registry

Adelaide No A18 of 1994

B e t w e e n -

THE STATE OF SOUTH AUSTRALIA

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

Defendant

Office of the Registry

Perth No P16 of 1994

B e t w e e n -

THE STATE OF WESTERN AUSTRALIA

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

Defendant

BRENNAN CJ

DAWSON J

TOOHEY J

GAUDRON J

McHUGH J

GUMMOW J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON THURSDAY, 7 SEPTEMBER 1995, AT 10.06 AM

(Continued from 6/9/95)

Copyright in the High Court of Australia

____________________

BRENNAN CJ: Yes, Mr Solicitor.

MR MASON: If your Honours please. I wish to turn now to the challenge we make to the validity of section 7A of the Industrial Relations Act 1991 . The essential submission is that the provision is invalid in that it purports to confer upon the federal judiciary a non-judicial function. The basal principle, the basic premise, in the submission is that federal judicial power may not be exercised in a manner which is inconsistent with the essential character of a court or with the nature of judicial power. Those words are taken from the joint judgment of Justices Brennan, Deane and Dawson in Lim v Minister for Immigration (1992) 176 CLR 1, at 27.

Other formulations of the similar principle by your Honour Justice Gaudron speaking of federal judicial power must be exercised in accordance with the judicial process. That is in Leeth's Case at 502 and Re Nolan [1991] HCA 29; (1991) 172 CLR 460, at 496 and Justices Deane and Toohey expressed the similar principle as a prohibition on the exercise of federal judicial power in a manner which is inconsistent with the traditional judicial process, Nationwide News v Wills [1992] HCA 46; 177 CLR 1, at 70.

In our submission that is the basal premise which has led to a more specific principle formulated in Pidoto's Case, in particular, with reference to the limits, the capacity or power of the Court to be required to rescue invalid legislation through a directive such as section 15A of the Acts Interpretation Act. Your Honours, in paragraph 3.8 of our outline of submission reference to made to Pidoto's case [1943] HCA 37; 68 CLR 87, the particular passages are at 107 to 111 in the judgment of Chief Justice Latham with whom Justice Rich concurred at 115 and Justice Williams agreed, in effect, at 132, and in the judgment of Justice Starke at 118 and 119.

It is a principle to which the Court has referred on a number of occasions and various authorities are cited in paragraph 3.9 of our outline of submissions. May I just add one to those that are there referred to, Nationwide News v Wills [1992] HCA 46; (1992) 177 CLR 1, at 61, Justice Brennan; 80, Justices Deane and Toohey, and 105 Justice McHugh. The principle, as we would submit, that has emerged from those cases is that there must be some indication by Parliament of a criterion by reference to which an invalid law may, as it were, be rescued through the application of a provision such as section 15A, and that that criterion must be evinced by Parliament in the legislation.

Now, it may ultimately be a matter of degree because one can posit a general law which is generally valid but invalid as to part because of the application of the Melbourne Corporation principle and nobody would contend that the law would necessarily be wholly invalid, but the vice of section 7A, in our submission, is that with presently irrelevant exceptions in 7A(2) the Court is given the function of determining whether there is any valid application. In other words, the facts are found and then the Court asks, "Well, those being the facts in the present case, do they fall within a valid application of the law?"

McHUGH J: I am not sure that the example of the State Banking Case is a good example. It is rather like section 117 of the Constitution. In other words, the Commonwealth law is related to a head of power, so it is a valid law in terms of a head of power. It just cannot apply to particular people.

MR MASON: Yes. So it is an individual passport, as it were, through the law. Yes, I would, with respect, agree with that. The task that section 7A purports to confer or impose upon the federal judiciary is one, in effect, to search around for a valid constitutional application for a law which is, ex hypothesi, found to be invalid, where there is no indication of that valid application on the face of the law or express reference to an appropriate criterion upon which it may validly be determined.

The most recent application of that principle was, in our submission, this Court's decision in the Native Title Case, West Australia v The Commonwealth [1995] HCA 47; (1995) 128 ALR 1, in the joint judgment of six of the Justices at pages 62 to 65, and it would appear that your Honour Justice Dawson agreed with that portion of the judgment at page 71 of the report, and the Court there found that section 12 of the Native Title Act which provided that:

Subject to this Act, the common law of Australia in respect of native title has, after 30 June 1993, the force of a law of the Commonwealth -

was invalid because, amongst other things, it was an attempt by Parliament to confer legislative power upon the judicial branch of government. In our submission, section 7A has that vice.

Your Honours, there is a discussion that may be of interest to the Court as to the American principles relating to severability in Alaska Airlines Incorporated v Brock [1987] USSC 42; 480 US 678. The American law appears as to severability to be similar to the Australian law but in the present context there is the limit similar to that which I am seeking to advance, namely, that "it is not part of the judicial duty to make a new law", and those words are taken from a judgment in a case called Hill v Wallace [1922] USSC 102; 259 US 44, at 70 and 71, and that case is cited with approval in Alaska Airlines at page 684. So the notion that it is foreign to judicial power to rescue a failed law by creating a new one is common to the two constitutional systems. If the Court pleases, those are our submissions.

BRENNAN CJ: Thank you, Mr Solicitor. Mr Solicitor for the Commonwealth.

MR GRIFFITH: The Commonwealth has filed extensive written submissions which my learned friend, Mr Graham, said he intended to address, as he did in his submissions, by way of reply. It is the Commonwealth's position that this case has shown very usefully the use of written submissions in constitutional cases. Perhaps we could adopt a practice that each of the parties should have a reply and that should be it on the oral proceedings. My learned friend, in his reply to our written submission identified certain matters of concern and we do not intend to take the Court in detail through our own written submissions which are there, and if I may say so, your Honour, have our best points - it does not mean that I will not concentrate on our not so good points because they are all rather good. If I could indicate to the Court that our submissions - and if I could take the Court to index Part I point 1, detail and analysis to legislative power. Although various parts of the legislation are attacked on various grounds and obviously are sought to be supported on occasion and various grounds, the Commonwealth adopt the approach in its submissions and also in our submissions today, of dealing with the various matters of power and immunity, constitutional limitation in order and in a discrete manner. Your Honours, that is, it is submitted, a convenient way for the Court to approach these issues.

In essence, if the Court pleases, we see that there are six or perhaps even seven constitutional cases here. The first deals with the conciliation arbitration power which we deal with in Part II of our submissions. The second is external affairs which we deal with in Part III, and in that there really is a subset issue, if you like, dealing with the issues of parental leave and strike, although that is part of external affairs which my learned friend, Mr Burmester, will deal with in our oral submissions.

The next issue is the corporations power, which we deal with in Part 4, and then we turn to constitutional limitations, acquisitions in Part 5, Melbourne Corporation limitations Part 6, and in Part 7, discrimination between the States. The other matter now which seems to have emerged with the intervention in support of the Commonwealth by my learned friend, Solicitor-General for New South Wales, is the issue of the validity of section 7A. It will be the Commonwealth's submission that really section 7A does not enter into the course of decision of the matters which are before it in this litigation. It would be our submission that the Court does not, in this case, have occasion to rule on the validity of section 7A, but we will come to that at the conclusion of our submissions.

If the Court pleases, the Court will notice that on page 3 and following there is an analysis of the provisions of the Act which are under attack, by reference to divisions in particular sections, with a summary by reference to the plaintiff's original submissions to the legislative powers which are referred to by the plaintiffs in their submissions and in the third column an analysis of the Commonwealth's submissions, with references to paragraph numbers in each case, indicating the basis on which the Commonwealth alleges that there is support. It may assist the Court, just for reference purposes, if I hand the Court just the photocopy of these sheets as they appear in our bound volume pages 3 to pages 10, which possibly were useful check lists for the Court when we are considering the cross references, because in our written submissions and also in our oral submissions, we will go through power by power rather than Part by Part, if the Court finds that course acceptable.

In annex 1 to our submissions we have included short extracts as to conciliation discussed in the convention debates and I will refer to that briefly when I am dealing with the conciliation arbitration power. In annex 2 we summarise the structure of Division 2 of Part VIB, which is referred to in paragraphs 2.18 and 2.31 on the certification of agreements and the purpose of that summary is to make in what is logical order a description of the process of certification rather than - I will not say disordered, but when one reads the section it is necessary to piece in what is the order of certification - the summary annexed to is an attempt to make that in a logical and perhaps chronological order.

Turning first then to the conciliation and arbitration power, in paragraph 2.1 we identify the parts of the Act which the plaintiffs in their written submissions have challenged the validity of. In paragraph 2.2 we note that we rely upon the arbitration power only in support of the following provisions. If I could indicate to the Court that we do not mean by that only and nowhere else, but we say that the conciliation and arbitration power does support these provisions but not exclusively or not necessarily exclusively.

The provisions dealing with certification of agreements in Part VIB Division 2 enable agreements reached by the parties to an industrial dispute or industrial situation to be certified and, for practical purposes, to be given the effect of an award, so the definition in section 4 includes certified agreements. This process of enabling the making of certified agreements is, we submit, conciliation. That is our principal submission. Referring to what my learned friend the Solicitor-General of New South Wales said, we do accept his submissions on this issue in paragraphs 2.1 and 2.2 in his oral submissions yesterday as complementary to our submissions. We submit in paragraphs 2.13 to 2.15 of our submissions that this is conciliation. Our alternative submission in paragraph 2.16 is that it is incidental to conciliation.

It is our submission that industrial disputes or industrial situations may be settled by conciliation resulting from the actions of the Commission, the actions of the parties or a combination of the two. In addition, in some cases the approval of a certified agreement may lead to a consensual outcome to an arbitrated dispute and therefore it would be part of the arbitration component of section 51(xxxv). So that it is not necessarily the case that conciliation occurs before arbitration; it can occur during arbitration.

The definition of "industrial situation", we submit, is within placitum (xxxv). It is:

a situation that, if preventative action is not taken, may give rise to:

(a) an industrial dispute -

although when one looks at the paragraph (b) of the definition of "industrial dispute", which does refers to situations, it may well be that there are few cases, if any, which are industrial situations within the definition of "industrial situation" which do not also fall within the definition of "industrial dispute". So perhaps there is little additional meaning in the expression "industrial situation".

Turning to the meaning of "conciliation", of course, conciliation is placed by the power in the forefront as a desirable method of ending industrial disputes. It is placed ahead of compulsive awards. Section 100 of the Act provides that disputes should be dealt with by conciliation where that is possible. The accepted meaning of "conciliation" in 1900 was the coming together of the parties for the discussion of questions with a view to an amicable settlement of differences. The legislation of the various colonies in New Zealand all provided for conciliation in industrial trade disputes and the Court has been taken to citations of those by my learned friend, the Solicitor-General of South Australia, extracts of legislation in the South Australian volume of materials and also partly in the Commonwealth's volume of materials, for example, the New Zealand Act in volume 1 tab 2 of our materials. If I could take the Court briefly to the extracts from the convention debates which comprise annex 1 of the - - -

DAWSON J: Just before you do that. Where does the interstate element come in in relation to disputes with respect to certified agreements?

MR GRIFFITH: Your Honour, I am talking about the process of conciliation. We say at that stage one does not have to have the interstate element.

DAWSON J: Why not?

MR GRIFFITH: Your Honour, it is only at the stage where one gets within the system that one has to see that there is an interstate dispute.

DAWSON J: But it has to be.....conciliation of a dispute extending beyond - - -

MR GRIFFITH: Or the prevention of it, your Honour.

DAWSON J: Yes, but you have to have some interstate dispute in prospect. As I understand this, you just have a single enterprise which reaches an agreement and there is no prospect of interstateness entering into it at all.

MR GRIFFITH: Your Honour, if one is dealing with enterprise bargains, then of course that is under the corporations power and that is a separate issue.

DAWSON J: We are talking about the - - -

MR GRIFFITH: Certified agreements, yes.

DAWSON J: Well, how do you deal with the necessity of there being an interstate element under section - - -

MR GRIFFITH: Your Honour, one mechanism, of course, is that paragraph (a) on the process of certification requires that there be an award. But, for there to be a finding of dispute as part of the process of certification, this is - - -

DAWSON J: There may be an award covering a whole lot of enterprises, which was based upon an interstate dispute - perhaps an artificial one directed by paper. But, when you are looking at a particular enterprise in a particular situation dealing with its employees, there may be no prospect whatsoever of any interstate dispute.

MR GRIFFITH: Your Honour, conciliation can prevent disputes extending beyond one State.

DAWSON J: But, you must give some meaning to the words in (xxxv), "extending beyond the limits of any one State" even in relation to conciliation, because it requires it.

MR GRIFFITH: Your Honour, perhaps if I could enlarge a bit further and come back to the problem, but what we do seek to emphasise, in due course, is the aspect of prevention which is involved. If one is involved in the prevention of disputes extending beyond the one State, our submission is one is acting within the conciliation and arbitration power.

DAWSON J: That is right, but it has to be the prevention of an interstate dispute and if there is no prospect of an interstate dispute, it does not fit within the description.

MR GRIFFITH: Your Honour, if there is absolutely no prospect of interstate dispute, that might well be said.

DAWSON J: No reasonable prospect, one would have thought.

MR GRIFFITH: Your Honour, whether or not there is a prospect can only be tested when one has the certified agreement and is considering whether or not it may be certified.

DAWSON J: Not really so. If the legislation authorises the certification in a situation in which there is no prospect of an interstate dispute, then it goes too far.

MR GRIFFITH: Your Honour, our submission is that it does not, but the inquiry is whether it is an agreement arising out of conciliation and arbitration, including the prevention of disputes extending beyond one State. But, we would submit it is not necessary to have a point of escalation to the question that there is such a dispute before one can engage the power in the prevention process, if your Honour follows me.

DAWSON J: Well, you cannot be preventing an interstate dispute if one cannot see one arising.

MR GRIFFITH Your Honour, of course, there are so many ways in which disputes - - -

DAWSON J: And when you have what you are concerned with is, by definition, one enterprise - I mean, you may have an enterprise which extends beyond the limits of the State and that is a different situation, but most enterprises, or at least a good number, do not.

MR GRIFFITH: Well, your Honour, in many if not most cases there is an existing award covering those enterprises so one has a dispute.

DAWSON J: That may be. That may have been based upon an interstate dispute artificially created.

MR GRIFFITH: Which is still in existence to support the exercise of the power, your Honour.

DAWSON J: That is unrealistic in this situation, is it not?

MR GRIFFITH: Your Honour, once one has an award that is not the end of the matter. The award may always be reopened.

DAWSON J: Are you going to say that the ambit created by the paper dispute establishes the prospect of a disagreement between one enterprise and its employees of becoming interstate. That is the way you put it, is it?

MR GRIFFITH: Well, your Honour, it may, it may.

DAWSON J: That is fairly unrealistic, is it not?

MR GRIFFITH: Your Honour, with respect, that is how interstate disputes arise. They start somewhere and then they move interstate.

TOOHEY J: But you cannot have a certified agreement, can you, under section 170MA(1) unless there are parties to an industrial dispute, and an "industrial dispute" is defined to mean an:

"industrial dispute"....extending beyond the limits of any one State.

MR GRIFFITH: Your Honour, I was working slowly to that point. I am sorry I was moving so slowly.

TOOHEY J: That may have the effect, and it presumably would, of circumscribing the range of situations in which a certified agreement can be offered to the Commission but it must necessarily be constrained by the definition.

MR GRIFFITH: Yes, your Honour, I am sorry, I was moving slowly to that, but section 170MA, could have that constraining influence but it seems to be one that goes to the constitutional jurisdiction.

DAWSON J: But you say it does not really constrain you because even there is not a dispute in existence as defined, a dispute between a single enterprise and its employees falls within (b) "the prevention of further industrial disputes"?

MR GRIFFITH: It is a question of whether one complies with the terms of section 170MA. If one does and then one produces the agreement, your Honour, we would submit one is in jurisdiction.

DAWSON J: I am sorry, I did not follow.

MR GRIFFITH: If one is within the ambit of section 170MA and there is an agreement which arises from the process, our submission is, by definition, one is within the constitutional definition. If one is not, well, then, it will not apply.

DAWSON J: That is what I am putting to you. I mean, you may have some of the parties to an industrial dispute created on paper which resulted in an award having another dispute which is solely between those parties and a single enterprise and you would say that falls within 51(xxxv), but you can only say that when you rely on the reference to "prevention".

MR GRIFFITH: Your Honour, may I approach it another way. Our submission is that this Division 2 as to certified agreements only attaches where one has an industrial dispute within the constitutional definition. That is picked up by section 4 of the Act and the terms of section 170MA. So, if that requirement is not present - - -

DAWSON J: But I do not read it that way. If you look at 170MA(1), there may be parties to an industrial dispute - that is an artificially created one - in respect of which there has been an award. If you look at 170MC(1), some of the those parties, namely one enterprise and its employees, then may reach an agreement and that agreement is certified, whether or not the dispute between the enterprise and its own employees is something in which one can see any interstate element at all.

MR GRIFFITH: Your Honour, the requirement arises from the definition of "industrial dispute" in section 4. So that if the point your Honour postulates is that that requirement of meeting constitutional jurisdiction is not satisfied, then our submission is that the provisions of Division 2 would not attach.

DAWSON J: I do not think I am making myself clear. You have to have under 170MA an industrial dispute, but that need not be the dispute which eventually leads to an agreement which is certified. In other words, you extract the parties out of the interstate situation.

MR GRIFFITH: Your Honour, it depends what you mean as the definition of "industrial dispute". That is defined in section 4 at page 30,553 of the CCH as:

(including a threatened, impending or probable industrial dispute):

(i) extending beyond the limits of any one State; and

(ii) that is about matters pertaining to the relationship between employers and employees; or

(b) a situation that is likely to give rise to an industrial dispute of the kind referred to -

So the definition of "industrial dispute" in section 170MA in this Division 2, it is submitted, does include that constitutional requirement.

DAWSON J: I follow what you say and I just put one further thing to you. It may be that you cannot carry through in this particular context the artificiality of the paper dispute creating the interstate element.

MR GRIFFITH: Your Honour, I was going to refer to remarks by members of this Court to the extent to which the conciliation and prevention power can be wider than the arbitration power and does not have the same limitations by reference to dispute. When one looks at the analysis of this Court of the issue of requirement for dispute, that is usually in the context of the arbitration phase, but our submission is in the aspect before that. When one is in conciliation - - -

DAWSON J: But you have still got to conciliate a dispute. That is what section (xxxv) says. Whilst we may have to accept to a certain extent a paper dispute, one would not in this context perhaps accept it because it carries the artificiality to an extent one really just cannot accept.

MR GRIFFITH: Your Honour, may I fit our submissions together and then revisit this, if your Honour pleases.

DAWSON J: Very well.

MR GRIFFITH: It is our submission that it is a process starting at prevention, which can be at a time when there is not a dispute or is not an interstate dispute, and that is sufficient to attach the power if it does have this aspect of connection - the prevention of an industrial dispute extending beyond one State.

DAWSON J: If you start at the other end and say what we are dealing with here is enterprise agreements and most enterprises will not cross State boundaries, then, really, to read that in the context of a paper dispute which is what 170MA really requires is perhaps not something that can be accepted.

MR GRIFFITH: I hope your Honour will come to accept the completeness of our submission. We were intending to refer to the convention debates where it seems very much, your Honour, there in the short extracts we have given in annex 1 in our submission, the particular delegates we referred to were minded to be concerned with this aspect of prevention conciliation to stop the dispute as being within the heart of the power that they were contemplating. May I continue, your Honour, and I am happy to revisit.

DAWSON J: Yes, prevention of interstate disputes, though.

MR GRIFFITH: Perhaps before I leave section 170MA, if I can make the point that the term has the definite article there - "the" industrial dispute. So, it is "the parties" to an industrial dispute, not just "some of the parties" to the industrial dispute. "Industrial dispute" with the definition requires extending beyond the limits of any one State and the requirements of MA refers to "the parties" to that dispute, not just "a party".

DAWSON J: Or any of them. So that you have ambit created by the paper, then you extract one party and an agreement between that one party and its employees having no interstate element other than the ambit created by the original dispute can have an agreement which then has to be certified.

MR GRIFFITH: Of course, to get on the issue of ambit and the artificial and unsatisfactory nature of that and how one can have an award limited to a certain State nonetheless included as resolving the interstate industrial dispute is really part and parcel of the everyday operation of the arbitration power.

DAWSON J: It may be part and parcel of the everyday operation to date, but, when one introduces a new provision such as this, perhaps one has to look at it again.

MR GRIFFITH: Your Honour, I argued three appeals in the Industrial Court last week. I must say, having done so, I agree very much with what your Honour Justice Gaudron said in the Kirby speech last year that one is dealing there with an area of the vintage car rather than the modern vehicle. It is really the deep recesses of equity practice one finds in that jurisdiction. Winging one's way through this jurisdictional area it is not a very pretty sight at the coalface but that is the mechanics of making the system work. That is not a very fair paraphrase of your Honour Justice Gaudron's remarks, but they inspired some ruminations that this Act is a very difficult Act in its operation because of these constitutional inhibitions.

Your Honours, may I take the Court briefly to these extracts that are annexed to our written submissions? They appear at annex 1, page 111 of our submissions, where each of the extracts show that the delegates had in mind that the purpose of the tribunal would be to reconcile the parties:

to prevent the possibility of strikes in the future -

to call into existence Tribunals which will prevent industrial disputes of the highest magnitude, which will conciliate the parties at the earliest possible stage -

and then Mr Kingston again at page 791 referred to in the Adelaide debates:

trying to reconcile the disputing parties, and if necessary making an award, declaring on which side the right may be.

And, similarly, on page 112, there is reference to having:

a body charged with the duty of reconciling the parties by peaceable persuasion and all the arts of conciliation, before the struggle has developed to a degree of intensity when pacific interference is worse than useless?

What we want to do is to give the Federal Parliament to bring these parties together. I do not care whether any good results come from it or not. Very often these strikes occur because the parties are not brought together -

and Mr Dobson at page 205 - this is a fine hope:

I do not see the common sense or wisdom of refusing to the Federal Parliament power to create some simple tribunal, whereby the employees on the one hand, and the employers on the other hand, could be led away in the peaceful fashion I have just described, and a strike averted, which would be fraught with danger to the whole of the Australian Continent.

DAWSON J: You see, they there refer in each of those practically to the interstate element, the whole Australian continent. The strike of the dimensions to which I referred.

MR GRIFFITH: Well, your Honour, can I keep working on this?

DAWSON J: Yes.

MR GRIFFITH: If your Honour pleases. Your Honours, at the moment I am dealing with the point made by South Australia, that it is necessary to have a third person present in the conciliation process, and our submission is that that is not a requirement, but the point of referring to the industrial legislation to which the Court has been taken of the colonies in New Zealand is that the structures there provided a statutory attempt to provide reconciliation of parties with industrial differences as a first step before the matter was treated as requiring arbitration.

So boards or councils were appointed to attempt a fair and amicable settlement of the matters in dispute by agreement between the parties, but nowhere in this legislation is it said that these boards or councils must remain in control of the dispute at that stage. So we disagree with the submission of South Australia that the conciliator must remain in control of the process if that submission is understood as including the submission that Parliament cannot legislate to give effect to an agreement of the parties by giving it the effect of an award.

BRENNAN CJ: That might be putting it too high to say that they have to be in control, but the passages which you have just cited all contain verbs which relate to the function to be performed by the third party.

MR GRIFFITH: I am aware of that, your Honour.

BRENNAN CJ: Is that not the problem you have to deal with?

MR GRIFFITH: Yes, your Honour, and we intend to deal with that, your Honour. Firstly can I take the Court briefly to what Justice Isaacs said in Whybrow's Case, Australian Boot Trade Employee's Federation v Whybrow [No 2] [1910] HCA 53; (1910) 11 CLR 311. At page 335 Justice Isaacs said:

The Constitution leaves to Parliament the most absolute choice as to the form of tribunal and its procedure; the conciliating and arbitrating organ may be a Court, or a layman, a committee of strangers, or a combination of representatives of the parties concerned, its method of action may be voluntary, or compulsory; unanimity or majority of opinions may control its decisions -

and he refers to the fact that:

there must be some disagreement, some want of harmony calling for the exercise of those offices.

Justice Higgins at page 340 said at about point 2, referring to the constitutional power. It:

is not technical; it is couched in vague and popular terms, and it leaves to the Federal Parliament the function of saying under what circumstances and in what manner the power of conciliation and arbitration is to be exercised.

And further down the page at about point 5:

but it by no means follows that there cannot be steps taken for conciliation, or even for arbitration, before the dispute has become definite, and before the persons concerned in the industry have taken definite stands or made definite claims. No one who is at all familiar with the genesis of great industrial disputes can be ignorant of the general uneasiness, unrest, the individual grumbling, the dissatisfaction, often indefinite, which precede the ultimate quarrel; and to this stage, before matters have come to a head, the power of conciliation or arbitration for prevention seems to be directly applicable (so far as the Constitution is concerned). No doubt, it would be difficult for a Court, under the Act as it stands, to bind persons by an order or award unless they come before it as claimants or respondents on a definite claim; but it is for Parliament to say how persons are to be notified of proceedings, and what persons are to be bound by an award. This is a mere matter of procedure, to be determined by the Act; it is not a matter affecting jurisdiction under the Constitution. The ordinary meaning of the word "prevention" involves the warding off of something before it happens; and so long as that thing is an industrial dispute (extending) which is possible - or, at least, probable - and so long as the law is directed to prevention of such a dispute by the only methods allowed - conciliation and arbitration - I see no reason why the law should not be valid.

So our submission is that the power itself does not require conciliation to be first controlled or exclusively controlled by a conciliator or mediator. It must be sufficient that the conciliation has a supervisory role and we submit that is the case under this legislation. So, for example, could I take the Court to section 170QK, page 32,603, where my learned friend, the Solicitor-General for South Australia, took the Court briefly to the subdivision B of Division 5, but one sees that there are statutory provisions providing for the Commission to be involved as appropriate in this aspect of negotiations which may lead to a certified agreement. If I could take the Court also to section 170QH, which provides for the application of this subdivision in cases where:

the Commission becomes aware that:

(a) a party to an industrial situation wants to negotiate, or is negotiating, with any other party or parties to the situation, an agreement under Division 2 for preventing the situation from giving rise to an industrial dispute between them -

and then there is an extension to constitutional corporations. Section 170QH(2) provides:

The Commission may try, by conciliation, to facilitate the making of such an agreement if it considers that conciliation by it would facilitate the making of such an agreement.

So there is a capacity for the Commission to come in and be involved in a mandatory way. The Commission is required to decide promptly if either party to that situation asks the Commission to exercise power. It has to decide as quickly as it can whether or not it can respond to this and then the various other provisions of this subdivision apply, if I could refer to section 170QI. I have already referred to section 170QK. Section 170MC is also relevant, dealing with the certification of agreements. That is page 32,201. It is clear when one looks at section 150MC this is no mere clerical function.

McHUGH J: That may be, but the fact is that there is nothing to conciliate at this stage. The parties have reached their agreement themselves and, at least in some cases, the legislation provides for them to make an agreement among themselves without getting near the Industrial Relations Commission and then they come along and they say, "Here is this agreement. Certify it." What has that got to do with conciliation?

MR GRIFFITH: Your Honour, they cannot stay away. They have to come eventually for the agreement to be made valid.

McHUGH J: I know they do, but it does not seem to me to have anything to do with conciliation. There is nothing to conciliate; the dispute has ended by hypothesis.

MR GRIFFITH: Not exactly, your Honour, because (a),there is a process that either you agree with all these matters or the Commission become involved in the process. That leads to an agreement which is sought to be certified, and certification is not automatic. In the Musicians' Union Case [1912] HCA 89; 15 CLR 636, agreements under section 73 of that Act, there was a requirement to register. The Court had no discretion. But here, your Honour, one has the check list of section 170MC which must be satisfied. The Commission must tick off each of these matters and see that it is satisfied of it and it is involved in the process. The process of conciliation is the complete process leading from the discussions in the aspect of preventing a dispute to the final stage which is a certified agreement alternative to an arbitrated result.

McHUGH J: If the Commission gets involved under QH at an early stage and away the parties go, no doubt they are right at the heart of the constitutional power. But the difficulty I have at the moment, Mr Solicitor, is that this legislation contemplates parties making their own arrangements and then coming along to the Commission saying "Certify this agreement". The Act says you must certify it if certain things are done and you must not certify it if certain things are not done, full stop. Whatever it is, it does not seem to me to have anything to do with conciliation or arbitration. It is almost an exercise of judicial power.

MR GRIFFITH: I do not wish to get into Chapter III, your Honour. My learned friend says he cannot or he will not - I am not sure which. Our submission is that one must look for the purpose of the conciliation and arbitration power which is not just for the purpose, we submit, of conciliating and arbitrating disputes which are interstate which are in existence, but for preventing them.

Putting the submissions made against us together, it does seem to us that the point is made that in this aspect of preventing by conciliation and arbitration interstate disputes, it is suggested that if the process of prevention is one which works so that these disputes really are prevented as was intended, then the power by definition cannot attach. The power can only attach if one has the processes of the interstate dispute to the point where one can say there is an interstate dispute identified sufficiently for conciliation to attach or, if that fails, arbitration to attach.

McHUGH J: I know, but if, for example, the legislation seized on an industrial situation as defined and said, "When it arises, you must notify the Commission" and the Commission must then become involved, you would be a long way in front but that is not the way the legislation operates.

MR GRIFFITH: Your Honour, may we emphasise again the aspect of prevention. In fact, I was reminded when I was musing on this last night of the film "The Graduate" where Dustin Hoffman appeared and one remembers him speaking to Mr Robinson and Mr Robinson said, "I'll say one word to you, boy, `plastics'". I do not want to take that little incident too far but, in this aspect, our submission is that the one word here to be emphasised is "prevention", that we are dealing with the aspect, the social interests of preventing industrial disputes extending beyond one's State. If there are such- disputes extending beyond one's State. If there are such - - -

McHUGH J: Regrettably, from your point of view though, is that there is only one way you can do it, by conciliation or arbitration.

MR GRIFFITH: Your Honour, preventing the disputes by conciliation and - - -

McHUGH J: That is not the constitutional power. It is prevented by conciliation or arbitration.

MR GRIFFITH: Your Honour, I suppose we would submit it is an unhappy state of affairs if one is successful in doing that, that being able to prevent at the first stage, that referred to by Mr Kingston and others on the basis that you are being too effective too early; you have to let it escalate before a reasonable use of the power attaches. Now, if that is what the Constitution provides, that is how the Constitution operates. But, our submission is that that is a very narrow and confining reading which, given the constitutional limitations and those technicalities, in our submission, does not give enough work to the aspect of prevention which is that, as long as one can see there is this process, that if it is not stopped under the aegis of the Act effectively, one will get to the point of an industrial dispute that does extend beyond one State, then - - -

DAWSON J: Mr Solicitor, I think I could understand it if we had a concrete situation. Would this be possible: that you have XYZ Pty Ltd that has 100 employees which is a party to an award which was created on paper, if you like, and within the award deals with wages. XYZ Pty Ltd reaches an agreement with its 100 employees as to an increase in wages which they are to be paid and it is restricted to that particular enterprise and they then go along and they satisfy the criteria in the Act and then the Commission is required to certify the agreement. Now, you say that is justified on the basis that it is preventing conciliation for the prevention of an interstate dispute?

MR GRIFFITH: Yes, your Honour, it probably will be as coming within the definition of "industrial dispute" of section 4.

DAWSON J: That is possible under the provisions, is it not?

MR GRIFFITH: Yes, it is.

DAWSON J: And in reaching the agreement XYZ Pty Ltd and its 100 employees have no regard for anyone else or their conditions, confine their attention entirely to the particular enterprise.

MR GRIFFITH: The aspect of certified agreements requires certification against certain matters that do not include national - - -

DAWSON J: That is a possibility, is it?

MR GRIFFITH: Yes, your Honour, yes.

GAUDRON J: And you may add to that that if they cannot settle their disputes that way their alternative under the existing arrangements is to agitate for support from other employees in the industry or employed by companies parties to the award to get a new award covering everyone which is truly - - -

DAWSON J: Which is to create an industrial dispute?

GAUDRON J: Yes.

MR GRIFFITH: Yes, that is so, your Honour Justice Gaudron, and really that emphasises the point we desire to - that the function of the structure of the legislation is to avoid and prevent that situation of agitation arising because it is required by the constitutional structures reflected in the legislation. Of course, there is a requirement for an industrial dispute to be notified to the Commission under section 170QJ which one sees at page 32,603 of the CCH series. Even if it concerns a certified agreement you still should notify the dispute, and we have already referred to section 170QK which enables the Commission to give wide - it has wide powers to give directions in conciliation certified agreements. That appears at page 32,603.

May I take the Court to a few other statements of Justices of this Court which we would wish to rely on to support what we say is a particular emphasis which should be given to the power to prevent the occurrence of industrial disputes. Our submission is prevention is the warding off an event before it happens with the result that the event may never occur. We submit that steps directed at the conciliation of grievances which may give rise to an industrial dispute which is interstate are authorised by the constitutional power.

We referred to Whybrow's Case and may I take the Court also briefly to the remarks of your Honour Justice Brennan and Justice Deane in Cadbury Schweppes which is R v Bain; Ex parte Cadbury Schweppes [1984] HCA 9; 159 CLR 163. The Court has already been referred partly to this particular page 176 by my learned friend the Solicitor-General for South Australia, but may I take the Court to the rest of that page, the part he did not read. Perhaps if I start in the middle of the page. My learned friend read the first sentence, I think, of this paragraph:

Once the stage of arbitration is reached, the ambit of the particular interstate industrial dispute is the yardstick for measuring the constitutional validity of an award made in exercise of the Commission's arbitral functions. That is because the ambit of the dispute determines the limits of the jurisdiction of an arbitrator to bind the parties by his award. Those limits are derived from the nature of arbitration; they do not circumscribe the functions of a conciliator who is at liberty to assist the parties themselves to avoid or settle a dispute by an agreement which ventures beyond the ambit of their prospective or actual dispute. If the functions of an industrial conciliator were circumscribed by the ambit of a prospective or actual dispute, they would lack the flexibility and sophistication exhibited even by the conciliation processes of primitive tribal societies.....The decisions of this Court in which the limits of arbitral power have been stated by reference to the ambit of disputes may be given too wide a significance if they are assumed to state in the same way the scope of the legislative power with respect to conciliation under section 51(xxxv) of the Constitution or the scope of the conciliation powers of the Commission under the Act.

And your Honours there refer to Justices Isaacs and Rich in Federated Clothing Trades Case.

Since that question was not examined in argument in the present case however, we refrain from forming any concluded view upon it.

So, in our submission, this placitum extends to authorise laws with respect to conciliation and arbitration for the prevention of industrial disputes in the abstract, and may I refer, in that regard, to what your Honour Justice Deane, who is not present today, Justice Gaudron and Justice McHugh said in O'Toole v Charles David Pty Ltd (1990) 171 CLR 232 at page 288. There at about point 3 their Honours said:

The statutory powers conferred by the Act upon the Commission are confined to the settlement and prevention by conciliation and arbitration of interstate industrial disputes which have at least progressed to the stage of being "threatened", "impending", "probable" or "likely".

And further down the page about point 6:

It would seem that those statutory powers are more narrow than could have been validly conferred by legislation enacted pursuant to par.(xxxv) in that that paragraph extends to authorize laws with respect to conciliation and arbitration for the prevention of interstate industrial disputes in the abstract.

So, again we disagree with South Australia's submissions, if they extend to contending that before conciliation can occur there must be a dispute identifiable to parties in disagreement over identifiable subject matter, and we refer to paragraph 3.6 of South Australia's principal submissions.

In R v Federated Storemen and Packers Union of Australia; Ex parte Wooldumpers (Vic) Ltd [1989] HCA 10; (1989) 166 CLR 311 at page 328 Justice Deane said at about point 4:

If the Constitution means what it says when it confers a broad power to make laws with respect to conciliation and arbitration for the prevention of interstate industrial disputes in the abstract, it is far from evident either that there is any constitutional need to make the manufacture of an interstate dispute, whether paper or real, a condition of the existence of jurisdiction conferred pursuant to that grant of legislative power or that it would not suffice for constitutional purposes if, for example, the grant of jurisdiction to an expert tribunal such as the Commission were merely conditioned upon the opinion of the tribunal that circumstances exist in which the tribunal's conciliation or arbitration procedures may be conducive to the prevention of interstate industrial disputes.

DAWSON J: What, is the prevention of interstate industrial disputes in the abstract?

MR GRIFFITH: This is a reference back to Justices Deane, Gaudron and McHugh.

DAWSON J: I know it is a reference back, but what does it mean?

MR GRIFFITH: It is, of course, difficult for us to answer an interrogatory with another interrogatory but, in our submission, the meaning of that sentence is plain enough, your Honour, to say that one must be concerned with the issue of finding the requisite connection with an industrial dispute to the sufficient probability "of being `threatened', `impending', `probable' or `likely'", as referred to in the first sentence we read from page 288, but also, your Honour, that the constitutional power to engage in the process may be attached without having advanced to the point of saying, "Yes, we have identified an industrial dispute and it is a dispute which we can see clearly satisfy the requisite requirement of being interstate."

DAWSON J: Yes, but I just do not understand how you can conciliate a dispute in the abstract, that is all, or arbitrate a dispute in the abstract for that matter.

MR GRIFFITH: Your Honour, we would like to say you can prevent a dispute.

DAWSON J: In the abstract?

GAUDRON J: Yes. You can conciliate or arbitrate to prevent a dispute. They are the words of the Constitution.

DAWSON J: In the abstract?

MR GRIFFITH: We might be getting into a philosophical area, your Honour, of when does the dispute start. We get back to they often start, as Justice Higgins referred to and some of the delegates, your Honour, at a very early stage before they crystallise, but we do - - -

DAWSON J: But there has to be something in prospect which is concrete and not abstract.

MR GRIFFITH: You start, I suppose, your Honour, with the relationship and move forward and things develop, but it is a matter of - - -

McHUGH J: His Honour may be using "abstract" in the sense of hypothetical. If you have stop work meetings in a couple of States, there is no reason why the Commission could not then take action. There may be no actual dispute with the employers, but the signs may be there that an industrial dispute is only a few days away, so in it goes.

MR GRIFFITH: Your Honour, we would add one State would be sufficient for that purpose.

McHUGH J: Yes, provided it was likely to spread interstate.

MR GRIFFITH: Yes, your Honour, but one problem is to identify any dispute in this context if it is with the umbrella of award already made particularly which does not have that requisite character.

BRENNAN CJ: But there is no doubt about the existence of the jurisdiction to conciliate an industrial dispute as defined. The problem here is whether or not there is any function for the Commission to perform at a stage before an industrial dispute gets to the stage of answering the statutory description because subsection MA(2) deals with industrial situations.

MR GRIFFITH: Well, your Honour, we have already made the point that "industrial situations" do not seem to have any wider meaning than the definition of "industrial dispute" in section 4.

BRENNAN CJ: But they surely must. The language is different and the language has a significant difference of being likely in the definition of "dispute" and may in the definition of "industrial situations", but I wonder, having heard your argument, why you do not put the proposition that the arrangement for certification is in aid of the power of conciliation and arbitration and incidental to it, rather than being part of it, or perhaps being part of the main thrust of it.

MR GRIFFITH: I was hoping, firstly, that that was implicit in what I said, but also, your Honour, I was intending to advance into this aspect of looking at the certification processes, and to do just that, I hope, your Honour. I refer to the fact that we analysed the structure of the provisions dealing with certification in annexure 2, pages 113 to 118 of our submissions, and we submit the effect of these provisions is to enable an amicable agreement to be reached between prospective or actual parties to a prospective or actual dispute or to industrial situation and to give legal effect to their agreement.

This aspect, in our submission, must be characterised, at the very least, as incidental to the process of conciliation. The provisions for certified agreements, we submit, are authorised both by the power of conciliation to prevent or settle interstate industrial disputes and, if necessary, by the incidental power contained within both the arbitration power itself and also in the incidental power. We deal with our submissions, as I mentioned to the Court, on incidental power in paragraph 2.16 of our submissions, and may I give the Court also the reference to Federated Ironworkers Association v Commonwealth [1951] HCA 71; 84 CLR 265, at page 277?

The objects of the Act, particularly in section 3.1 to which the Court has been taken, and section 88(e)(ii) of the Act, identify the purpose of the Act in dealing with certified agreement. That is page 31,104. Section 3(a) of the objects, it would seem, refers to the Act as having an object to include:

encouraging and facilitating the making of agreements, between the parties involved in industrial relations, to determine matters pertaining to the relationship between employers and employees, particularly at the workplace or enterprise level -

and section 88A(e)(ii) provides that an object of Part VI of the Act is that:

(e) the Commission's functions and powers in relation to making and varying awards are performed and exercised in a way that both:

(i) gives employees prompt access to fair and enforceable minimum wages and conditions of employment, so far as they do not already have them; and

(ii) encourages the prevention and settlement of industrial disputes by the making of agreements under Part VIB.

And we submit that the certifying of the parties' agreement, by itself, must be at least incidental to the role of conciliation.

The certified agreement provisions permit the parties to an industrial dispute, or to a potential industrial dispute, to resolve their differences by an agreement within a framework which requires Commission approval. I have already taken the Court to section 170MA which requires that the Commission can only certify agreements reached by the parties to industrial dispute or industrial situation. I will not take the Court again to the definitions, but the preventative aspects of placitum (xxxv), which we say are not limited to disputes within existance but extend to situations which may develop into disputes, is sufficient to enable the constitutional power to engage. Section 170MA(1) requires it to be an industrial dispute. When the Commission becomes aware of that it is required under Division 2 of Part VI to make a finding of an industrial dispute, section 101; and to conciliate where that is appropriate, section 102 and section 103.

It is not the case that the provisions as to certified agreements are a dichotomy, as it were, in substitution for the fact that where there is an industrial dispute the ordinary provisions as to arbitration and conciliation may apply. It is not a question of bypassing the Act to substitute under Division 2 a system of collective bargaining. What Division 2 rather does is permits the parties to industrial dispute to resolve differences by agreement within a framework of requiring Commission approval to the agreement. Our submission is that it is part of an overall structure of the Act providing for an effective mechanism for the dealing with disputes extending beyond one State on the basis of resolving them by conciliation or arbitration; admitting that the primary function is to have resolution by conciliation, or effectively, by agreement of the parties.

The history of certified agreements is contained in volume I of divider 1 of our materials. I will not take the Court to that history, and South Australia also has provided its own version of a history to the Court.

It has never been doubted that the arbitration power permits the Parliament to give effect to the agreement of the parties so that it has binding force. Recent cases, such as Wardley's Case [1980] HCA 8; 142 CLR 237; Cadbury Schweppes [1984] HCA 9; 159 CLR 163, which I have referred to, are examples of cases where the validity of certified agreements have been assumed. In Wardley's Case, 142 CLR at page 278, Justice Aickin, after referring to a passage of the Court in Robinson (T.A.) and Sons Pty Ltd v Haylor in a 1957 decision said, after reciting a passage:

That passage also provides authority (if it be needed) for the proposition that, for the purposes of s. 109, an agreement certified under s. 28 of the Conciliation and Arbitration Act stands in the same position as an award.

South Australia seeks to lessen the significance of this history of certified agreements by asserting in paragraph 3.16 of its first submissions and paragraph 5 of its summary that when one looks at these matters they all dealt with agreements reached while conciliation was on foot. This was not stated as a requirement in the legislation itself. Rather, the legislation provided for a certified agreement and consent award. So, for example, in the 1972 Conciliation and Arbitration Act, section 28 provided:

If, before an industrial dispute has been referred to arbitration in accordance with this Act, the parties to the dispute or any of them reach agreement on terms for the settlement of all or any of the matters in dispute -

So, the critical point, when one goes back to the history and say, to the Musician's Case, is that the 1904 Act provided for two types of agreement; one might have a section 24 agreement or a section 28 agreement. That really was an ancestor to certified agreements which was always regarded as valid, and we refer to what Justice Aickin said in Ansett Transport Industries, making that assumption.

That is one aspect of certified agreements which have a long history going back to the 1904 Act and which, by their terms, permitted a mechanism for certification of agreements made by the parties and brought to the court. Section 73 or Part X agreements as were dealt with in Musicians' Case were somewhat different. They, in fact, became a dead letter in the Musicians' Case,. Justices Isaacs, Higgins and Barton adopted the literal terms of section 73 to provide for the agreements to provide for conciliation and arbitration and, in effect, to oust the jurisdiction of the court in the future and eventually in Smith, that was held to be something which could not apply.

May I hand the Court an article by McCallum and Smith, which is reported in 1986, the Journal of Industrial Relations, page 57 which we refer to as giving some of the contemporary atmosphere, if we could put it, of the times. This article traces the history of section 73 or Part X agreements and their demise because of the insistence on the literal requirements of the section that the agreements actually had to provide for conciliation and arbitration. When one looks at the italicised summary, one sees that these agreements were regarded with disfavour because the Arbitration Court would lose power if there was this opting out. In the early 1910s and following, it was a matter of threatening the existence of the arbitration system and it is noted in the italicised summary that:

In response, in 1913, the High Court (greatly influenced by Isaacs and Higgins, who were themselves ardent supporters of arbitration) effectively put an end to `opting out' by severely limiting the scope of Part X.

So, in essence, when one looks at the debate of the Musicians' Case and when one sees how it was resolved three years later, in our submission, one is dealing with the High Court grappling with what they saw as a threat to the arbitration system. But, they were doing it entirely in the context of section 73 agreements and this problem that section 73 agreements were threatening the arbitration system itself. But the section 28 agreements, the certified agreements which we say, in effect, are carried through in an improved form in this part of the Act, really, the forerunners of these certified agreements, were always accepted as being a part of the aspect of the exercise of the arbitration power.

It is important also to note that there is a link between certified agreements in arbitration and we refer to paragraph 2.21 and 2.22 of our submissions. During the course of the arbitration proceedings, parties may resolve their differences and wish to embody their agreement in a certified agreement and Division 2 of Part VIB enables this to occur so that certified agreements in this way may be incidental to arbitration. It is a common enough occurrence in practice for contested matters to be resolved after argument and disagreement have proceeded some distance.

So, these provisions which were introduced in the Act in 1993, in our submission, are not the creation of a new and parallel system, but rather an extension of existing conciliation processes which use the aspect of certified agreements under section 28 but making full use of the conciliation and arbitration power in a way in which references - I have taken the Court to some of them of Judges in this Court in judgments - have indicated the Act previously did not fully engage the constitutional power.

BRENNAN CJ: Mr Solicitor, I am puzzled at a more basic level, I must confess, in terms of how it is that persons who are not, apart from the provisions of the Act, bound by an agreement and who have not been involved as parties in what is an interstate industrial dispute can have their rights affected by exercise of State power when there has been in fact no dispute answering the description of 51(xxxv) that has been conciliated.

MR GRIFFITH: Your Honour, if one postulates that there is no dispute as that term is constitutionally required - and we extend that to the aspect where there is a possibility of dispute so that it does not come within the aspect of meeting the description of "industrial dispute", concerning conciliation of industrial dispute, the prevention by conciliation and arbitration of industrial disputes extending beyond one State - one must then get to the position that one could not come in through section 170MA and could not in that way get the agreement certified.

BRENNAN CJ: Who are the parties to this preconciliation stage of a dispute? Let us assume that there is some dispute in a factory in one of the major cities with reference to some subject matter that, conceivably, could lead to a widening of a dispute geographically so as to engage the 51(xxxv) power. It is a localised dispute. Let us assume there is a shop steward there. Who are the parties if it is patched up on the spot?

MR GRIFFITH: Your Honour, if it is patched up on the spot it would be - well, there could be several parties. There could be the union, because the union is entitled to participate in these processes.

BRENNAN CJ: Why is it? I can understand how a union participates to bind its members in a dispute under the statutory power but, if there is a local dispute which has not at that stage gone interstate, how does the union get any status to bind its members?

MR GRIFFITH: Your Honour, in many cases unions come in at that level. That is the function of the union: to resolve disputes.

BRENNAN CJ: I have no doubt it does, but what if there are dissentients? There is a meeting on the shop floor. The majority say this; the minority say something different. What binds the minority? How does the State power intervene through this methodology to bind the minority as to their rights and obligations?

MR GRIFFITH: Your Honour postulates a situation where one would think it unlikely one would get a certified agreement from that sort of situation, but could I take the Court again to what Justice Higgins said in Whybrow 11 CLR 340. I have already referred the Court to this. Your Honour, what Justice Higgins says at about point 5:

An order or award cannot be made except as against identified or identifiable parties; but it by no means follows that there cannot be steps taken for conciliation, or even for arbitration, before the dispute has become definite, and before the persons concerned in the industry have taken definite stands or made definite claims.....No doubt, it would be difficult for a Court, under the Act as it stands, to bind persons by an order or award unless they come before it as claimants or respondents on a definite claim; but it is for Parliament to say how persons are to be notified of proceedings, and what persons are to be bound by an award.

So that, your Honour, it then refers to the aspect of prevention. Now, our submission is that in that situation one has to, by the definitions of section 4 and the definitions of section 170MA, see that there is the requisite aspect of constitutional connection and once that is present, your Honour, then the power validly may be exercised. If it is not present, then in the circumstance your Honour postulates, one would not get that agreement certified. There is a limitation on the certification procedure requiring satisfaction of the existence of the constitutional requirement brought in by the definitions of the terms of section 170MA and the definitions in the Act, in our submission.

BRENNAN CJ: The passage later on that page:

No doubt, it would be difficult for a Court, under the Act as it stands, to bind persons by an order or award unless they come before it as claimants or respondents on a definite claim -

now, this proposes that before the dispute stage is reached, but at a stage where a dispute might eventuate, there can be an intervention by the Commission certifying an agreement so as to bind those who have been involved in the situation.

MR GRIFFITH: Your Honour, we would say this is a perfect example of prevention of work and that when it comes to the Court - we referred also to the various statutory requirements before one gets certification - that one can in that situation say that in effect what happens by the certification process that one has an award. The definition of "certified agreement" includes awards, your Honour, which does exactly that. It has the effect of, between claimant and respondents, resolving the claim on a definite basis. So that the requirement of Justice Higgins, in our submission, is squarely satisfied by the making of that order in circumstances that, we submit, are limited to access being provided only through the constitutional requirement, whatever that means, because of the ambient difficulty of dealing with prevention and dealing with potential disputes rather than ones that have come into fruition, particularly ones dealing with conciliation rather than arbitration, but that is a process, we say, to be engaged in at the level of Commission and if it falls into error by exceeding its jurisdiction then the remedy is available. Fortunately this Court does not any longer have to follow through itself, it can remit it to another court, but the process of ensuring the limitation of power is there.

DAWSON J: But it just is not, if you will forgive me for putting it as definite as that, because the only jurisdictional requirement is that the parties who are engaged in the enterprise bargaining should have been parties to an award, to which there may have been many other parties.

BRENNAN CJ: Which might have settled the dispute.

DAWSON J: Which might have settled the dispute. So the constitutional requirement is not there, and if I could just add something for your comment, the whole philosophy of certified agreements is that it is better to proceed on a strictly local basis rather than the basis on which the other provisions of the Act proceed.

MR GRIFFITH: We have already made a submission that if that is the case then under the Act it has been wrong since 1904, in effect, because certified agreements in various - - -

DAWSON J: Well, they may be able to proceed on a local basis, too, but that has had a history, but these provisions are that instead of proceeding upon, as it were, a national basis or an interstate basis, you concentrate your attention on the particular enterprise which is at least suggestive of the fact that one disregards the provisions of section 51(xxxv) to some extent.

MR GRIFFITH: Your Honour, we submit that that is not so. We have referred constantly to the definitions.

DAWSON J: But the definition does not help you because the definition is only brought in in relation to the existence of an award, but that is in relation to something different.

MR GRIFFITH: With respect, we would say it is somewhat wider than that in section 170.

DAWSON J: There is nothing in, for instance, section 170MC, a requirement that the Commission find that if this agreement is not certified it is likely to escalate into an interstate dispute. And to put it that way, of course, is to demonstrate that the constitutional requirement has been disregarded.

MR GRIFFITH: We would wish to emphasise that the access is through 170MA, that one just does not go to MC in its pure form.

DAWSON J: 170MA is very restrictive in the way in which it applies.

MR GRIFFITH: We would submit restricted to ensure that it has a constitutional base as access to Division 2.

DAWSON J: Would it not be better, and would it not be much clearer, if that was really what was intended, that one of the requirements of 170MC should be that this is likely to escalate or possibly will escalate into an interstate dispute if the agreement is not certified?

MR GRIFFITH: With respect, your Honour, the statute need only state a matter once. We would submit that is picked up from the definitions.

DAWSON J: We have been through this.

MR GRIFFITH: Yes, we have, your Honour. The other thing we would say, and we will say something about it later, that one should not assume that in this attempt to ensure, we say, prevention, that it is not Parliament's intention to confine itself to the exercise of constitutional power. Here we are dealing with the conciliation power on this point, and, in our submission, one should read Division 2 and the definitions together and not just merely go on sections such as MC dealing with one aspect and say, "Well, this section doesn't emphasise what we say is the threshold entry requirement". But, accepting as we do, your Honour, that one takes a very broad view of the situation where prevention may attach in the constitutional sense of meeting the requirement of placitum (xxxv). We have said sufficiently what our submissions are on that point.

So, to draw our submissions together, we do submit that it is sufficient if there is agreement made between parties to bring that to the court for the purposes of certification to say that that meets the requirement of conciliation. It is not essential that there be participation by the Commission at an earlier time, although we have referred to the various provisions of the Act which deal specifically, and also generally, with conciliation which mean that there is a structure for engagement at any time during the course of what might be negotiated by the parties and brought to the court. And that the existence of that capacity to facilitate, for reasons I have referred the Court to, together with the process of certification which in itself we separately submit is incidental to the process of conciliation is, in our submission, sufficient to say that this division is within the power.

On the process of being incidental to conciliation may I give the Court another reference, that is to the Federated Ironworkers' Association v Commonwealth [1951] HCA 71; (1951) 84 CLR 265 at page 277. There the Full Court said:

Everything which is incidental to the main purpose of a legislative power is contained in the grant of the power itself. Thus the power to make laws with respect to conciliation and arbitration for the prevention and settlement of two-state industrial disputes carries with it authority to make such provisions as are incidental to the effectuation of the purpose described by the express words of the power.

And we submit that what is provided here is designed entirely to ensure that there is an avoidance, a prevention, of industrial disputes, that they are resolved by agreements fully under the aegis of the procedures of the Act, including a requirement that certain statutory provisions be complied with in addition to the other requirements that at any time the Commission may come in and be involved with the process, and our submission is that that is comfortably within constitutional power, giving due emphasis as we do to the aspect of prevention and giving due emphasis to the aspect that this legislation clearly does attempt, in the context of the history of registered agreements, certified agreements running back to 1904, gives full effect to what we submit is the aspect of the constitutional power, which has not been exhausted by the structure of the legislation, as has been noted by some of the Justices of this Court hitherto.

May I turn then to issues of immunity from civil liability. These are dealt with in pages 20 to 29 of our submissions. The plaintiffs assert that Division 4 of Part VIB confers immunity from civil liability for negotiating an agreement where that process does not involve conciliation and arbitration. Of course, this is a Part which is supported by giving effect to treaty obligations, but at the moment I confine myself to dealing with the aspect of the conciliation and arbitration power. It is our submission that that power permits Parliament to conclude that it is necessary to provide specific legislative protection for the right to strike, subject to limitations compatible with the existence of the right, in situations where there exists an industrial dispute involving an employer and one or more organisations, members of which are employed by an employer to perform work in a single business or part thereof, or a single place of work and are covered by an award[cedilla] and the employer or one or more of those organisations are negotiating a certified agreement, as is provided in section 170PA(2).

Section 170PC at page 32,454 provides that this Division 4:

applies if:

(a) the Commission has found that an industrial dispute exists; and

(b) the dispute involves a particular employer and a particular organisation or organisations of employees; and

(c) wages and conditions of employment of employees who:

(i) are employed by the employer; and

(ii) are members of the organisation or one of the organisations;

are regulated by one or more awards.....that bind the employer; and

(d) all or some of those employees are employed by the employer in a single business or a part of a single business or at a single place of work.

This Part provides immunity from civil liability where a party to industrial dispute who wants to negotiate a certified agreement initiates a "bargaining period". That is section 170PD(1). An industrial action is only protected during that bargaining period. The immunity is provided by section 170PM. We deal with the structure of this Division in paragraphs 2.42 to 2.44 of our submissions and also in annexure 2. This bargaining period may be suspended or ended in specified circumstances, section 170PO, and the Commission may direct that the bargaining occur in good faith, section 170QK(2). The bargaining process is under the general supervision of the Commission and we submit that it is conciliation or incidental to conciliation. In our submission, Parliament is entitled to conclude that immunity from civil proceedings for limited periods will help prevent or settle industrial disputes.

We also submit that it is within Commonwealth power to prohibit strikes or lockouts to ensure the effective execution of the conciliation and arbitration power. Strikes or lockouts are likely to exacerbate the industrial situation. We refer to this in paragraph 2.37 of the Commonwealth's submissions, and my learned friend the Solicitor-General for South Australia referred to Stemp v Australian Glass Manufacturers [1917] HCA 29; (1917) 23 CLR 226, where, at page 244, Justice Higgins said:

In my opinion, the prohibition of strikes is a law "with respect to" the subject of pl xxxv.

He regarded it, in any event:

as a "matter incidental to the execution of the power"......It would be enough to show that Parliament might reasonably regard the prohibition as tending directly to make the tribunal's operations more effective; and in this case no one, I should suppose, can deny that the prohibition actually has this result.

So, in our submission, it is not a matter that goes one way, that it is incidental to the execution of the power to prohibit strikes but it is not incidental to the power to make other provisions, as are appropriate, for the variation of what might be the operation of the civil law with respect to industrial action during this period of bargaining.

When one looks at the material which is included in South Australia's folder, the Western Australian Act, in volume 2, divider 10, page 11, of 1900, provided in section 30(1) that there could be prohibition of strikes or lockouts when an industrial dispute was referred to a board or court. We refer also to other legislation in paragraph 2.38 of our submissions.

In any event, the power to regulate the affairs of an industrial organisation is wide and includes restricting or adding to the rights of corporate entities. May I refer the Court, without reading it, to the judgment of Justice Gibbs in the Reg v Bowen; Ex parte v Amalgamated Metal Workers and Shipwrights Union [1980] HCA 42; 144 CLR 462, at 471, but this aspect we elucidate in paragraphs 2.39 to 2.41 in our submissions.

Turning then to restrictions on actions in respect of boycott conduct, particularly sections 164, 166 and 166A, these are referred to in pages 24 to 25 of our submissions, paragraphs 2.45 to 2.53 of the submissions.

McHUGH J: The form of your submissions seem to have departed from the form they usually take. The headings are topic headings rather than the argumentative headings containing a proposition, which you usually find in the Commonwealth's submissions. Speaking for myself, I much prefer the argumentative heading and then the paragraph that develops the argument after it.

MR GRIFFITH: Your Honour, we do too. It is just a difficulty with this case that we had three or perhaps four various claims made against us which divide into subject matter. In the end it seemed to us that subject matter was the way to go, but we hope thereby it is not misleading to the Court - - -

McHUGH J: No, but it is much easier to grasp when you get the context first, detail later.

MR GRIFFITH: Your Honour, the difficulty with this case is that there is so much legislation that, unless one identifies the target, it becomes harder to put one's propositions to it. But thank you for the criticism, your Honour.

McHUGH J: It is just a comment, Mr Solicitor.

MR GRIFFITH: We hope at least our table is very useful for seeing what the line-up seems to be on these provisions. Our submission is that Parliament may enact laws with respect to secondary boycott. We refer to Actors and Announcers Equity Association v Fontana Films Pty Ltd [1982] HCA 23; 150 CLR 169. Parliament may provide that the remedies in respect of secondary boycotts are to be those provided under federal law. So the effect of section 164 is that, save for cases of personal injury or damage to property or defamation, the remedies available against secondary boycotts are those under Division 7 of Part VI and not under common law or under other statutes. The boycott provisions of course affect the trading activities of constitutional corporations, and we deal with that in paragraph 4.17 of our submissions under the corporations power.

Section 164 provides that the remedies provided for in subdivision E cover the field in relation to legal remedies in respect of boycott conduct to which the Act applies. Western Australia's point made yesterday seemed to be that section 164 grants immunity from conduct that is excluded from boycott conduct; for example, section 162A, "peaceful picketing". But we submit where a particular matter is within Commonwealth power, it is also within Commonwealth power to cover the field and to override remedies which would otherwise be available under the general law - Airlines of New South Wales Pty Ltd v New South Wales [No 2] [1965] HCA 3; 113 CLR 54, at page 80, Chief Justice Barwick.

If the Act had not included in the immunity of section 164 the boycott conduct permitted by the Commonwealth, for example, peaceful picketing, it then would not have covered the field. So, in our submission, this is just merely an aspect of the Commonwealth making clear that it is covering the field to provide the remedies in respect of boycott conduct. I will later in our submissions refer to some of the limitations in respect of each of these restrictions of actions and details, immunity from action.

But turning briefly to restrictions on actions in tort, section 166A, dealt with at page 26 of our submission. This section only applies to actions in contemplation of furtherance of claims that are the subject of industrial dispute. We submit the restriction is incidental to the exercise of the conciliation power; it is limited. Section 166A(6)(c) does limit the matter of power and that is a matter which we submit was overlooked by my learned friend, Mr Graham, when he was referring to restriction on action in tort as if it is unlimited. That is on page 31,854. In effect, it may be limited to a period of 72 hours when the Commission must make an order to cease the period. So that the Commission must give a certificate to permit civil proceedings under subsection (6)(c) if the Commission has not stopped the conduct by the end of 72 hours after notice is given under subsection (3) in respect of that conduct.

We submit that this is a very limited restriction and for the purpose of the process of conciliation and arbitration. It is, perhaps, not all that dissimilar to the old cooling off periods which used to exist. So that when one looks at restriction on actions in tort and the other immunities of civil proceedings, one sees a similar thread of a limited protection for limited purposes for a limited time. Referring to section 166 bans clauses, we deal with that on pages 25 and 26 of our submissions, paragraph 2.50 and 2.51. Of course, the validity of the insertion of bans clauses have been upheld by this Court: Seamen's Union of Australasia v Commonwealth Steamship Owners' Association [1936] HCA 8; (1936) 54 CLR 626, and we cite other cases on page 22 of our submission.

Such clauses again ensure the effectiveness of a settlement of an industrial dispute previously reached. Parliament can specify the circumstances in which a remedy is available for breaches of bans clauses and may cover the field, in our submission, by providing what remedies are to be available for a breach of a bans clause. The Act itself provides its own remedies for breach of a bans clause, the penalties for breach of an award. Section 178 provides for this. The bans clause is a clause in an award. We note also that sections 181 to 185 provide for settlement attempts before actions for breach of bans clauses are commenced.

Dealing with section 343A, the matter of employees not to be dismissed for engaging in industrial action, that is dealt with on pages 26 and 27, paragraphs 2.54 to 2.55 of our submissions. Where a dispute has been notified to the Commission or the Commission has found it to exist, an employee is not to be dismissed or prejudice his employment because he is engaged in or proposing to engage in industrial action. We submit Parliament is entitled to conclude that such a protection of employees is most likely to lead to settlement of the dispute and to prevent the settlement being impaired. Justice Gibbs in Reg v Bowen, which I have already referred to, 144 CLR at page 462, said in particular:

it was competent -

and he was dealing here with section 188 which dealt with dismissing an employee because he refused to join in industrial action, said:

for the legislature to enact the provisions of s 188 in conjunction with par(a) of the definition of industrial action "as a means of preventing officials of an organization contributing to the indirect impairment of the settlement made of the dispute".

Justice Wilson similarly at pages 486 and 487 and, alternatively, as we submitted before, as Bowen confirms, Parliament has wide powers over organisations and can provide for protection of members of those organisations. So, to summarise our position on the immunity provisions, we say that the sections providing immunity from actions under State law fall into four categories, but each has to be considered separately because each has a different purpose. The 72-hour restriction is one category - that is boycott conduct; section 163D(3)(b) for 72 hours. That requires the certificate of the Commission. Actions in tort, exceptions of personal injury, damage to property, unlawful dealing in property et cetera. Once more under 160A(6)(c) the restrictions of 72-hour period.

So these give a limited opportunity for the purpose of the exercise of power of conciliation to settle the dispute before action may commence under State law. Bargaining immunity periods, section 170PM: that immunity period only exists in limited circumstances set out in section 170PC. During the period industrial action is protected. This enables again the parties' attempts to reach agreement to proceed. The immunity does not apply unless negotiation precedes industrial action, section 170PI, unless the industrial action is authorised, section 170PK, unless application to certify an agreement is made within 21 days of the agreement being made, section 170PL, and the Commission is entitled and empowered to terminate a bargaining period of the negotiating party that has organised industrial action that is not genuinely trying to reach an agreement or has failed to comply with a direction or if the industrial action is causing significant harm, section 170PO.

The third immunity is covering the field immunity. That is the Airline of New South Wales point. That is reported in [1965] HCA 3; 113 CLR 54, particularly at page 80. The Act provides remedies for boycott conduct under section 163G, 163H and ban clauses, section 178, provide a penalty for breaches. These remedies are intended to cover the field in respect of boycott conduct. Section 164, therefore, we submit, is within power, bans clauses similarly. Section 334A, which we just referred to, is one of a number of provisions, many of long standing, in Part XI of the Act which make it an offence to dismiss employees for various reasons. This section makes it an offence to dismiss employees for engaging in industrial action where an industrial dispute has been notified to the Commission or the Commission has found it to exist. It was open to Parliament, we submit, to conclude that when an industrial dispute existed dismissing employees would be liable to exacerbate the dispute. So the section can be supported for the reasoning advanced in Bowen's Case or Boot Trade Case.

Now, if I may turn briefly to section 150A(2)(b) and section 170MD(5) dealing with reviewing awards or refusing to certify agreements if they contain discriminatory provisions. It is dealt with in our submissions pages 27 to 29, paragraphs 2.56 to 2.63. Parliament is, we submit, entitled to specify matters which are not to be included in awards or certified agreements where those matters, for example, discriminatory practices, are likely to induce industrial disputes. We submit it is incidental to the exercise of the conciliation and arbitration power to provide a mechanism for the maintenance of a settlement of industrial dispute and to permit the Commission to review awards for that purpose. We refer to R v Kelly; Ex parte Australian Railways Union [1953] HCA 96; (1953) 89 CLR 461, particularly Justice Taylor at 473 and Justice Dixon at 481, 482. The Commission can include, we submit, in an award whenever it considers it necessary or expedient for the purpose of preventing or settling dispute or preventing further industrial disputes matters of this sort. We refer further to our submissions in paragraph 2.63.

Dealing with the additional effect provisions of Division 1 and Division 2 of Part VIA, that is dealt with in paragraphs 2.64 to 2.66 of our submissions. These divisions provide that the Commission may make an order under the division to prevent an industrial dispute about minimum wages for employees or about equal remuneration for work of equal value and we submit that the separate operation of the division beyond the external affairs power is supported by the conciliation and arbitration power. Minimum wages and equal remuneration are obviously often the subject of industrial dispute. Indeed, we do not understand South Australia's submissions as saying that the additional operation is beyond power.

Turning next to Part 3 of our submissions, the external affairs, and I introduce it by subject matter. The issue of reopening the Tasmanian Dam's Case is dealt with in some detail in our submissions, paragraph 3.6 to 3.16, after we first identify the particular provisions which the Commonwealth would desire to support under the external affairs power. In summary, we say there is no reason to justify reopening the decision. There is no relevant grounds. The decision certainly was not given per incuriam. It is not inconsistent with earlier cases. It was given over a decade ago. Its correctness has been subsequently affirmed and has been acted on, and we feel that we can let the submissions speak for themselves on those points.

We would note that in 1984 soon after the decision in the Tasmanian Dams Case, Professor Sawer writing in - this reference is not on our materials but I could read a paragraph of it - 14 Federal Law Review at 199 under the external affairs power said:

It is a tenable view of Commonwealth v Tasmania that as a matter of ratio decidendi it adds nothing to the judicial construction of the Commonwealth's external affairs powers and which was not alaready adumbrated in R v Burgess; ex parte Henry and clearly established in Koowarta v Bjelke-Petersen.

Well, looking at it some 11 years later, we would submit that that remark was probably a fresh but nonetheless correct assessment of the situation. We submit that, as we have in our submissions, it is sufficient to find here the international treaty, and as long as there is no assertion that it is not bona fide, the inquiry becomes whether the laws here are reasonably appropriate and adapted to implementation. No additional element of international concern is - - -

DAWSON J: But that cannot be the sole test, can it?

MR GRIFFITH: Well, your Honour, I am doing this shortly and quickly, so yes, I agree, your Honour, but I do not wish to engage the written submissions unless your Honour would desire it, so, can I agree with what your Honour was just going to say?

DAWSON J: And get on to the interesting bit.

MR GRIFFITH: Yes, your Honour, if I may be permitted. I hope it has been interesting. Well, there is an interesting bit, your Honour. Your Honour, one interesting bit about this question of there is really nothing new here is, if I may be permitted to refer to a person who was my predecessor in office, but at a time writing as Professor of Public Law in the University of Melbourne, International Labour Review of 1946. He discussed the issue of whether or not external affairs power would support enactment at international labour conventions, of course at a time when the process had not really advanced far past Henry. It is quite interesting seeing the extent to which, perhaps we would say it far more cautious than we know now with the developments of these things, Professor Bailey was able to engage in a discussion of the salient issues of inquiry, and without accepting the certainty of enactment with the positive terms of our submissions, your Honour, at least flag this matter as something for future inquiry. It has taken almost 50 years to do the step, but it is put, your Honour, as a step on the road, as it were, for interest. I will not take the Court to the article.

Of course, the ILO has a peculiar and creditable history that goes back to the Treaty of Versailles, at tab 29 in volume 2 of our materials, and we refer also to our discussion at paragraph 3.11 of our submissions, but we say that there is no basis in terms of subject matter than distinguish between labour relations which is an aspect of human rights and other human rights. Slavery, forced labour, one of the ILO's earliest concerns, and see also we would like to refer to Article 7 of the covenant on economic, social and cultural rights which appears as Schedule 8 to this Act, CCH page 35,352, which recognises the right of everyone to enjoyment of just and favourable conditions at work. Perhaps that is an elegant way of describing the basic target of the ILO conventions.

Indeed, my learned friend, I think, three times made reference to the ILO convention on rights of indigenous people which, of course, is not a convention which Australia has acceded to, but we would submit that that was really a matter raised for the purpose of prejudice, more or less to say rhetorically, "How could the ILO be interested in indigenous people as a matter of truly international concern?" Well, our answer - we will not take the Court to the terms of that convention - "Why not? That is the very sort of issue one might expect there to be international concern from a body which has, unusual of international bodies, won the Nobel Peace Prize.

So that, in our submission, there is a glorious history to the International Labour Organisation such that almost no other international body has. My learned friends seemed to make some point that, "Well, it might be all right to have a convention from the General Assembly". Well, basically, the General Assembly, United Nations, does not adopt conventions. Sometimes it sanctions them, sometimes it recommends them. It is not commonly realised that, say, the Human Rights Committee is not a committee of the United Nations. It is a committee set under an entirely separate treaty which, although it is under the aegis of the United Nations, in fact, is a body operating under the sanctions of the terms of the particular treaty under which it is created.

The status of ILO conventions are peculiar because my learned friend referred to the fact that the conference of the organisation comprised of an unusually broad representation - it is not just governmental representations - two government, one worker, one employer. In our materials we refer in detail to these provisions. Also, the terms of the constitution of the ILO are unusual in that for the most part, conventions are negotiated by bilateral - and conventions, I suppose, in some cases - but multilateral conferences and adopted, and the usual structure, if one has for example, what we will describe the process of UNCITRAL, United Nations International Trade Law Organisation, it might spend upwards of 17 years negotiating and finalising the terms of the convention, which then may be disposed of to a diplomatic conference for the purpose of settling its final terms. If that is done, one would expect the United Nations to pass a resolution recommending to parties that they adopt the convention. Then, perhaps, years can go past. We have since 1982, in the case of the Law of the Sea Convention, before it comes into force by having the sufficient number of ratifications.

The ILO constitution is unusual because there are time limits fixed under the Constitution whereby State parties to the ILO, and there are some 170 of them which is close to universal, are required to consider within a limited time framework whether or not they will ratify the treaty, and are required in any event to report both as to aspects of treaties and also aspects of consideration and implementation of recommendations. So that although it is clear the convention is only binding upon members which ratify the conventions, that is clear enough - convention is just another word for treaty - the ILO constitution is unusual in that it has an aspect of covenanted continued review and reporting with respect to the attitude and processes of States and consideration of accession and implementation of their terms.

My learned friend, Mr Graham, indicated in the transcript at page 46 that the conventions, in their text, indicate it is usual the number of adherents required for the treaty to come into force, you cannot have only one person a party to an operating treaty as I would understand it, but it is usual in ILO conventions to require two or more States for it to come into force. That number is not unusually low. UNIDROIT conventions the usual number is three. The fact of the matter is that the number of accessions to ILO conventions is really exceptionally - one must use a superlative - it is the largest of any group of conventions on subject matter which exist. For example, going back to the issues of trade law, the UNCITRAL Hamburg Rules Convention came into force with 20 accessions. The Vienna Sales Convention required the same number. It is regarded as exception that the New York Convention on Recognition and Enforcement of Arbitral Awards has some hundred member. Many operating conventions have 20 members or less.

When one looks to the statistics which one finds in tab 2 volume 2 of our materials - and I should indicate to the Court that the first page of that extract dealing with the freedom of association and protection of right to organise convention was unfortunately omitted. It has been furnished to the Court but it has not caught up with your Honours' volumes. There is a first page which goes immediately before page 113 appearing. Has the Court the additional page? Your Honour does not, so I will hand it up.

One can see that under "Freedom of Association and Protection of the Right to Organise a Convention" with 113 in the bottom of corner it says 109 ratifications. In fact, there is obviously not 109 States there, so this is the missing first page for that. Just leafing through these conventions, one sees - and I will just mentions numbers as your Honours turn over. The first convention 112, the next 123.

DAWSON J: Is this meant to show international concern?

MR GRIFFITH: It is meant to be extraordinary international concern, your Honour, at the highest level, yes: 120 for equal remuneration; 118, discrimination employment occupation conventions; 38 minimum wages, and one gets to the more recent conventions and 1980 is recent for a convention; 20 for family responsibilities and 20 for termination of employment convention. That shows, we submit, the highest level of international concern and support. Now, just a minor point, my learned friend in his hand-up submission yesterday morning on legal principles for external affairs referred to section B paragraph 9, I am sorry there are not page references, to the "limited effect of ratification Article 19 paragraphs 5(d) and 8".

As we understand it, what was intended there is the limited effect of adoption under the provision of Article 19, but this is not a particular point other than descriptive of the process. One has adoption of a convention. Of course, it does not bind anyone when it is adopted, but only by the States when they accede to it. Quite often at a diplomatic conference some States will sign the convention when it is adopted but that does not have any legal significance. What is significant is either the ratification of the signature if you sign when it is adopted or since the ILO convention - it is a process to adopt conventions by resolution rather than having signatures of ratification.

In that situation it remains the ratification process, the notification of a State that it accepts the obligation of the convention and, of course, that is not the matter that Article 19 is referring to.

The difficulty in respect of Victoria's submission to reopen Tasmanian Dam is that, we submit, notwithstanding this further document which was produced, it is not able to propose where it wishes to reopen to. Perhaps to put the matter, I hope not too brutally, unless one embraces, we submit, a purist principle on a "the slate is wiped clean" approach we have a choice. Perhaps the same sort of situation one might have on excise or one can mention section 92, let us say excise. One could postulate possibly - I am not too sure about excise - but it may be one can postulate - my learned friend the former Solicitor-General for South Australia certainly did - a view as to excise and say this is the correct view as to excise.

We would accept that during the course of exchanges from the Bench the day before yesterday, one saw a postulation of what could be a meaning of external affairs and perhaps putting it a bit more freely than it could be expressed, saying that external affairs is limited to matters external to Australia and dealing with matters of direct and almost physical external relationships; some concept of that sort.

DAWSON J: But it is a problem which starts really before that. You really have to look to the words of the Constitution, do you not? Its power is a power to make laws with respect to external affairs. That necessitates you in the first place of identifying the affairs with which the legislation with which we are concerned deals. Can you identify the affairs with which that legislation deals?

MR GRIFFITH: This is a subject matter approach, your Honour.

DAWSON J: I use the word "affairs" because that is the word the Constitution uses.

MR GRIFFITH: Your Honour, my submission was really to say one can accept that that could be an approach absent authority.

DAWSON J: It is the only approach initially, is it not, because we are dealing with the Constitution. What do you say are the affairs with which the legislation in question deals?

MR GRIFFITH: Here?

DAWSON J: Here.

MR GRIFFITH: Your Honour, we say that it is the affairs covered by the conventions and that is sufficient on the authority of this Court.

DAWSON J: What are those affairs? That is only by reference to something else. How would you characterise it?

MR GRIFFITH: We characterise those matters of international concern.

DAWSON J: No, it is labour relations, is it not?

MR GRIFFITH: Yes, your Honour.

DAWSON J: That is the first thing, so you are dealing with legislation which deals with labour relations, with respect to labour relations. Your next question is: where is the externality in all of that?

MR GRIFFITH: Your Honour, we say that there are many sources of it, but here it is sufficient to say that there are the various conventions, both the ILO ones and other conventions.

DAWSON J: That does not answer the question, because what you are saying there is the motive for the legislation which deals with these affairs is the implementation of conventions.

MR GRIFFITH: Which is a matter of external relationship.

DAWSON J: I do not know that a motive can. You have got to find the external relationship somewhere.

MR GRIFFITH: We say the treaty itself is a matter of external affairs, your Honour.

DAWSON J: There is no doubt about that, but the law is not a law with respect to treaties, nor is it a law with respect to international labour organisation conventions. It is a law with respect to labour relations.

MR GRIFFITH: Your Honour, what I wish to say in opening this up is that that approach may be put, but our submission is that it is not one which may presently be put as having the authority of this Court.

DAWSON J: Why?

MR GRIFFITH: Because the Court has determined otherwise, your Honour.

DAWSON J: But what one has is a situation where the Court was equally divided in Koowarta, and then you have Justice Stephen's judgment which speaks in terms of international concern. He, one would suspect, intended that to be something which would curb the ambit of the external affairs power. It has been used in subsequent judgments one way or another to expand it.

MR GRIFFITH: He may or may not have intended - when one reads the entire passage of Justice Stephen, it seems that he did contemplate that it could be very broad indeed.

DAWSON J: Or that it could rein in situations which would otherwise fall within the ambit of the power; in other words, that some treaties do not deal with matters which are of international concern. It is a separate consideration.

MR GRIFFITH: Your Honour, there may be such treaties, but we have not found many yet, in our submission. But perhaps.....getting in the colourable qualifications which everyone accepts but never sees.

DAWSON J: No, because your proposition is that whenever there is a treaty that is evidence of international concern. That is not the approach, I think, that Justice Stephen adopted. But what I am saying here is that the submissions, as I understood them, were not so much to reopen the Dam Case as to point to the difficulties inherent in the various tests which are posited there and which are not, to some extent, consistent with one another.

MR GRIFFITH: Your Honour, I was intending to say that unless my learned friend the Solicitor-General for Victoria embraces the sort of approach that your Honour has made clear in your judgments and in the exchanges, our submission is that really it is not possible to articulate a basis of distinction tenably, and we say in particular, not along the lines adopted by my learned friend, either in his first written submissions, his second written submissions or, for that matter, in his oral reply or in his hand-up version, because, your Honour, we feel it is not necessary to analyse the internal inconsistencies of what we would say my learned friend's submissions are. On one view my learned friend submitted he was doing very little; he was not attacking the result of any decision, even Tasmanian Dam, he specifically was not attacking the result of any case, he particularly was not attacking any law as listed in our paragraph 3.36.

DAWSON J: That is understandable because one can see an international aspect in each of the decided cases, because race relations concerns other races elsewhere, world heritage concerns matters which are the property of humankind. But when you get to a matter like this you are faced with a different problem, because you have got a law with respect to labour relations in this country. And what you have got to show is that there is, on one view, some external aspect. That is what is meant by international concern and it is very difficult.

MR GRIFFITH: Well, your Honour, we submit that really this is a higher level dealing with, in effect, the human and economic rights of workers than dealing with the international rights of mountains and rivers.

DAWSON J: Well, it may be.

MR GRIFFITH: My learned friend's submissions seem to be a geomorphological or inanimate external affairs test. If it was protecting something physical within Australia, it was all right; if it was something which dealt with issues which are spiritual or human rights or economic, it is not. What we wish to submit, your Honour, is that there is no basis upon which my learned friend can make the sort of distinctions that he does and accept, for example, that the Race Relations Act is within power and not accept the enactment of these basic provisions in respect of a minimum right of economic equality, as it were, in respect of the rights of employees.

McHUGH J: Well, I notice in the article you handed up by Professor Bailey that he argued that the maintenance of international peace and security is dependent upon the nations promoting and improving labour conditions, standards of living and so on, and it all goes to secure the - - -

MR GRIFFITH: Yes, we have not taken the Court in detail to the history of the International Labour Organisation. We refer to its glorious history, we say, starting with the Treaty of Versailles, being taken through the League of Nations, being the first international organisation of the United Nations, and, we submit, directly dealing with those matters. It is interesting that Sir Kenneth Bailey as early as 1936, was it, was able to - - -

McHUGH J: In the 40s I think.

MR GRIFFITH: Sorry, 1946, when this process post-war was just commencing was able to express in such strong terms at a time, of course, when the whole issue of human rights and the Universal Declaration of Human Rights was still fresh in his mind particularly - he helped draw it - but in everyone's mind.

McHUGH J: But historically the words "and treaties" were going to be included along with the phrase "external affairs" and that was deleted. Was it actually in the convention? Was it in the draft Bill?

MR GRIFFITH: I will have to confirm that, your Honour. I am not sure. Of course that broadens it.

McHUGH J: The reason the treaty-making power was taken out of the Australian Constitution, as opposed to the situation in Canada and the United States, was because it was perceived in 1900 that it was the King only who could make treaties, but now because of the evolution of the status of the dominions, the Governor-General or at any rate the country makes treaties pursuant to the executive power under section 61. Can you rely on section 61 and section 51(xxix) to support legislation implementing treaties?

MR GRIFFITH: If that is necessary, your Honour is postulating. We submit that the external affairs power in itself is sufficient, your Honour.

McHUGH J: I appreciate that.

MR GRIFFITH: But, of course, it is the executive that make treaties and they may lawfully do that under section 61, but perhaps I could pick up your Honour's remarks yesterday, "This is the result and I don't like it," if I could summarise it like that, your Honour. That remark can be made in a particular context, but much as one must say, yes, you might not have been able to predict this in 1900 as part of the emancipation of Australia as an independent State that matters would develop, that international relations would develop - - -

GUMMOW J: The whole area of debate is an illustration of the shortcomings that are involved in looking just at the intentions of the founding fathers in 1900. One of their intentions probably was that they were creating something, the like of which they could not foresee.

MR GRIFFITH: Yes, your Honour. I mean, the narrowest view that it was for the purpose of a customs union and defence, the cost of the dog licence, the provision providing for return of three-quarters of the revenue.

McHUGH J: They could not foresee what effect the defence power would have in time of war and in the same way they have not been able to foresee the effect that the external affairs power might have in time of peace.

MR GRIFFITH: And they might not foresee that you could not prohibit political advertising during an election, your Honour. There are a lot of things.

BRENNAN CJ: We are not really developing new ideas, are we?

DAWSON J: But you are brought back to the discipline which the Constitution does require of interpreting the words "external affairs" and as I understand the submission that you are putting, is that those words are the equivalent of either the implementation of treaties, to make laws in respect of the implementation of treaties or the equivalent of international relations, to make laws with respect of international relations.

MR GRIFFITH: Yes, and once one admits that that principle has been determined, your Honour's view of the treaty is not so important as the concern - - -

DAWSON J: But one finds that very hard to do when one looks at the words, because, as you concede, the affairs with which this legislation deals is labour relations and one has to then find the other requirement, externality, somewhere.

MR GRIFFITH: The problem is, your Honour, we do not know exactly where we are on the argument because I did notice my learned friend seeking permission to reopen, in a fundamental way, external affairs to wipe the slate. In fact, my perception of his submissions were entirely the opposite, saying that he did not want to alter the result of anything, not even Tasmanian Dam, he just wanted to alter something within Tasmanian Dam's reasoning which would let him win this case.

DAWSON J: It is a problem which has to be faced sitting on this side of the bar table and one cannot be confined in one's consideration of it by the enthusiasms or lack of enthusiasms of those who are on the other side.

MR GRIFFITH: Of course, your Honour, but our submissions are - and I will not repeat them from the submissions - that this is a case where the Court should not grant leave if it has been notionally asked, for no other reason there are only six of your Honours here.

DAWSON J: Well then, how do you determine international concern and what degree of international concern is necessary?

MR GRIFFITH: Your Honour, in a way one can say that what Justice Stephen said in Koowarta does express it sufficiently for the purposes of being able, certainly, to resolve each of the issues relied upon - - -

DAWSON J: But, he talked in terms of such fundamental issues as genocide and so on. Now, labour relations are not within that category.

MR GRIFFITH: Your Honour, we submit that, just looking at the precise words he uses and looking in regard to the history of the ILO, the way the convention approves the topic, the subject-matter, all the decisions of this Court, the various Acts which have been listed which have been held valid, those which have not been challenged but my learned friends concede, it begets on that authority, in our submission, only one answer. Here, indeed, we say that for all this legislation we rely upon the treaties themselves, the various treaties; we do not need to rely on the separate argument of international concern although, if necessary, support is also there.

Your Honour, we have attempted to spell it all out in our submissions and with reference to the displacement of materials to do just that, but within the authority of the decisions of the Court as we read them and as we postulate them to date. If my learned friend is now regarded as having asked leave to reopen all this, for the reasons we have stated, we oppose it. If the Court is minded to take itself down the track to do what, say, it did not do in the Philip Morris Case and look at all this, we rely upon those same submissions as a whole to say that what was done before is correct and this is the result and that these laws are valid as supported by the power - - -

DAWSON J: The difficulty with that is that it ignores the problems which this case throws up. Because, when you take, for instance, section 51(xxxv) which was obviously meant to limit the power of the Commonwealth to deal with such matters as conciliation and arbitration for the settlement of industrial disputes, you cut across that limitation and obliterate, as it were, that section from the Constitution. Or to take section 51(xxxi) which is raised in this case, just terms. You enable the Commonwealth to disregard something which was obviously meant to be a fetter on its powers.

MR GRIFFITH: Your Honour, just terms is not so easy to disregard. I will deal with just terms, your Honour.

DAWSON J: But, the point is that you allow one paragraph to cut right across the rest of 51 and this demonstrates it because it really makes the provisions of section 51(xxxv) irrelevant.

MR GRIFFITH: Your Honour, we submit not so, but the corporations power has always enabled laws to be passed validly which operate in an area which could be within - - -

DAWSON J: Maybe, but it has its own limitations.

McHUGH J: What about the limitations on bounties and banking and State insurance; can you bypass those by the use of the external affairs power?

MR GRIFFITH: Your Honour, one would regard that as unlikely. I do not know whether we are going to have an application for leave to reopen Engineers as well, because one gets involved in these issues of approach to powers. Jumbunna indicated a mechanism approach to the various powers which the Commonwealth continues to support.

DAWSON J: Engineers has got really nothing to do with it because that was a matter of interpreting Commonwealth powers by reference to the residue of powers left to the State, but here you are concerned with the inconsistency, on the view that might be taken of the external affairs power, of one Commonwealth power with another Commonwealth power.

MR GRIFFITH: If your Honour is postulating that one is at this stage of authority of the Court able, without overruling early authority of the Court, as it were, wiping the slate and starting again, that the external affairs power should be read down so as to protect the conciliation and arbitration power, we submit - - -

DAWSON J: The conciliation and arbitration power imposes by its very terms a limitation on the external affairs power - a possibility. Certainly section 51(xxxi) might operate that way.

MR GRIFFITH: Your Honour, we submit that that is denied by decisions of this Court, reasoning of its Judges, and we refer to that in our materials and we rely upon it.

BRENNAN CJ: Mr Solicitor, you have given us the benefit of your written submissions. Those are the arguments you wish to advance. Are there any further concepts outside those that you wish to develop any further in relation to the external affairs power?

MR GRIFFITH: Your Honour, what we wish to say is that there has not been advanced, in our submission, any alternative expression of the reach of the external affairs power which the Court is even in a position to be able to consider to adopt as a substitute for that which we submit is the established position. I referred to the four opportunities, particularly Victoria has had, to advance that and is going to have another reply to perhaps advance another, and we say none of the four versions so far, including the written one, does give a basis upon which the Court could embrace a more limited operation which would result in a characterisation of any of the relevant treaties and conventions here referred to being categorised as treaties which could not support the exercise of external affairs power in this area has been enacted.

GUMMOW J: Mr Solicitor, could I make a fairly modest request. In Burgess 55 CLR 682, in addition to the reference to the article by Professor Bailey, there is reference to an article by Professor Starke - he must have been a youngster - in 1935 called Australia and the Constitution of the ILO. Would it be possible to be supplied with a copy of that?

MR GRIFFITH: Of course, your Honour.

GUMMOW J: I think it may be a fairly obscure journal. That is why I asked.

MR GRIFFITH: Perhaps not today but we would seek to have it by tomorrow, your Honour. Your Honours, just to draw it together, we say it is just not open to characterise any of these treaties as not being directed to the subject matter of these conventions and we do - if we are permitted to pick up what your Honour Justice McHugh said at page 45 of the transcript:

The logic of the majority in Tasmanian Dam seems to me to be very difficult to subvert -

unless, of course, one cleans a slate of 60 years and we say that that would be the process involved for the Court to engage in this and we do submit that the Court as presently constituted is not in a position to do that and we deny that my learned friend's submissions have given it a firm base on its submissions, whether it is necessary to obtain leave or not, for the Court to advance in that area. Your Honour, perhaps it is a rhetorical way of putting it but in political advertising it was possible for Sir Maurice Byers to address the Court and throw the issues up, as it were, in my learned friend Mr Gageler's submissions, and leave it for the Court, but our submission is to put it, if it is not putting it too strongly, that that is not the position with external affairs. We are not dealing with an open issue where for the first time we find the result. We found the result and our submission is that is determinative here but we add a note, an alternative is not yet offered. If I could leave entirely aside your Honour Justice Dawson's view, which I do understand and which I could understand if my learned friend, Mr Graham, submitted a meaning along those lines, but he has not done that.

DAWSON J: He has not.

MR GRIFFITH: He has not. He has not four times, your Honour. So, your Honours, there are many other detailed points I could make on this issue, but I will move on. Your Honour Justice McHugh referred to what might have been referred to as the federal clause at transcript 15 and 16 in these conventions and Article 19, 7 of the ILO constitution, it appears in volume 2, tab 30 of our material, has a clause. It is not actually a federal clause because usually under federal clause means that the State on accession is able to say that it does not have power in a particular area and qualifies in that reason its accession.

Now, it is the custom of Australia not to sign with a federal clause at that point. In fact, conventions nowadays tend not to have them and it is more a process that Australia in many cases enacts, in co-operation with the States and the Commonwealth, complementary legislation, or even State legislation without a Commonwealth Act if not required, which brings into force throughout Australia the convention obligation and then Australia accedes to the convention and so that, for example, happened in the case of the adoption of the Vienna Sales Convention, the international sale of goods. There is an awful lot of co-operative federalism which goes on out there.

In the case of even the model law for international arbitration, although each State had passed recent and up-to-date arbitration laws, each was prepared to contemplate passing its own amending law to introduce the UNCITRAL or model law of international arbitration, on just the bare terms of the model law, although in the end the Commonwealth Act was able to do that conveniently by adopting it as a schedule.

Now Article 19, 7 is different because it, in effect, gives a choice of saying you can do it this way or do it that way; it is not saying, we adopt this convention flagging that we cannot do it that way, we have to do it this way. Now your Honour Justice Dawson, I can see obvious point which may be put to say, "Well, can you rely on a clause in those terms that do express a choice" - I am not seeking to look into your Honour's mind, but it is an obvious inquiry - "to increase the power further?". Now what we say about that is, "Yes", and what we say is that, in effect, that was determined also in the Tasmanian Dam Case, because there one had Article 34A of the world heritage convention, and one sees this on the headnote of 158 CLR 1. There the Court determined that the fact that there Article 34A appeared, that did not mean that there was no obligation on the Commonwealth to implement the provisions of the convention, and if I may give page references: Justice Mason, page 136; Justice Murphy, page 178; Justice Brennan, page 228; Justice Deane, page 263; your Honour Justice Dawson, page 313 contrary; Justice Wilson, page 195 and Chief Justice not deciding.

So we submit that with Article 19, 7, it leaves it to this government, the Commonwealth Government, to decide which conventions and recommendations it regards as appropriate under its constitutional system for federal action, in whole or in part, or for action by States, and we say if we decide to implement by federal legislation, well then we have the same obligation as a non-federal State to respond in adopting the convention. So if we decide it is appropriate to have State action, well then our obligations are set out under Article 19, 7(b).

But once a convention is ratified, Article 19, 7 does not qualify in any way the obligations assumed by a federal State. So, it is not equivalent to a federal clause where you sign saying, "We sign but we do not say we have power to enact some parts of it because of the fact that we are a federal State". As I mentioned, such federal clauses have tended of late to have gone out of international favour.

Of course, in the connection with these treaties, the course of, say, adopted for the Vienna Sales Convention, of putting the legislation in place first and then ratifying the treaty, cannot be taken because it is the accession to the treaty by ratification which, under external affairs, supports the power, we would submit, to enact the law, so it had to be done that way around.

Referring to the issue of reasonably appropriate and adapted, and particularly the remarks of my learned friend, Mr Graham, at pages 55 to 56 of the transcript, the Commonwealth, in its submissions at paragraph 3.69 is not suggesting that the Court is bound in any formal sense by the International Court of Justice which has, I think only on two occasions, or the predecessor, has been asked for advisory opinions, or the International Law Labour Organisation.

The High Court did recognise in Queensland v Commonwealth [1989] HCA 36; 167 CLR 232, particularly at 239 to 240, that the existence of an international duty does depend on the construction which the international community would attribute to the convention. We do not take this at all to the point of saying therefore participation by this Court is excluded. We do submit that it is a matter where, certainly, regard - strong regard - is to be held by the Court, merely as a matter of international comity, but reserving of course to this Court the power to decide the constitutional issue, but at the same time exercising substantial deference to anything that has emerged as the matter of international opinion and practice.

Of course, in international law, opinion and practice following a treaty can have as much effect as the treaty itself, as exposition of what the international law on the point is. For example, that has happened with the convention on the law of the sea to the extent that even France ratifying that convention or signing it without ratifying it - I think signing it without ratifying it - said that it admitted some terms of that convention constituted an accurate statement of customer international law, although I do not think France has yet acceded to that treaty, but that is the processes which occur.

We submit that when one sees that it is perhaps theoretically possible for this Court to adopt a contrary view but extremely unlikely and against the principles enunciated by this Court in dealing with the issues of international comity, particularly in aligning matters of domestic law with recognised principles of international law. Nothing much turns on that but, in our submission, the ILO convention's operations are particularly pertinent to this sort of development because it is really the one international organisation that has, if I may put it, after sales service in a way that really exists in other multi-lateral operations. It exists with the Human Rights Committee.

To have an annual session of full participation, not just the committee of 24 persons but the full organisation of the ILO reviewing, accepting reports, committee of experts, et cetera, is particularly relevant when one is seeking what is the content of the obligation. That is a matter my learned friend, Mr Burmester, will refer to dealing with the issue of right to strike.

Your Honour the Chief Justice raised at the transcript page 57, and I think 62, the question of whether the Commonwealth can create a subordinate body to implement a treaty. We say that what we are here doing is really supporting an obligation which is fixed by the convention itself, and what we are doing is imposing a statutory requirement on the Commission to act in accordance with particular treaty obligations when exercising powers conferred upon it. So in the case of minimum wages, this is clear when one compares the sections of the Act with the relevant articles, and we refer to this in paragraph 3.24 of our submissions.

BRENNAN CJ: Is that an accurate description of it? I mean, it is not a question of simply saying to the Commission, "You have powers. Exercise them in accordance with the treaty". It is a matter of saying, "You shall have the powers which we now give you by reason of the treaty and exercise them in accordance with the treaty".

MR GRIFFITH: Your Honour, the treaty is a means of enactment. One could express the powers by direct reference to those in the treaty. Now, your Honour, that is because of differences in felicity and language et cetera. It is not always appropriate. I mean, that is the mechanism adopted for the model law of international arbitration. It is just included as a schedule and the terms of the model law operate as Australian law without any extra definitions but, in this case, your Honour, our submission is that is what is done through the adoption of the provisions of the Act, reflecting faithfully, we submit, the requirement that they replicate the treaty, and the treaty obligation is to set up machinery. It is not an obligation by legislative Act to create minimum wages.

If I could take the Court to page 35,154, Article 4 of the minimum wages convention provides at the top of the page:

Each Member which ratifies this Convention shall create and/or maintain machinery adapted to national conditions and requirements whereby minimum wages for groups of wage earners covered.....can be fixed -

Then it provides for provisions that shall be made in paragraphs 2 and 3. There are similar provisions in the equal remuneration convention. Schedule 6, Article 2 contemplates States may use established procedure for a wage determination or a combination of machinery. So that we submit that this mechanism, apart from being perhaps the only practical way of providing for a mechanism for minimum wage fixing as is required by the convention, is that which is obligated by the convention itself but tied to, we say, the terms of the convention obligation. It does not go beyond it. But of course the imprecision of language - and I was going to refer to that - is something which does require a margin of appreciation in its statutory enactment. But that, we submit, is no inhibition to the capacity of Australia to discharge its obligation.

My learned friend Mr Graham made much and included as a schedule the heritage convention, saying it was in precise language, unlike these conventions. With respect, we would submit that if one goes through these various conventions, the language is far more precise than that of the broad heritage conventions, but perhaps that is an argument that is not worth pursuing. They both bear the usual stamp of general international instruments, but perhaps with more specificity in the case of the ILO conventions.

May I refer briefly to the issue of ILO conventions and recommendations. This is a matter that Mr Burmester will particularly refer to, dealing with the issues of parental leave and also strike, but our submission is that firstly, in this case, the entire legislation is justified by the conventions themselves. So that we do not seek, at least for a fall-back submission, to assert that there is, anywhere in this legislation, enactment of recommendations which cannot fairly be said to be supported by the principal convention that is referred to as supporting them.

The structure of the operations of the International Law Organisation have been briefly summarised to the Court, but may I give the Court particular references to our tabs of materials whereby there are useful summaries. I will not run through that, but particularly the extract from Creighton in tab 7, especially paragraphs 3.2 and 3.3 on pages 44 to 55 and, on this part, to paragraphs 3.11 and 3.12 of our submissions.

The constitution of the ILO is in tab 30 of volume 2 and the Philadelphia Declaration of 1944 is annexed to that constitution. The operation of committees of the ILO which produces general surveys and a committee of experts is discussed in the Department of Industrial Relations' publication in tab 1, volume 2 of our materials, pages 16, 17 and also the extract from Valticos which was also extracted in different pages by my learned friend, Mr Graham, but appearing in tab 3 of our materials, pages 240 to 243.

We note that the ILO has established a committee on freedom of association. This is picked up on page 19 of the Department of Industrial Relations' publication, tab 1 and Valticos, tab 3, pages 248 to 250. This committee has examined over 1,700 complaints and the Court will see, for example, from the extract from Creighton the description of this process. There have been 12 complaints from Australia, the most notable one being in respect of the air pilots' dispute and material on that is included in our volume 2 of materials.

The Industrial Relations document in tab 1 at page 15 describes the process of drawing up and negotiating conventions as an extensive process and this is also described by Creighton and Stewart in tab 7 at page 45 of that extract, referring to the voting processes of having three categories of delegates and requiring a two-thirds majority as meaning it is unlikely that a convention would be adopted in the face of concerted opposition from government or of employer or of employee members.

Can I perhaps just read this quote before we adjourn, your Honour?

BRENNAN CJ: Yes.

MR GRIFFITH: They say at page 45:

This sometimes means that standards which are adopted represent the "lowest common denominator" which could secure the necessary degree of cross-group support. On the other hand, it also means that those standards which are adopted have a unique authority by virtue of the fact that they have received a significant measure of acceptance with all three constituencies.

Would that be an appropriate time.

BRENNAN CJ: Yes. You are behind time I imagine, Mr Solicitor. We will adjourn until 2.00 pm.

AT 12.47 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.02 PM:

BRENNAN CJ: Mr Solicitor, before you commence your submissions this afternoon, I am grateful to have had the estimate from counsel of the time that they will take. The Court's listings are such that it would obviously be desirable for the Commonwealth's submissions in all to be finished by 11 o'clock tomorrow, with a half hour available for reply after that by Mr Young. I would be grateful if you could tailor your submissions in such a way as to conform to that timetable.

MR GRIFFITH: Yes, they are so tailored but we will keep to it as well, with plenty of time for interventions, I hope, your Honour.

Recommendations, of course, have a non-binding status. In the ILO context we submit they have a particular and peculiar role with respect to convention. There is a reference to Valticos in tab 3 page 55, 56 which I will not read to the Court; but the Commonwealth's submission, which appears from paragraph 3.60, that if legislation does give effect to an ILO recommendation which stands as guidelines on the application of a convention, then that legislation will be reasonably appropriate and adapted to giving effect to the associated convention.

My learned friend the Solicitor-General for Victoria, referred to what his Honour Justice Mason, as he was, said in Tasmanian Dam 158 CLR at pages 131 to 132. Your Honours will remember the substance of his Honour's remarks - I will not read all the statement, but indicating that:

I reject the notion that once Australia enters into a treaty Parliament may legislate with respect to the subject-matter of the treaty -

this is page 131 point 9 -

as if that subject-matter were a new and independent head of Commonwealth legislative power.

We accept that, of course. Then his Honour went on:

The law must conform to the treaty and carry its provisions into effect. The fact that the power may extend to the subject-matter of the treaty before it is made or adopted by Australia, because the subject-matter has become a matter of international concern to Australia, does not mean that Parliament may depart from the provisions of the treaty after it has been entered into by Australia and enact legislation which goes beyond the treaty or is inconsistent with it.

Of course, his Honour was there referring to the issue, as one sees it in the start of the last paragraph on page 131 - dealing with the case of the extent of Parliament's power to legislate so as to carry into effect a treaty.

Now, in this case, of course, the principal position of the Commonwealth is that all the laws under attack are supported by the conventions themselves that are referred to and that in as much as reliance is made on recommendations they only stand as guidelines or as fleshing out of the convention obligation and not creating of themselves the matter of independent obligation or international concern by reference to which the laws are sought to be supported. But these treaties, we submit, the ILO conventions in the course of ILO practice, do not operate, as it were, as codifying the extent of a matter of international concern, and that was the subject matter of his Honour Justice Mason's remarks, in our submission.

As we know, the ILO mechanisms have two arms as an integral package. There can be matters of definition of international concern and obligation by way of a convention, which does not go to codify a recommendation or necessarily codified any principle of customary international law; they exist to establish what are expressed to be obligations by way of convention, which will bind parties which adhere to that convention. They exist, for example, in the case of equal remuneration, termination, parental leave. The function of the recommendations is merely fleshing out or providing guidelines but, in our submission, the statement of his Honour Justice Mason is not apt to cover the situation where one has the parallel mechanisms of convention and guidelines; that it is not a case of saying if one has a convention on the topic of equal remuneration to which Australia exceeds, it must follow that no reference can be made to the parallel recommendation which is reviewed in.....full subject matter of the report and the like under the terms of the ILO constitution.

So for that reason we submit the statement of Justice Mason, which might be regarded as a general one, is not one which is apt to cover the issue in respect of recommendations, and were it necessary to do so, we would submit and rely upon the fact that the recommendations themselves in the circumstances they are making, may be themselves relied upon as matters of international concern, sufficient to support an exercise of the power and the external affairs power, notwithstanding that there may be a convention which has the same subject matter as part of its title or the same or similar sort of issues as part of the contents of that convention.

Now, if we could refer to paragraph 3.61 as supporting that submission but, as we say, we make it in the alternative on the terms that it is not one which is made here, but the ILO recommendations reflect the outcome of the deliberative international consideration of issues. It is not equivalent to ephemeral recommendations of some one-off international conference. They are formally recognised and carefully elaborated instruments adopted by the permanent international organisation.

States are under a binding obligation under Article 19, 6 of the constitution, which one sees at tab 30, to consider the implementation of a recommendation. Of course, perhaps I refer in passing to Justice Deane in the Dam Case 158 CLR at 261. The fact that there is an absence of precision in the language, or the fact that the conventions represent the lowest common denominator of obligation, and in some cases may be broad and general in their terms, do not affect the creation of an international obligation. At page 261 of volume 158 CLR, Justice Deane said just that in the last full paragraph, ending at point 9:

That absence of precision does not, however, mean any absence of international obligation.

In seeking to meet their obligations under the convention, States are intended to be guided by the accompanying recommendations, and we refer to this in paragraphs 3.18 to 3.25 and 3.29 to 3.33.

I next address some remarks on the issue of reasonably appropriate and adapted. This is a matter referred to in my learned friend Solicitor-General for Victoria's legal principles which he handed to the Court yesterday, section A paragraph 4(c). So, on his reformulation of the appropriate test, nonetheless he accepts the concept of inquiry as to whether matters are reasonably appropriate and adapted.

It is our submission - and I will not take the Court to the citations in support which appear sufficiently in our paragraphs of our submissions - that, firstly, the generality or imprecision of language in a treaty is not a reason why precisely detailed legislative provisions cannot be reasonably appropriate and adapted. We refer to paragraphs 3.18 to 3.20 and 3.29 to 3.31.

Secondly, we say the particular convention or provisions do provide a constraint. The Commonwealth cannot treat the subject matter of treaty as though it were a separate head of power, 3.22. We say, of course, none of the provisions which we enact have done that. We say that particularly in respect of parental leave, which Mr Burmester will deal with. Thirdly, we say partial implementation of a treaty is not a ground for saying that legislation is not reasonably appropriate and adapted. There is no requirement to give effect to the whole of the treaty, paragraph 3.62.

Fourth, we say the test is a liberal one which recognises it is for Parliament to choose the precise legislative means provided that the provisions are proportional. We refer to what your Honour the Chief Justice said with the then Chief Justice in Richardson at page 116 and also Justice Deane at pages 311 to 312 of the report of Richardson. It is necessary to examine the provisions as a whole in light of the specific convention provisions. Where a convention is general, such as minimum wages or family responsibility conventions, there is obviously more scope for Parliament to determine appropriate means than is the case of the termination convention which has more detailed provisions.

Our fifth proposition, that it is necessary to look at the particular purpose of a provision to determine if there is a degree of reasonable proportionality between the provisions and the relevant convention purpose. Of course, minds may differ as to that, and that is referred to by Justice Deane in Dams 158 CLR 266 to 267. Our submission is that here there is a deliberate and close relationship between the relevant treaty provisions and the legislative provisions to give effect to them. The States do not allege any failure of broad purpose in this regard. They only allege certain provisions and not directly related to particular obligations.

They acknowledge that the minimum pay and equal remuneration provisions reflect the terms of the convention to a substantial degree, and this is demonstrated in our submissions at paragraph 3.24 for minimum wages and 3.27 to 3.28 for equal remuneration. My learned friend Mr Burmester, as I mentioned, will deal with the issue of parental leave.

Turning then to the issue of minimum wages, which is dealt with in our submissions, paragraphs 3.17 to 3.26, I will confine myself to adopting those submissions but making one reference and that is to the submissions of my learned friend the Solicitor-General for Victoria where he relied upon, both in his oral argument and also in his supplemental submissions which he filed, Catlow v Accident Compensation Commission [1989] HCA 43; 167 CLR 543, particularly 549 and 550 as indicating that the explanatory memorandum cannot be referred to by the Court, he submitted, for the purpose of construing the issue of the validity of this or any other of the conventions.

In our submission, my learned friend is quite correct to say that section 15AB is not a section which gives authority to refer to the explanatory memorandum for that purpose. But that is beside the point in this case because the explanatory memorandum is not referred to from the point of view of a section 15AB construction issue if there was an uncertainty of meaning. Our submission is that the meaning of these sections are certain. The relevance of the explanatory materials that were before Parliament is merely that that material was put before the Court for the purposes of the processes which your Honour Justice Brennan referred to in Gerhardy v Brown [1985] HCA 11; 159 CLR 70, at page 141 where your Honour said:

When a court, in ascertaining the validity or scope of a law, considers matters of fact, it is not bound to reach its decision in the same way as it does when it tries an issue of fact between the parties.

And your Honour referred to Justice Dixon in Commonwealth Freighters v Sneddon 102 CLR at 292, with approval, when Justice Dixon said:

if a criterion of constitutional validity consists in matter of fact, the fact must be ascertained by the court as best it can, when the court is called upon to pronounce upon validity.

And, of course, the Court here is informing itself by looking at relevant writings. Each of the three plaintiffs have produced volumes of materials for the Court - well, the first two plaintiffs have; Western Australia has not, but the Commonwealth made up for that deficiency by producing its own two volumes, each of us saying our materials are more useful to the Court in considering what are the relevant background constitutional facts than the others. I suppose, together, we would agree there is a pretty comprehensive display of material from the Court going from the 19th century up to the issue of current ratifications as at today, the date of hearing.

This is all part of the process of the Court having access to whatever papers - conventions, parliamentary papers, reports, articles, official publications of the ILO, non-official publications, commentaries - to inform itself as to the situation in respect of which it has determined this matter of whether or not there is a necessary relationship. Is it my learned friend's submission that one merely has the text of the legislation itself to determine what in essence is a question of fact for the Court to determine, whether or not there is the requisite connection to a matter which may be characterised as a matter of international obligation or international concern and so to enliven the external affairs power?

So it is for that purpose that in our materials we refer to the explanatory memorandum as an assistance in making that connection for the constitutional function which the Court has an obligation, too, to engage in as best as it may be, whether the parties assist it or not. Of course, nowadays the Court does have the advantage that in cases such as this sort all parties approach the Court having done what they can to assist in that regard by making a complete display of materials and doing their best to digest them somewhat so as to not unnecessarily burden the Court.

As to equal remuneration for work of equal value, our submissions as to that in effect speak for themselves, but the only real argument against the provision seem to be the argument they were based on imprecision of language, but we say that the concepts are clear enough and on any view the provisions in Division 2 in their entirety may be regarded by this Court as reasonably adapted for the purpose of enacting the obligation which one sees spelled out in paragraphs 3.37 to 3.39 of our submissions. Beyond that we adopt the submissions which we have there. It seems common ground that these recommendations do not go in any way beyond the convention obligation. We submit if that is the case, there can be no ground for striking down on the basis of alleged absence of precision. It is easy enough to see what is the essence of the requirement and easy enough to test whether or not the scheme which is put in place is something assigned to obtain that result.

If we may turn then to the more complicated issue of termination of employment, Division 3 of Part VIA, in paragraph 3.40 of our submissions we set out a table - if I may take the Court to that without taking your Honours through it - seeking to relate each of the provisions of Division 3 to particular articles of the convention. So there, there is a particular coincidence which can be made to see a direct attempt to enact the treaty obligation. We do not discern that there is any particular dispute as to certainly the outline enactment.

There are particular disputes as to this question of whether the concept of unjustifiable termination can be embraced and also as to the issue of onus of proof. If we could deal with that issue. The three areas which we see as singled out by the States where Division 3 applies as departing significantly from the terms of the convention is, firstly, the definition of a valid reason; secondly, the references in section 170DF, particularly subsection (1)(f) and (g), page 32,021 of the CCH, which go to certain grounds on which termination is not to take place and which are not expressly set out in the convention; and thirdly, as I mentioned, the question of onus of proof, section 170EDA. The Commonwealth has responded in detail to this in paragraphs 3.43 to 3.52, but it will be useful if I just quickly summarise what is the position that we submit in relation to the material relied upon to support it.

Turning to the terms of the convention itself which appears on page 35,351, article 4 - one day I hope we can call the editors of CCH to the Bar table and ask them to explain their pagination system but, until that comes, we will just go along with it - but when one refers to Article 4 one sees at page 35,352 one has a substantial obligation in Article 4, and one has then elucidation in Article 5.

Now, in our submission, the submissions of those who attack this provision resulted from going to Article 5 and regarding that as controlling the operation of the principal obligation of Article 4. Now the principal obligation of Article 4 is:

The employment of a worker shall not be terminated unless there is a valid reason for such termination connected with the capacity or conduct of the worker or based on the operational requirements of the undertaking, establishment or service.

So that requires there to be a reason connected with capacity or conduct or operational requirements. Now the convention does not exhaustively define what is or what is not a valid reason. In Article 5 it mentions some things which amongst others are not justifiable. Now the convention also uses the concept of unjustifiable termination, and if I could refer the Court without taking them to the particular provisions, Articles 8[cedilla] 9 and 10 refer to this concept of unjustifiable termination, and we submit it is this concept which is relevant when it comes to considering the remedy for termination.

When one looks at this convention one sees that the background to it and the understanding of the ILO in respect of it, is that there will not be a justifiable reason for dismissal unless, firstly, there is a valid kind of reason related to conduct or capacity of the worker or operational requirements of the workplace, and secondly, that reason is sufficiently serious to justify termination. And if I may refer the Court to the materials which we refer to as the explanatory memorandum in this case for the purpose I have already submitted, which are seen in tab 5 of volume 1 of our materials at page 28.5, which spells that out .

In the 1981 ILO report which surveyed State practice with a view to drawing up the convention, it found this was a common practice in the States, that there should be a valid kind of reason related to conduct or capacity of the worker or operational requirements and that the reason had to be sufficiently serious to justify termination. One picks up that report in volume 2 tab 13, especially at pages 23 and 24. I will not take the Court to these particular passages unless the Court indicates it desires me to, but the references speak for themselves. And we refer also to the most recent 1995 survey, volume 2 tab 18 of our materials.

So it is our submission that section 170DE, in bringing in this concept, at page 32,004 of harsh, unjust or unreasonable termination, is a provision which is reasonable appropriate and adapted to give effect to the convention, especially Article 4, which we say is the principal obligation, that you should only be dismissed for a valid kind of reason relating to conduct, capacity or operational requirements which is sufficiently serious to justify determination.

Article 5 and Article 6, for that matter, of the convention, merely indicate certain reasons that can never be valid reason, but the list is only a minimum list. It is not exhaustive. All the grounds set out in section 170DF(1), which one finds at page 32,021, even if not referred to expressly in Article 5, in our submission, could be regarded as consistent with the provision and discharging the objects of the convention. In this regard, we refer, going to the general survey 1995, volume 2, tab 18, particularly at page 40.

So, in our submission, section 170DE, far from introducing a new concept which goes beyond that of the convention, merely enacts in a particular form, consistent within the umbrella of the convention obligation which requires a provision along these lines, the concept that there must be an appropriate reason of the requisite sort, in this case defined by reference to concepts which are familiar enough in industrial relations of being harsh, unjust or unreasonable. It is a way of translating, we say, the obligation that the reason must be sufficiently serious to justify termination.

It must be the right sort, it must be serious enough, and what section 170DE does is deal with seriousness. If one challenges it, one is really asserting that as long as you have got a reason, you can be dismissed no matter how harsh, unjust or unreasonable that termination is. The responses say, no, the convention requires another restriction. It requires that the termination should be regarded as sufficiently serious to justify termination.

The States have singled out in reference to section 170DF several grounds; particularly sexual preference, age, physical or mental disability, and refer also in paragraph (1)(g) to parental leave. I think it is convenient if I leave that to Mr Burmester because it will avoid repetition. So, if the Court pleases, Mr Burmester's submissions, in dealing with the issue of parental leave, will also pick up these phrases which have been referred to, particularly in this section, by those who challenge validity. There are some points I could make but, if the Court pleases, Mr Burmester can make them in his submissions at the end of my submissions.

The other matter of challenge is with respect to section 170EDA, the question of onus of proof which was inserted by Act No 97 of 1994. That appears on page 32,023. That is dealt with in paragraph 3.45 of our submissions and also one sees the explanatory memorandum volume 1, tab 10, page 7, dealing with it. It is our submission that this provision merely implements Article 9, paragraph 2 of the convention. The two possibilities set out in Article 9, 2 at page 35,353 are not exclusive possibilities.

Section 170EDA puts the onus on the employer to establish a valid reason within the meaning of section 170DE(1). This is a valid reason connected with employees capacity, conduct or operational requirements. If the employer does this then the employee bears a burden of showing that nevertheless dismissal was harsh, unjust and unreasonable. This, we submit, can clearly be regarded as reasonably appropriate and adapted to giving effect to Article 9, 2 which requires that employees be not left to bear the burden of proof. Indeed, it is probably a little bit more than reasonable so far as the employer's interest is concerned because notwithstanding what we have submitted, the positive obligation for the dismissal not to be unjust, in effect, the onus of establishing the unjustness is on the employee rather than the employer.

As I have indicated to the Court, my learned friend, Mr Burmester, will deal with the particular issues of parental rights and rights to strike which have particular issues relevant to them, and also miscellaneous sections to cover those which are attacked by my learned friends.

BRENNAN CJ: Mr Solicitor, are there any authorities, apart from international authorities, dealing with the meaning attributed to the words "harsh, unjust or unreasonable" in this context in Australian cases?

MR GRIFFITH: Your Honour, there would be authorities in Australian cases. We have not found any that would assist, but could we revisit that, your Honour?

BRENNAN CJ: Yes. Perhaps you could give us a list of them at some stage.

MR GRIFFITH: Yes. Your Honour, it is my understanding it is a standard phrase, at least in State industrial laws, and one would find the usual form of - I see Justice McHugh nodding.

McHUGH J: Yes, South Australia. There is a great deal of legislation.

MR GRIFFITH: It is a familiar concept in industrial law, your Honour, but if we could draw together a short submission that establishes that. Perhaps if we could refer to commentaries as well as all the cases on it, your Honour, but that is the stuff of dismissal issues and now we have an entirely new court created to deal with these issues. It has got 12,000 cases in its list, so if the literature is not enough now, it is going to come forward pretty quickly, perhaps to this Court I suppose, eventually.

McHUGH J: We have got a case now, Byrne and Frew, baggage handlers at the airport. It is under reserve judgment. It is a dismissal case.

MR GRIFFITH: Thank you, your Honour. We will make a short submission but it looks like there is quite a bit there. At the risk of opening up the first part of my submissions which I had left behind, may I make just short reference to the conciliation and arbitration power, the issue of the relationship between section 170MA and 170MC. I have submitted sufficiently to make the point that, in our submission, one cannot extend beyond section 170MA under section 170MC, but a further point perhaps which I did not make clearly before lunch is that in most cases we would submit where there is certification of an agreement being sought an industrial dispute as defined would exist, although of course we submit that is not necessary, and the Commission would have to make a finding as to industrial dispute, and we refer to section 170QJ at page 32,603 which incorporates Part VI of the Act, which commences at page 32,603. It incorporates Part VI of the Act - I am sorry, it is a different page - and that deals with the requirement to find an industrial dispute.

So we say that it is mostly the case, where there is the process of certification, there will actually be a finding under Part VI of the Act that there is an industrial dispute. That does not deal with the situation that your Honour the Chief Justice mentions, that there may be a situation where that does not happen, but our submission is that that is not necessary, or I suppose alternatively we say it must be within power in so far as that does occur, but our submission is that that is not necessary.

But in making that submission, in essence what we say is that if parties reach an agreement, we submit that it must be regarded within the conciliation and arbitration power if that resolves the matter which otherwise may fester and give rise to an interstate industrial dispute because, I suppose to put it bluntly - I think I said so this morning - it could be regarded as a council of despair to say that the system of industrial conciliation and arbitration set up is one which prohibits settlement at the earliest opportunity - I will not take the Court back to the early citations of the Court we referred to on that - and requires to escalation to the point of view that one sees clear cross-border dispute activity before the mechanisms may engage. That is an entirely different context just merely because he is going to be in town this week.

May I refer the Court to what Justice Goff, as he then was, said in Thomas v Nottingham Incorporated Football Club Ltd (1972) 1 Ch 596. This is not on our authorities, but if I could read in one passage. I acknowledge the learned Solicitor of New South Wales for bringing this to my attention. That dealt with the issue of whether or not one could obtain prospectively release from a guarantee in respect of a bank account when the bank account had been closed. It was argued for some reason that you could not. But Justice Goff said at page 606:

The principle is that the surety is entitled to remove the cloud which is hanging over him. It would be strange indeed, as it seems to me, if he can do that where no demand is required, notwithstanding there is no present likelihood of any attempt to recover against him, and yet when his liability arises as between himself and the creditor only upon demand, he cannot seek to remove the cloud until it has started to rain, especially as the provision in the contract of suretyship that the creditor must make a demand upon the surety is clearly a provision for the benefit of the surety. It would be odd, I think, if that provision served as between himself and the principal debtor to put himself in a much worse position than that in which he would stand if it was not there.

I refer to it on this concept of "you have to wait until it starts raining". In our submission, the aspects of prevention which we desire to emphasise in our submissions makes it very much an issue within the heart of constitutional power. It is possible that constitutional limitations do require absurd results. But dealing with the aspect of prevention by conciliation and arbitration of disputes extended beyond one State, in our submission, sensible meaning is given to that to contemplate the aspect of prevention ensuring, as was intended, that matters should be settled at the earliest possible moment, we say, under the aegis of the exercise of the power.

Could I refer then to the corporations power which is dealt with in Part 4 of our submissions commencing on page 68. The principal reference of our submissions are to sections 152 and 164. South Australia in its written submissions on section 152 referred to the fact that the section in its application went beyond power. In our submission, any matter that section 152 refers to arises under Division 3 of Part VIB itself. It is Part VIB which is the source of rights under agreements to which it relates. Section 152 in its application to Division 3 deals with the question of whether the rights which Division 3 confers are exclusive or concurrent with rights which may exist under State or Territory law.

If it is the case that seems to be conceded that Division 3 which confers the rights is within corporations power, we submit then so must section 152 which makes those rights exclusive, and for that reason we submit that the passage from Justice Evatt's judgment in Stock Motor Ploughs v Forsyth (1932) 48 CLR 147, which the learned Solicitor for South Australia referred to yesterday, does not establish that the persons powers, as he referred to in section 51, cannot be used to cover a field. Justice Evatt was referring to the difficulty of a Commonwealth law covering the whole field and subject matter such as aliens. Well, that much may be admitted, but he did not purport to rule out a Commonwealth law dealing with the particular set of transactions or relationships involving aliens and covering that field in the sense of ousting State law with respect to those transactions or relationships. And we say it is clear that he was not referring to that. If he did, then we would submit he cannot be right, but we do not have to do that.

Where the Commonwealth confers rights in or against corporations in a particular aspect of the activities or provides for conferral of such rights, we submit there is no basis for concluding that the corporations power does not extend to providing that those rights prevail over inconsistent provisions of State law. We submit that is self-evident, otherwise those rights might not be able to be effective. So the law is not put there for the mere exclusion of a State law; section 152 does not do that in this context. It is part of the definition of the rights and duties which the Commonwealth creates under the corporations power, and we submit that those rights and duties in respect of Division 3 in Part VIB which are created are to be ones which are wholly provided for within that part itself.

It is within competence of the Commonwealth thereby to say that in effect there is the aspect of exclusive provision of those rights; there is no scope for the entry of State laws. And that is all section 152 does. Of course, by saying that the State law is invalid, all it is saying is that it is inoperative. There is some criticism of using "invalid" in this context of section 109 but, seeing section 109 uses the same word, perhaps that is not such a serious criticism; we know what is meant there.

Section 164: well, as to that, the only argument raised against that to which we address ourselves was Western Australia's proposition that it is outside the corporations power to the extent that it immunises conduct that is not boycott conduct. But, essentially, section 162 and section 163 prohibit participation in boycotts and entering of boycotting agreements. These prohibitions are framed so as to apply where the boycott would interfere with the activities of a constitutional corporation. So we say they are supported by the constitutional power.

Certain kinds of conduct is exempted: section 162(7), section 162A and section 163(4). Each of those provisions provide that sections 162 or 163 do not apply in particular classes of conduct. Now, section 164 provides, subject to certain exceptions in subsection (2), that actions do not lie under State or Territory laws against various classes of persons in relation to boycott conduct which includes breaches of section 162 and section 163.

We submit this is clearly supported by the corporations power since its function is to make it clear that the remedies provided by the Act for boycott are exclusive. It is an aspect of perhaps the coverage that we referred to as being permissible under the Airlines Case that we referred to this morning. Section 164(1) also immunises conduct which would be boycott conduct, but for the three sections I referred to of section 162(7), 162A or section 163(4).

Western Australia says this has got nothing to do with constitutional corporations, but we submit that that proposition misunderstands the nature of the conduct with which we are concerned. The conduct would be boycott conduct but for one of these exemptions. It is necessarily conduct which affects the business activities of constitutional corporations. So there is no problem arising from the application of any aspect of the decision in Dingjan in our respect. This is dealing with business activities of constitutional corporations.

This must be the case since the conduct only falls outside the prohibitions by virtue of one of the exceptions. It follows that it is conduct which falls within the general definitions of engaging in boycott or a boycotting agreement. So the conduct we are dealing with has the same degree of connection with the subject matter of the corporations power as does the conduct which is actually prohibited under sections 162 and 163. Now, if it is conduct which the Commonwealth could prohibit if it chooses under the corporations power, in our submission, equally, it must be conduct which the Commonwealth may foster or protect under the corporations power, including immunising it from liability under State law.

The provision which expressesly authorises conduct that has particular effects on constitutional corporations is a provision which has a differential operation on constitutional corporations, within the terms that your Honour the Chief Justice used in Wagner at page 88 of 128 ALR.

So that here we have a law which imposes duties or prescribes conduct that is to be performed or observed by others and we submit that a law which confers rights on others is in principle no different. The conduct is dealt with in the sense of being protected against a State law is conduct that has significance for trading financial foreign corporations. And section 164, in our submission, therefore, is within the corporations power.

Apart from those observations we adopt our written submissions on that aspect. Now, I will deal briefly then with the issue of acquisition of property at Part 5 of our submissions which appear on page 76 and following of our written submissions. Our understanding is that there are three provisions of the Act challenged under this ground: section 166A, dealing with preventing action in tort being commenced in certain circumstance; Division 4 of Part VIB, which confers immunity from liability under State or Territory law in respect of certain actions, and section 334A which is the section we know preventing employees engaging in industrial action and providing for an award of compensation.

The general issues relating to acquisition are dealt with in some length in our submissions and I will not refer to them but, in relation to these parts which are attacked, it seems, firstly, that the plaintiffs who attack section 166A and also Division 4 of Part VIB are agreed that these provisions do not apply to any vested right so the Wagner problem or, we would say, the Georgiadis problem does not arise. It is a prospective operation.

Dealing with section 166A which starts at the bottom of page 31,853 dealing with restrictions on certain actions in tort. This is a prospective law regulating circumstances in which actions in tort may be commenced. So, we say all that does is what it does; it does not have any effect of acquiring property within the meaning of the acquisitions power. In fact, it does not destroy anything. It only affects a temporary stay of proceedings. The point is dealt with in the written submissions but when one refers to my learned friend the Solicitor-General for Victoria's submissions, as we understood those submissions, my learned friend submitted that a certificate allowing the action to proceed under this section may never issue, as we understood that submission. Perhaps we were not being fair to it, but that is how we understood it.

Subsection (3) allows a person who wants to commence proceedings to give notice to the Commission or a registrar and if the notice is given to a registrar, he or she has to tell the Commission about it as soon as possible under subsection (4). A notice obliges the Commission immediately to take steps to stop the conduct that is causing damage, so there is a preventative aspect, subsection (5). And subsection (6) obliges the Commission to give a certificate in several situations. It is not necessary to go through all of them, but paragraph (c) which is sufficient for these purposes, requires a certificate to be given if the conduct is not stopped within 72 hours of the issue of the notice.

So, a person who wishes to commence proceedings would be able to do so, having obtained a certificate, at most, 72 hours after taking the simple step of giving notice. And, of course, section 166A(1) itself does not prevent action being commenced once a claim to which the conduct relates ceases to be part of a live industrial dispute. So, even if no certificate issued, it would still be possible to seek damages after the dispute came to an end. During the period where one cannot issue, it is not the case that one has no right which could arise out of that period of events which occurred which could give right to a claim in tort, it is merely you cannot pursue the claim for that period which can determined in no more than three days. We do make other submissions in the alternative but they are made in our written submissions.

Dealing with Victoria's submissions in reply, paragraphs 35 to 41 - they were the written submissions filed before this hearing - section 166A does prevent in a limited way a person who suffers damage from enforcing their cause of action at once. I mean, they cannot issue and one supposes they cannot obtain an interlocutory injunction during this period which could end in no more than three days. Section 166A does not take away anything though. What it does is it qualifies new causes of action as they arise.

Georgiadis was entirely different. In Georgiadis there was a vested cause of action which was qualified. In effect, after the period of six months it was destroyed as a result of the operation of the provisions. In respect of prospective claims for tort, all section 166A does is say that they are subject to some limitations, namely, during the protected period, which may be determined within three days and certainly would not be enduring because it will end once the dispute has ended, then those proceedings may be taken. So it is part of the definition of the right, not a part of the taking away of them. It is only an ordinary prospective change in legal rules and, in our submission, it has nothing to do with the acquisition of property.

So it may be that this section does reduce the availability of the remedy, particularly interlocutory injunction, but it is fundamental, we submit, to legislative power that remedies available at common law may be abrogated or modified and different remedies provided. In the sphere of Commonwealth power we submit the Commonwealth may override, abrogate or supplement the remedies for particular wrongs available under State law, including the common law, certainly when that is done prospectively. Retrospectively, well, then there might be a just terms issue. The desirability of such a change is another matter, but that is not a matter which goes, we submit, to the question of power.

If, as Victoria submits, you acquire property when you prospectively limit the circumstances in which common law actions may be brought, it follows that you must also acquire property when you grant new rights of action. So if this were the case, one would suppose the Commonwealth could never alter or override the common law because on one side or another there would be a claim of an acquisition of property and this is not a role of this power. We refer to what was said by Justice Brennan, as he then was, in Mutual Pools v Commonwealth [1994] HCA 9; 179 CLR 155 at about midway down page 180 where your Honour said:

It would be erroneous to elevate the constitutional guarantee of just terms to a level which would so fetter other legislative powers as to reduce the capacity of the Parliament to exercise them effectively.

Turning then to Division 4 of Part VIB, the core provisions for present purposes is section 170PM(3), which is found on page 32,551. Here, again, we say that there is nothing to displace the ordinary presumption that the Act does not disturb vested rights. Victoria agrees with this proposition. In our submission, it follows that subsection (3) does not affect anything to be called an acquisition of property. We rely upon the same submissions that we have just made in reference to section 166A.

In effect, Victoria submits that the Commonwealth cannot prospectively override tort law, and we say that is not so. We make some alternative submissions on section 170PM(3) in our written submissions, which I will not take the Court to. Section 334A, which is found on page 34,301, has two subsections which are challenged, subsection (2) and subsection (7)(b). This is dealing with the issue of dismissal which we have already referred to.

Subsection (2) erects a basic prohibition on dismissing or penalising a worker merely because he or she engaged in industrial action. There is mention of Victoria's second submissions in rely, paragraph 43. The other provision attacked is paragraph (7)(b) which allows the Court to order payment of compensation when subsection (2) has been breached. We submit that subsection (2) does not require an employer to continue to pay an employee while that employee is not performing their duties. It does not purport to override and does not override any provision of an award or employment agreement that allows pay to be withheld in respects of periods of unauthorised leave or non-performance of duties.

Provided that the relevant award made salaries or wages depending on performing duties rather than holding office, an employer is free to withhold pay for an employee when the employee is not performing the duties of their position. So that either the enforcement of an employer's rights under an award of contract of employment does not injure the employee or alter the employee's position to the employee's prejudice for the purposes of subsection (2) or any injury, is not infected merely because of industrial action but rather because of failure to perform duties, at least where the employer treats all absences from work or refusal to follow directions equally in this respect, whether they figure in industrial action or occur for other reasons.

So we say it is not correct to submit that subsection (2) requires an employer to continue to pay an employee despite receiving no consideration or advantage in return, as is said in Victoria's additional submissions, paragraph 43. Section 334A does not affect the obligations of employees and employers regarding work and payment of salary and wages. It does not target an employer's ability to insist on a fair day's work for a fair day's pay. Rather, it seeks to prevent employees engaging in industrial acts to prevent them from being singled out for treatment, such as dismissal, denial of overtime and so on.

In that reason, we submit it is not, in any way, an acquisition of property. Paragraph (7)(b) dealing with compensation, in our submission, as our written submissions explain, this is part of the penalty for breach of the rule and, therefore, could not fall within the acquisitions power. The fact that subsection (2) prescribes a penalty for its breach does not alter the true nature of paragraph (7)(b) or its characterisation for constitutional purposes. Nor is the characterisation of paragraph (7)(b) altered by the fact that it serves restitutionary ends. It imposes a detriment on someone who has breached a legal rule in consequence of that breach. It therefore imposes a penalty within the scope as applied in Re DPP; Ex parte Lawler, which we refer to in paragraph 5.15 of our submissions.

If I may turn then to Part 6 of our submissions, Melbourne Corporation. May I indicate to the Court, travelling at this point it may well be that our submissions will be completed by 10.30 am or so tomorrow, if that is assistance in listing, your Honour.

BRENNAN CJ: That will be a very satisfactory result, Mr Solicitor.

MR GRIFFITH: Yes. I hesitate to say by this evening, your Honour, but let us see how we go. The Melbourne Corporation principle, dealing with the issue of higher levels of government. Well certainly - and I am anticipating a bit of what we will say in severance - we are not altogether clear that it is the case, as the Solicitor-General for New South Wales submitted this morning, that no one will contend that the Melbourne Corporation principle should give rise to total invalidity in the event that one were to construe parts of these laws, including employees at the higher level of government. We are not too sure whether ,on the left-hand side, that is conceded or not conceded, but we would certainly agree with the characterisation of my learned friend on the right-hand side that that would seem to be a bold proposition.

But there are three sets of provisions which we see as being said to be held valid, because they empower the Commission to make orders in relation to employees at the higher levels of government. These submissions seem to be based on the State Employees' Case, and the provisions challenged as far as we see it are Division 1 of Part VIA, that is minimum wages, and we deal with that in paragraphs 6.6 to 6.11; Division 2 of Part VIA, that deals with equal remuneration -we deal with that at 6.15 to 6.16; and Division 3 of Part VIA, which deals with termination at 6.25 to 6.26.

Now we concede that all these provisions must and are read so as not to apply to employees at the higher level of State government. Now that is not an issue between the parties and it never has been. And we say that the provisions just read in their ordinary meaning do not so apply but, if necessary, we submit that it is possible and convenient to read these submissions, firstly without reference to the Acts Interpretation Act, so as to not cover employees at the higher level of government - and I use that expression with the meaning embraced by the decision of this Court in the State Employees' Case.

We say secondly and alternatively, if further necessary, one can rely on section 15A of the Acts Interpretation Act, comfortably to get that result, although we do hope it is the case, as the Solicitor-General of New South Wales seems to understand it, that no one is really intending that you have to go very far to get to this position, and if it were necessary, we would say also that section 7A would assist. However, we say that, in our submission, it does not assist here and it is not necessary for it to assist. We do not really see that it is necessary for it to call in section 7A. We do not see it as having any work to do here on this issue or, indeed, we do not rely upon it as having any particular and necessary work to do on any issue of reading down, as embraced by our submissions to the Court.

So that our submissions will be made really on three levels on this issue: firstly, deal with the issue of this construction of employees at higher level of government, the manner in which we say the Court can comfortably get to the result of making it clear to hold that none of the provisions operate to bind employees at this higher level of government; secondly, we will make some general submissions as to the issue of severance in this case more broadly beyond this higher level of government issue[cedilla] and on that the Court will see from, when we refer to severance, that there are open issues of severance which may arise if there are various permutations of possible invalidity. And then thirdly, when we deal with the issue of severance, we will deal with the issue of, if the Court needs to determine it, perhaps it is like arguing Re Wagner again, that it is a matter to be argued before the Court, but once again, in our submission, probably not to be determined as to whether or not section 7A does have any constitutional difficulties. We submit that it does not, but it is not necessary for the Court to decide it in this case.

Leaving severance aside for one moment, and looking at the question of whether or not these provisions empower the Commission to make orders in relation to employees at the higher level of government; we say that it does not give rise to any need for the Court to determine in the abstract the exact scope or operation of these provisions which are attacked. The proper occasion for determining a true construction of these provisions will arise when those provisions come before the Commission. That is how the State Employees' Case went off, in effect. So that, if there is a particular dispute, you leave it to the Commission to determine the reach of its orders. If they accede the possible ambit to that extent they will be invalid. As Western Australia says in paragraph 2.4 of its further submission, all is having particular effect on the States are beyond the powers of the Commission. If the Commission trespasses then the usual remedies are available. We submit that as was held in State Employees' Case, 69 ALJR 465, it does not follow that provisions conferring power in terms such as these are invalid.

Dealing with Part VIA, Division 1, in response to the submissions of Victoria in its reply, paragraphs 48 to 50, Victoria submitted that Divisions 1 imposes a requirement on the States that it does not impose on other employers and therefore offends a discrimination limb of Melbourne Corporation. As we understand our learned friend, that submission is not one which was in the end pressed; I am not sure whether that is so. If it is - - -

TOOHEY J: It was only pressed in terms of discrimination against Victoria and Western Australia vis-a-vis the other States; not as between the States aggregated on the one hand and private employers on the other.

MR GRIFFITH: Yes, and employees. That is how we understood it, your Honour - and the higher levels part, my learned friend says. Your Honour, that is how we understood it, so I think on that basis we can not address that proposition.

Victoria's argument, as your Honour said, then said that Division 1 singled out the States of Victoria and Western Australia and imposed special burdens on them. Our submission is Division 1 does not impose any relevant burden on those States as employers or as juristic entities but it does not impose on other entities within the boundaries of Victoria and Western Australia. All that Division 1 does, as far as the State governments are concerned in those two States, was to seek to implement a policy position in relation to industrial relations for employees in those States which is contrary to the policy position of those governments. It put the State governments in the position that where as lawmakers they needed to legislate in a particular way if they did not want the Commonwealth laws to apply; but this does not amount to singling out the States as juristic entities for adverse treatment as compared to other persons. This division only differentiates between States as geographic entities, that it applies different rules according to whether or not a group of employees is within a State that has laws for compulsory arbitration. If this is discrimination, it is our submission it is not discrimination of a kind to which the Melbourne Corporation principle is concerned. We submit that it is not discrimination.

Victoria submitted that this division discriminates betweens the States because it does not differentiate on rational and relevant grounds. Section 170AE(3) we submit is indistinguishable from section 111(1)(a) which was considered in the State Employees' Case. Both are general provisions capable of operating in all States and the criteria on which they operate are not so narrow as to be characterised as a device for attacking certain States.

Section 170AE(3) gives effect to Parliament's judgment that the Commission's jurisdiction to make a common rule should not be imposed when employees minimum wages were capable of being determined by compulsory arbitration or some form of registered agreement. Other positions may have been adopted, for example, as the plaintiffs have said, Parliament could have decided not to give the Commission power to set minimum wages where there was a State law fixing wages by regulation or wages board.

This does not take the choice that Parliament has made outside the realm of what is rational and relevant. Parliament is within its rights, we submit, to decide to defer to arbitration individual disputes at the State level but not to defer to a competing system of common rules at the State level. In his oral submissions, the Solicitor-General for Victoria seemed to raise an argument based on the impairment limb which is essentially that Division 1, he submitted, dictates to the States the form in which legislation must take.

This, we submit, is not the case. Division 1 provides a certain consequence follow if there is not a scheme for compulsory arbitration at State level. It leaves a decision whether to enact or maintain such a system entirely up to the States in both form and substance. So the application of the Commonwealth system to minimum wage determination is not a punitive measure imposed on a State. It is an outcome which some States might welcome. Well, one State is here at least supporting all the Act.

In any event all that Division 1 does is to influence the choice a State makes in the exercise of some element of government power. The decision in State Employees - and if I could give the reference to the ALJR reference at page 463, 128 ALR reference at 627, 628 - establishes that a law which inhibits a State's exercise of governmental power does not thereby impair the State's capacity to function as such. The impairment leading to the Melbourne Corporation principle is concerned with the core functions of a State, its decision making processes, capacity to employ people to carry out its policies, rather than the extent of the State's power to control conduct. In this connection we refer to the Court's decision in the Native Title Case, in particular[1995] HCA 47; , 69 ALJR 309 at page 350 and [1995] HCA 47; 128 ALR 1 at page 59.

Next if we turn to the question of interference with a State's power to dismiss employees on termination of employment, Division 3 of Part VIA and the separate argument on section 334A. We submit that the State Employees' Case establishes the impairment limb of the Melbourne Corporation principle protects State's rights to determine the number and identity of persons it wishes to employee, the appointment of such persons and the number and identity of the persons whom it wishes to dismiss with or without notice from its employment on redundancy grounds. One finds a relevant passage in ALR 630 and ALJR 465. We submit that this passage should not be read as marking out areas into which the Commonwealth cannot go, which seemed to be the proposition put by the Solicitor-General for South Australia yesterday.

Neither the basic Melbourne Corporation principle nor the words of the judgments of the members of the Court in State Employees' demand the result that Commonwealth laws cannot apply, for example, to the termination of employment on redundancy ground of State employees. What the principle requires is the State retain the ability to control the size and composition of its work force, thus the capacity of the Commonwealth to control termination of employment by a State is limited in this way but not eliminated.

Turning to the issue of termination, which is dealt with in paragraph 6.18 to 6.24 of this part of our submission, Division 3 of Part VIA does not affect a State's rights to determine whom it will hire and for what term of employment. It only governs the circumstances in which the employment may be terminated. Section 170DE, as we have already seen, prevents a person's employment being terminated for no valid reason connected with his capacity or conduct or based on the operation of the employer or if the termination is harsh, unjust or unreasonable.

Some particular grounds are also identified in section 170DF as invalid grounds. None of these grounds relate to employees' capacity or conduct or genuine operational requirements of an employer. An employer is also required to observe procedural requirements, section 170DB to 170DD. Essentially these are giving notice or compensation in lieu of notice and the provision to the employee of an opportunity to answer allegations unless it is unreasonable to expect that opportunity to be extended, section 170DC.

Division 3 does not prevent a State terminating the employment on grounds going to competence or conduct, nor does it prevent terminations on redundancy grounds. It does require that terminations of employment on these grounds be effected in a fair manner with notice or with reasonable compensation in lieu of notice. In effect Division 3 imposes minimal standards of reasonableness on an employer in the matter of terminations.

The decision in the State Employees' Case elaborates a basic principle the Commonwealth cannot make laws which threaten the State's capacities to function as a government. Looked at from the point of view of principle, the submission that Division 3 is invalid amounts to a proposition that a necessary condition of a State's capacity to function as a government is it be allowed to act as an unjust and unreasonable employer. We submit that this manifestly cannot be the case. So, we submit the compliance with the requirements of Division 3, even though it does represent a qualification to the State's ability to dismiss employees, does not compromise a State's capacity to determine the size of its work-force, the skills and experience of the people it employs or the tasks that those people perform.

The requirement that, in terminating employment, the State must face the decision who it is to dismiss on grounds which are rational or relevant to the State's operational needs and not to make it capriciously or on relevant grounds such as ethnicity or gender, does not impair, we submit, a State's ability to function. The requirement that employees who are dismissed be treated with a basic level of fairness, for example, given notice or compensation in lieu, constitutes, at most, a marginal impairment of a State's ability to hire and fire employees. And we submit it is not inconsistent with the existence of the State in a federal system.

Turning now to some of the particular provisions that are addressed in Victoria's submissions in reply, in paragraph 59, Victoria refers to section 170FA which is found on page 32,052 of CCH. This allows the Commission to make orders for giving effect to Articles 12 and 13 of the termination of employment convention. The power to make orders giving effect to Article 12 only applies in so far that that article deals with separation allowances and other separation benefits. This power cannot be exercised inconsistently with the Act; it would not allow the Commission to order compensation in lieu of notice in addition to that provided for under Section 170DB.

An order of the Commission in relation to Article 12 may affect the cost to a State of terminating a person's employment. But that does not affect the ability of the State to do so if it decides that, on balance, that is the correct course. The State Employees' Case does not suggest that the Melbourne Corporation principle guarantees a State a right to dismiss its employees without granting them any payment or other benefit. The State is, in principle, in no worse position than a private employer to meet the costs of termination ordered by the Commission. States are able to raise money through taxes rather than depending on profitability and are generally in a better position in this regard than private employers.

Being exposed to the same risk as other employers being required to pay a termination benefit determined by the Commission, does not, we submit threaten the State's ability to function. Article 13 only goes to the provision of information and opportunity for consultation; it does not go to a State's ability to effect terminations. A requirement to consult with employees' representatives does not, we submit, qualify a State's freedom to hire and fire in a way that is inconsistent with the State's capacity to function as such. Section 170GA also goes to consultation with employees' representatives than to a State's ability to effect terminations, which would be so characterised.

Turning back to section 334A which we refer to in this context in paragraphs 6.37 and 6.38, these are matters dealt with by Western Australia's further submissions, paragraphs 3.0 and 3.1. Section 334A is challenged on the ground that it interferes with a State's right to dismiss its employees. It prevents dismissal on particular grounds, namely participation in industrial action. The arguments we have just made in relation to Division 3 of Part VIA also apply here. We submit it does not prevent a State dismissing employees whose services are no longer required for operational reasons or who are not capable of doing the work for which they are engaged, nor does it prevent the dismissal of an employee who engages in unacceptable conduct such as sexual harassment or fraud.

If a State government takes the view that industrial action amounts to unacceptable conduct, we submit the Commonwealth Parliament, in exercise of its constitutional power, is entitled to take the view that participation in peaceful industrial action should not be a ground of dismissal. Preventing a State from dismissing an employee on this ground may offend a particular State government but, in our submission, it does not have any bearing on that State's ability to control the size of its workforce or to continue to control the composition in terms of skills, experience and seniority. It does not, we say, have any effect on the State's capacity to function as a government.

BRENNAN CJ: What is meant by operational things? If the State simply decides it does not want to have a workforce of this size any longer, is that an operational consideration?

MR GRIFFITH: Of course it is, your Honour. That is the very heart of redundancy, in our submission. What if you privatise some aspect - cleaning in schools - so all school cleaners are to be made redundant, your Honour? That is the very area we would suppose; it is the heart of it.

BRENNAN CJ: So the elimination of an operation is within that clause?

MR GRIFFITH: Yes, your Honour, within the clause that authorises dismissal.

BRENNAN CJ: So that if it is decided, for example, that there will not be any more buses conducted by public transport, that is - - -

MR GRIFFITH: Of course one can dismiss, yes, your Honour.

GUMMOW J: What do you say, Mr Solicitor, about this distinction between maximum and minimum in relation to paid rates awards?

MR GRIFFITH: Your Honour, I was going to get to that. My quick answer is that there is nothing in the Act to prevent you paying more. The argument was that you cannot recruit; the answer is that you can. The provision of the Act merely provides that the sanction under section 170UD is that the award can be cancelled. That is the only sanction, your Honour, and indeed last week I was arguing an appeal on this issue of paid rates. We were arguing the issue: what is the sanction? Of course there is a sanction if you pay less than paid rates award because then there can be contravention of a provision of the Act. If you pay more, your Honour, it seems that there is absolutely no learning whatsoever, that that is regarded as constituting a breach of the award, and it becomes a matter of degree to which departure results in the sanction of the paid rates award being cancelled because of the parties' failure to comply with it.

TOOHEY J: It is a bit curious in some ways, is it not? It speaks of actual entitlements, not only as to wages but as to conditions of employment generally which, I thought we were told, on one view, meant that no more could be paid, at least in the case of money.

MR GRIFFITH: We were told that, your Honour, yes.

TOOHEY J: You put a different - - -

MR GRIFFITH: Well, your Honour, our submission is that there is no occasion, with respect to paid rates, wherever there has been proceedings for contravention for having pay and conditions in excess of paid rates, and the only sanctions we submit, your Honour, is if the parties depart significantly to the extent that invites an order for cancellation, that is the risk that they run, but - - -

TOOHEY J: Well, since what you say would certainly be true of a minimum wage, one wonders why the two categories exist in the Act.

MR GRIFFITH: Well, your Honour, there are historical reasons for paid rates awards in certain industries. An obvious one is the public sector where the award rate is the rate that you are paid, and that is the mechanism by which they operate. There is a suggestion that in respect of this particular provision Justice Gummow referred to, it was introduced as compensation because of the loss of a right to strike during the process of - - -

GAUDRON J: Well, originally, of course, they came about to stop claims for over-award payments on building sites.

MR GRIFFITH: On building sites, your Honour?

GAUDRON J: Yes.

MR GRIFFITH: Thank you for that bit of history, your Honour, yes.

GAUDRON J: There was a building industry award and then there were claims made one by one against individual sites for over-award payments.

MR GRIFFITH: But, your Honour may correct me, but as I understand it, in that context, the sanction was, "Well, if you get the benefit of a paid rates award, well, then, normally that's all you're going to get, and if you don't play the game, you're at risk to losing the entire award". That is the sanction, not proceedings for breach of the provisions of the award by over-paying. So we would answer my learned friend Mr Cock's point by saying that there is nothing at all to stop the State of Western Australia employing, for example, a secretary to a Royal Commission at the rate of $10,000 a week if it chooses to, whatever the relevant awards might be.

TOOHEY J: Save that the award might be cancelled.

MR GRIFFITH: Well, save that the award might be cancelled, your Honour, but that does not seem to be a sanction which could apply because of an individual employee having a particular contract, but the submission put against paid rates is that that prevents a State recruiting star performers, as it were, and the answer we make is it does not. There is nothing at all to inhibit such one-off contracts or whatever is referred to, or even for groups being made.

There is, if one has a general derogation from the award, and one has to look at what that constitutes for the purpose of the exercise of the power, the risk of cancellation, but the fact that a State chose to choose particular employees that it decided on the basis of paying more than paid rates would, on the face of it, seem to be a situation that would be unlikely to result in the cancellation of an award.

Looking again then at Part VIB, including Division 2 and also Part VIA Division 3, when one looks at Victoria's submissions, paragraphs 60 to 65, one sees an argument that does seem to apply to both Division 3 of Part VIA and Division 2 of Part VIB. It argues at paragraph 61 that Division 3 discriminates between the States by imposing the same burden on the States as on other employers, and this argument is made in paragraph 65 to Division 2 of Part VIB.

So these provisions are said to be discriminatory, we suppose, because they treat unalike subjects in a like manner. So the distinction which it said the law should take into account is, the States have a right to determine the size and composition of their work forces in a manner that private employers do not. We submit that this argument attempts to extend the scope of the impairment limb of the Melbourne Corporation principle by making one of the propositions which that limb entails into a trigger for the application of the discrimination limb. Thus the principle was asked to, in effect, pull itself up.

In our submission, the discrimination limb where it prevents the treatment of unalike things in a like manner does so only by reference to the practical attributes and circumstances of those things and not by reference to the rights which the Melbourne Corporation principle has supposedly given them. We submit no argument has been given to the Court and there is no evidence to show in practical terms the requirements imposed by these provisions are more onerous for a State than for a private employer of a comparable size, so we submit that the possibility of discrimination here could not arise.

Looking now to the special regime imposed on the States in respect of certified agreements under Division 2 of Part VIB. This is referred to in paragraphs 6.30 to 6.31 of our submissions. Actually, if I could say looking at that, your Honour, our submissions say it all, so could I adopt the submissions.

TOOHEY J: Can you just give us that reference again, Mr Solicitor.

MR GRIFFITH: Your Honour, dealing with the special regime imposed on States and certified agreements, paragraphs 6.30 to 6.31. Could I leave that to the Court read and not summarise it. We stand on our submission for that. Ability to control industrial action, immunity from civil liability, Division 4 of Part VIB, our submissions paragraphs 6.33 to 6.36. The plaintiffs argue that by conferring immunity from civil liability in respect of conduct relating to industrial action Division 4 impairs the capacity of the State to function as a government. Now, looking at employees generally in the State, the argument appears to be directed at the control of industrial action generally, that it is argued that the control of industrial action in a State is essential to the State's capacity to function as a government. This seems to be Victoria's submission in reply, paragraph 66.

In this respect all that Division 4 does is to limit the exercise by the State of some elements of governmental power. We have referred to passages of the State Employees' Case and the Native Title Case which establish a law which inhibits a State's exercise of governmental power and does not thereby impair a State's capacity to function as such. So, for example, looking at the argument here put, if you put it in relation to, say, aviation or the activities of a trading and financial corporation, it really seems like the argument made in relation to Division 1 of Part VIA, more an attempt to reopen the Engineers' Case by carving out limitations on Commonwealth power on the basis that there is some governmental powers which a State ought to be able to exercise, in this case it is claimed generally the power in respect of the ability to control immunity from civil liability in respect of industrial action in the State.

Victoria argues that industrial action by non State employees can seriously affect the operations of the State - paragraph 67 and 68. We say that really looking at an issue such as a power generation as an example of a privatised utility, if a decision is made to take an enterprise or an activity outside the public sector, we say it should not come as a matter of great surprise that the ability of the government to control all aspects of that enterprise is thereby diminished. We would emphasise that the limitation that Division 4 contains as to the action which can receive immunity - and we have already referred to those in detail - can only be said to sustain short-term industrial action and then only if it does not threaten life or limb or significant parts of the economy. So that the effects of the State works force and the operations on the organs of government, which Division 4 allows to occur, does not, we submit, and could not, pose any serious threat to a State's capacity to function as a government.

Any industrial action which generally threatened the capacity of the State in particular circumstances, for example, it prevented Parliament or courts from sitting, could be said to threaten the welfare of part of the population and fall within section 170PO(1)(b) of the Act. The Commission could then suspend the bargaining period and would be under a duty to consider doing so. It is not to the point that a State may have no right to invoke the Commission's power under this section or to be heard, as Victoria submitted. The Commission is under a duty to consider whether to exercise its power to do so after hearing the parties on all bases of all relevant factors. The requirement of 72 hours notice in section 170PH makes it unlikely that any irreparable damage could be done before the Commission had an opportunity to consider it, because that is the extent of the period of inhibition.

We submit that provisions of a Commonwealth law should not be declared invalid on the basis of speculation of the effects that they might have, perhaps indirectly, in some particular situation in a State. If the situation does arise where there is a real possibility that there should be protection from the liability accorded from Division 4 which will impair the continued functioning of a State, well then we submit that may be a time to consider whether or not any issue arises but, in our submission, my learned friend has not established even an outline basis for present constitutional attack.

Looking then to section 170PP, which was part of the attack in the additional submissions of Western Australia - that appears on page 32,552 - the Western Australian submission is that this is invalid for two reasons: firstly it requires the making of a paid rates award, which is said not to deal with minimum rates of pay in the terms of State Employees' Case. This is said to have been an infringement of the impairment limb; and secondly it allows the Commission to make award in relation to State employees; it is based on the merits of the individual case rather than the principle or standards set for a group of employees. And this apparently was alleged, as we understood it, to be discriminatory.

We submit section 170PP(4) allows the Commission to depart from standard principles in relation to any dispute which comes before it, whether or not it involves government employees. It treats all employees the same way, and we submit that section 170PP(4) which, as we understand it, has suggested it discriminates against the States, is that many provisions of Commonwealth law may on their face allow a decision maker to single out States for adverse treatment, but subsection (4) allows a decision maker to differentiate only on the basis of criteria which are consistent with the purpose of the Act. And of course a decision not to apply standard principles because the employer was a State, we submit, would be something which pretty clearly would be beyond power; certainly it is something which could be challenged there.

Section 170PP only applies where a bargaining period is terminated on the grounds mentioned in section 170PO(1)(b). This is where industrial action is threatening the life, personal safety, health or welfare of the population or threatening to cause serious damage to the Australian economy or an important part of it. So, it only applies in exceptional circumstances; it is an emergency power. Section 170PP(3), which requires the making of a paid rates award, can be avoided if the parties agree that it should not apply, subsection (5). And, as we have already mentioned, our third point we make here is that the Act does not prevent a party paying more than a paid rates award prescribes.

Subsection (7) prevents an award being made under section 170PP being varied for a fixed period but if a State pays a person more than an award rate, the only sanction is, we would submit, that under section 170UD and this is an unlikely sanction to apply in situations which are postulated by Mr Cock. Of course, the other thing a State could do is, if it desires to recruit an employee in an upgraded situation, it can upgrade the situation. It does not have to leave the employee at the low grade which may be prescribed under a particular paid rates award.

One would suppose that many of the postulated examples of having to pay to recruit would be more likely to fall into the higher levels of State service which are not covered by these provisions in any event. One cannot say that section 170PP will result in the State being subject to a paid rates award in all but unusual circumstances. The State Employees' Case does not support the argument that the Commonwealth may only give the Commission power to set minimum wages and conditions. The majority judgment at 69 ALJR 465, left-hand column said:

the prescription by a federal award of minimum wages and conditions would not infringe the implied limitation, at least if it takes appropriate account of any special functions or responsibilities -

Then it says that there might be a question about an award regulating promotion and transfer. Earlier, at page 463, right-hand column, the judgment said:

the existence of the States and their Constitutions and their capacity to function as governments would not be impaired by the operation of federal awards made in respect of the vast majority of the employees.....at any rate if the award provisions were confined to minimum wages and working conditions which take appropriate account of any special functions or responsibilities -

We notice that Western Australia - it is paraphrased in paragraph 2.3 of its additional submissions - left out the phrase "at any rate" so each of those quotations we refer to the Court as referring to at least, at any rate, it has not been comprehensive, in our submission. These passages do not say that it is not only that an award dealing with minimum wages and conditions may be made and then only if it takes account of special functions of State employees, they say that if such an award clearly does not infringe the implied limitation, and they leave open whether or not other kinds of awards will do so.

It is not a case that the decision is authority to say one can only have a minimum rates and not any other rates award. The Court was not dealing with that consideration. It was saying that a minimum rates award in these terms certainly would not contravene. What really matters is the principle, in our submission. Does being bound by a paid rates award in a very limited circumstance as postulated by section 170PP impair the ability of the State to continue and function as a government? We made the point that the situation is very limited; we make the situation that the State is free, as we submit, to pay over award rates.

BRENNAN CJ: Mr Solicitor, if the State agrees with an employee to pay above the paid rates award, does the employee have any right to recover that excess?

MR GRIFFITH: We would suppose he would, your Honour.

BRENNAN CJ: Why would you suppose that?

MR GRIFFITH: Your Honour, because if there was an agreement with the State to pay it, the employee would be entitled to recover under that agreement.

BRENNAN CJ: Under that agreement; unaffected by the paid rates award?

MR GRIFFITH: Yes, your Honour.

BRENNAN CJ: Why is that?

MR GRIFFITH: Perhaps we are dealing with things unlikely to occur, but the fact that it might be put that the paid rates award was expressed on the view that that amount shall be the salary, assuming it is an issue of salary, we submit it might be a matter to be worked out as a matter of common law defence, your Honour; could not be used to justify a defence of illegality on what otherwise is an agreement freely entered between the two parties with a payment of a higher sum. Perhaps this is not the occasion to work through whether or not such defence should be pleaded or whether or not it would a credible one but we submit that the complete absence of any literature at all to indicate that payment in excess of an amount of a paid rates award can result in anything more than a sanction of being at risk for cancellation of the award, would indicate that there is not a situation of operative illegality that would raise as a - - -

BRENNAN CJ: I do not know whether it is the occasion to decide the question that you say we do not have to decide or not.

MR GRIFFITH: That seems to be the issue your Honour postulates.

BRENNAN CJ: Yes. I mean, if the situation is that the effect of a paid rates award is to preclude the arising of any cause of action for the excess, then one imagines that has some significance.

MR GRIFFITH: Your Honour, our submission is that it is not and never has been regarded as having that effect; the sanction as a risk of - - -.

BRENNAN CJ: It has never been put to the test?

MR GRIFFITH: The only test is that when I was arguing last week on this issue I challenged my opponent to give any example of enforcement of an obligation not to pay more and none was forthcoming.

DAWSON J: That really misses the point, does it not? That really misses the point because it is an obligation which is imposed by the award which is an obligation imposed by law, and one would expect that the States would observe their legal obligations. That is the way you look at it.

GAUDRON J: It may much depend on the terms on the actual award that is made. By and large, the operation was thought to have been that employees could not make separate claims for over-award payments and (b) that their entitlements were calculated by reference to the specified paid rates and not what would otherwise have been minimum entitlements. I do not think there was ever any provision in the paid rates awards precluding additional payment. But there were, I think, provisions precluding the employees from making over-award claims.

MR GRIFFITH: I am indebted to your Honour for that. I am sorry, my learned friend invited me to refer to section 170UD, which is the section I have already referred to about cancellation, and that is what we suggested - - -

TOOHEY J: It does not really answer the question, does it?

MR GRIFFITH: No, except my learned friend was whispering to me.

TOOHEY J: Except in so far as you might argue that since the only consequence spelt out in the legislation is cancellation of the award, there is nothing, at least within the statute, that appears to preclude the parties from enforcing an over-award agreement.

MR GRIFFITH: That seems to be the position, your Honour. If one wrecks the paid rates system, then it is regarded that it does not necessarily have to be maintained by the sanctions of - - -

DAWSON J: Either the award imposes an obligation to pay a particular rate or to pay a minimum rate. I mean, you cannot have it both ways. You cannot say the paid rate is really only a minimum rate. If that is what it is, well, that is what it says. If that is what it says, that is what it is, but if it is a paid rate, it is an obligation to pay that rate, is it not?

MR GRIFFITH: Your Honour, it might depend what a paid rates award is because it is sort of a buzz-word to distinguish it from a minimum rates, as we understand it.

DAWSON J: If what you say is right, then it is nothing more than a minimum rate and a distinction is drawn.

MR GRIFFITH: Your Honour, in the context that if it is called a paid rates, it is normally expected that that will be what is paid for those bound by it unless there is gross derogations and then it will be cancelled.

DAWSON J: The award imposes an obligation and it is a question of what the obligation is, is it not?

MR GRIFFITH: Your Honour, the upshot seems to be the obligation is not to pay less and paid rates includes not just pay, but conditions.

DAWSON J: That is a minimum rate and there is no difference.

MR GRIFFITH: It is pretty close to it, your Honour, except - - -

DAWSON J: There is no difference at all.

MR GRIFFITH: In most cases it may be that, unlike minimum rates, there is not a common practice of paying more.

DAWSON J: I do not understand this argument by saying nothing happens if you do not do it because that does not really take it to the nature of the obligation.

MR GRIFFITH: Your Honour, it might really be for the cognoscente to define what "paid rates" mean. Paid rates does not necessarily mean you pay this and no more. It means it is an award set at a higher rate from being one that just establishes minimal standards.

BRENNAN CJ: But it may mean that we need to be the cognoscente.

DAWSON J: Which we are not at the moment.

MR GRIFFITH: Your Honours have remitted much of its jurisdiction to the - or have a capacity automatically to remit and Iam sorry to hark back on my experience last week, your Honour, but after running three appeals I certainly would not invite the Court to bring it back again. It is not getting any better since Justice Gaudron's Kirby speech last year, but I am sorry about my inability, your Honour, but really this field is worse than tax. If one does not do it all the time, it is very difficult to hold oneself out as authority beyond doing one's best to understand the plain words of the Act.

GAUDRON J: And I do notice that the numbering or the lettering of the sections has borrowed largely from the Tax Acts.

MR GRIFFITH: Your Honour, by that remark I was not seeking to be unhelpful but it was just interesting the point Justice Dawson makes was one that crossed my simple mind last week and I was educated to have reduced expectations from taking plain meaning as plain meaning.

GAUDRON J: It should be quite possible, however, for the Commonwealth to put its hands on a paid rates award that has been made by the Commission and to make it available to us.

MR GRIFFITH: What if we do that, your Honour the Chief Justice? We will produce one.

BRENNAN CJ: That might be of some assistance. It might even explain itself. Who knows?

MR GRIFFITH: That is the worrying point, your Honour, whether it does explain itself because one does not know how these are regarded, other than you know from 170UD, if there is gross derogation by the parties not sticking to it, as it were, you are liable to get it cancelled and your building site gets thrown open or whatever.

BRENNAN CJ: Perhaps you might have a search made, Mr Solicitor, and if there is one available that would illuminate it, then and you could make it available.

MR GRIFFITH: One little bit of information I gleaned, your Honour, is that one reason this provision was put in apparently was because it was thought that it would compensate for the loss of the right to strike which would be involved during what happened in this period. There is nothing sinister in it, it is just a little catch-up compensation provision that operates in very limited circumstances and I do not know whether it has ever operated in practice at all. One could say it is hardly worth making a federal case about it, your Honour, but that is just what we seem to be doing.

One difficulty about this section is that we have said so much about it that really it is only a small part of the matters in issue in this case and we would not want the fact that there have been so many arguments addressed to distort the fact that it just concerns a residual part of the operation of the Act.

BRENNAN CJ: It is a provision of the Act , the constitutional validity of which has been challenged, Mr Solicitor. We have to consider it.

MR GRIFFITH: That is why we spent so much on it to put the argument, but if the point is this is striking at the heart of the functions of the State, the point is we are dealing with an exceptional situation where one takes several exceptional steps to get to the point where such an award might be produced. We say working in that way, on the face of things, it seems unlikely that this is something that is threatening the capacity and function of the government to function. That is the point I wish to make. That is why we address at it, your Honour. If one has got so far down the by way one might pause and wonder, well, yes this does affect the State, or if we accept Justice Dawson's view, you pay no more in this exceptional case, the question is whether or not that has the requisite seriousness of effect. That is the point we would like to make. We faced up to the validity point on the - I will not say descending order - but on the order of matters that we have addressed.

May I refer now to the issue of severance and reading down which I foreshadowed in my opening on Melbourne Corporation issues. The Commonwealth never likes making submissions about severance because we always approach litigation on the basis that all our legislation is valid.

BRENNAN CJ: You say that every time, Mr Solicitor.

MR GRIFFITH: Your Honour, I would rather not say anything about severance, but my second or third submission was going to be that mostly when there is a little problem such as section 12 of the Native Title Act, the Court has no difficulty in dealing with severance. You just take it out; it does not alter the Act. In here, your Honours, I have not multiplied it up but we do have, in effect, four different claims made against its validity, the invalidity. The fourth claim which I call New South Wales allegations against 7A works into severance anyway if that arises on one view. We have, in effect, claims going against three heads of power and three immunities with various subsets and three different States approaching sometimes the same provisions with different argument; sometimes different provisions that others do not seem to be prepared to attack.

Your Honours, our basic submission is that if we get beyond just a simple obvious case of severance where some things might be declared invalid and, when suitably read down, et cetera, it is still invalid and there is any difficulty - this is so complicated - our submission: it would be best for the Court to summons us back again and to hear argument on severance rather than for us to predict appropriate submissions now as to how you would deal with it. So that is one submission we desire to make. If severance gets difficult, we submit, your Honours, the Court should list the matter for argument or propose to have written submissions.

BRENNAN CJ: Before you proceed any further then, Mr Solicitor, I might inquire of the Bar table whether there is any concurrence in the view that you have just submitted.

MR GRAHAM: If the Court pleases, perhaps two propositions were put: one for relisting and one for written submissions. We would, I believe, prefer relisting rather than written submissions, but I do not oppose either course in principle.

MR SELWAY: If it please the Court, my learned friend the Solicitor for the Commonwealth has a distinct point. The difficulties and the permutations that might arise, depending on the Court's approach to the issues, are such that it would be convenient, I think, for a severance argument to take place in due course if the Court thinks that it is necessary. So far as South Australia is concerned, we would be prepared to do so in writing but, if the Court and the other parties wished it to be by oral submissions, we would have no objection to that.

MR COCK: We would concur, with respect, with the previous comments by the Solicitor for South Australia.

BRENNAN CJ: Thank you. Mr Solicitor for New South Wales, does this really concern you?

MR MASON: We just ask the Court to sever 7A.

BRENNAN CJ: Mr Solicitor, in the light of the views expressed at the bar table, the practical course seems to be not now to consider the question of severance, but the Court will consider, if that problem should arise, whether the matter will be either relisted for hearing or whether further written submissions will be sought and will be regarded by the Court as sufficient.

MR GRIFFITH: Your Honour, I did not intend my submissions to let the Court not decide easy issues of severance, like 7A. If the Court were to determine 7A was invalid - - -

BRENNAN CJ: Leave 7A to one side.

MR GRIFFITH: Well, that is just an example, your Honour, but my submissions are intended to go to complicated severance. If it is a straightforward one, well, we would not ask the Court to convene, but if it were complicated then, almost by definition, your Honour, we would have thought that at least some of the protagonists would wish to make oral submissions on it.

BRENNAN CJ: Well, that will be better appreciated by us when we know what the problem is, Mr Solicitor.

MR GRIFFITH: If the Court pleases. I was just saying that with the assent of my learned friend, your Honour, so blame him too. Well, unfortunately, that does not mean that I sit down on severance, if the Court pleases, because in talking about severance, we are really talking about reading, not even reading down. I want to talk about reading first and then reading down and then the Acts Interpretation Act and then I have to deal with 7A because of the validity point that has been raised.

BRENNAN CJ: Well, perhaps 7A could be dealt with as a distinct problem if you wish to deal with that.

MR GRIFFITH: Well, I was going to do it last, your Honour, because it fits in last - may I do that - because, at the moment, your Honour, I am not on severance, I am on reading the words to say that they are valid. I have not got to the point where there is anything to sever or read down yet. Can I go that far?

BRENNAN CJ: Yes.

MR GRIFFITH: Well, your Honour, we have identified aspects where one has to, one might say, read carefully, and they are in paragraphs 6.8, 6.1, 6.26 and 6.29 dealing with the Melbourne Corporation principle being infringed if Divisions 1, 2 and 3 and 5 of Part VIA were read to apply to State government employees at the higher levels of government. Now, we still do not know. I suppose we will wait for reply from Mr Young on that as to whether or not anyone is contending that one would naturally not read these provisions as applying to those State government employees at the higher level of government.

We say that the Court should not adopt that view and that it really will be inappropriate, your Honour, if all this case ends up about on these issues of validity is whether it is necessary to make these provisions valid to have a one line section introduced into the Act saying none of these divisions apply to State government employees at the higher level of government. We concede that they do not and we submit, your Honours, it is really a matter of futile inquiry to construct a meaning that on the face they do when there is no reason whatsoever to construe the provisions as applying to those persons. But it may be if that is a position of the plaintiffs the Court should go through the exercise.

But, your Honour, we do note that the operative parts of Division 1 and 2 of Part VIA do no more than confer powers on the Commission to make orders, so until the Commission reports and makes an order applying to State government employees at the higher levels of government, there is no question of inconsistency to the constitutional prohibition. If the Commission were ever to seek to make orders applying to State government employees at these higher levels of government, well then the issue of constitutional validity could be raised in the usual way, but one must assume that the Commission would not, having read and reread the Australian Education Union Case, for a moment contemplate exercising its powers in a constitutionally impermissible way. So that, we submit, your Honour, that, as in the Australian Education Union Case, the State Union Case, there is no difficulty in respect to Divisions 1 and 2.

Now Division 3, sections 170DB to 170DG, and Division 4 confer obligations directly on employers. As to those, we submit, that these divisions do not by their terms extend to State government employees at the higher levels of government. We refer to paragraph 6.7 and also 6.16, 6.26 and 6.29 of our submissions. If they do so extend to State employees, contrary to our submission, in order to ensure the validity consistent with subsequent decisions of the Education Union Case provisions would need to be read so as not to apply to such employees. Now, on that issue of reading - this is not reading down the extent of applying section 15A of the Acts Interpretation Act. We submit that these provisions can be so read as not including State employees at the higher levels and.....with the general principles of construction in respect of constitutional issues of this sort. We say there is no need to rely on section 15A; we do not have to call in section 7A.

So, your Honours, our submission is that this is analogous to matters which have previously been determined by the Court as long ago as D'Emden v Pedder [1904] HCA 1; (1904) 1 CLR 91. There the Court remembers that the State legislation imposing a stamp duty on receipts could not constitutionally apply to a receipt given by a federal officer for his or her salary. However the Court held that Tasmanian legislation imposing a stamp duty on receipts generally was valid and of course the generality of the language used had to be interpreted so as not applying to receipts given by a federal officer for salary. And that was a sensible result, in our submission.

Now, in our submission, some 91 years later, the present case is merely the converse; you have got Commonwealth rather than State law, the laws of general application. It would be invalid, we now know by reason of the decision of this Court made subsequent to the enactment of the law, that it would be invalid in so far as a generality of the wording could be capable of extending to one specific class of employer/employee relationships, namely the relationship between State governments as employers and the employees at the higher levels of government because of a decision of the Court made in April this year, it has become common ground that the law cannot so extend. We say it is just as simple as the Court sensibly did, in the very origins of this Court's exercise of jurisdiction, to say this legislation should not be interpreted as so extending. Is it a useful function, we would submit, for the Court to require Parliament to pass a one-line amendment to do that which is now common ground, as being the received valid operation of this law, which will be a matter of form and complication rather than vindicating any issue of constitutional importance between the parties?

This principle of D'Emden v Pedder which we see, in our submission, is not really reading down; it is not giving the statute a narrow effect than originally intended, it is merely applying a principle to say, "What application did you intend to have to this?". We say in D'Emden v Pedder at page 120 the Court indicated that it was applying a presumption of statutory interpretation; a bit like the presumption that legislation does not have extra territorial operation. It was not a presumption saying it did not bind the Commonwealth, it was one saying, "Of course, we construe it as not applying to Commonwealth employees because the Court has just held that there is no power to do so". The Court said at page 120:

we should not, we think, be justified in assuming that the Tasmanian Parliament intended the general words of their enactment to have an application which would conflict with the Constitution of the Commonwealth.

We submit this is a very sensible approach. This approach has been recognised by the Court in other cases - Federal Commissioner of Taxation v Munro [1926] HCA 58; (1926) 38 CLR 153. At 180 Justice Isaacs said:

There is always an initial presumption that Parliament did not intend to pass beyond constitutional bounds. If the language of a statute is not so intractable as to be incapable of being consistent with this presumption, the presumption should prevail.

This part of the judgment was specifically approved by the Judicial Committee on appeal reported under another name at 44 CLR 530, at 545. We refer also the Pharmaceutical Benefits Case[1945] HCA 30; , (1945) 71 CLR 237, at 267, Justice Dixon:

In discharging our duty of passing upon the validity of an enactment, we should make every reasonable intendment in its favour. We should give to the powers conferred upon the Parliament as ample an application as the expressed intention and the recognized implications of the constitution will allow. We should interpret the enactment, so far as its language permits, so as to bring it within the application of those powers and we should not, unless the intention is clear, read it as exceeding them.

Chief Justice Mason in Lim 176 CLR 1, at page 14 made similar observations and, in that particular passage which I will not read to the Court, he recalled earlier decisions of the Court to the same effect.

This submission here, of course, is a general one to be made on the issue of validity, but on this aspect here, we say it goes to reinforce what we see as the sensible approach adopted by the Court as long ago as D'Emden v Pedder.

If this Act had been passed after the April judgment, assuming there were no sections saying this Act was intended only to apply to other than those at the senior levels of State government - the higher levels of government - even without that provision it would be a matter of obvious inference that Parliament, being aware of the constitutional limitation, would intend to have no operation in that area. In our submission, it is a sensible and appropriate construction, given that this revelation has only come since the enactment, nonetheless, as in D'Emden v Pedder to construe it in that way. Otherwise, on an issue where there is absolutely no disagreement as to reach between the Commonwealth, any of the States, and one would suppose any of those involved in the administration operation of this Act, there will be a formal requirement for amendment to meet a difficulty which seems to be common agreement, one which, in practice and operation, cannot have any affect because it is common ground that there is no constitutional reach. It is just a matter of the Court reflecting in its construction of these terms what we submit should naturally be regarded as implicit there.

Now, in that context - and we notice in D'Emden v Pedder that assistance was not required external to general principle - we would submit that it is possible for section 15A, if necessary, to be called in aid to give this necessary limitation. There is no issue of acting in a way which is prohibited by any statement of the Chief Justice in Pidoto. It is merely a matter of confirming what is clear and common ground that there is a restriction in operation in these two divisions, Divisions 3 and 4 in particular, to exclude employees at the higher levels of government. As I have indicated, Division 1 and 2, there seems no problem, but there is no difficulty in including them within that issue of construction.

So, that is our submission on the general issue of the higher levels of government and also it is our submission on general issues of approach to reading the Act so as not to be beyond constitutional power. Our primary submission, apart from this issue of higher levels of government, of course, is that each of the challenged provisions are effect, but in the circumstance of the Court's indication that it would leave issues of severance to be later argued, the only other outstanding issue is the question of section 7A. Now, on one view section A is a severance provision so that the Court could determine to leave the issue of 7A to be determined in the event that it was necessary to have argument as to severance or, alternatively, seeing my learned friend the Solicitor-General for New South Wales, has, as he is entitled to, raised the issue of its validity, the Court could regard itself as being assisted now if I did make submissions as to validity. Could I just say one thing before the Court rules on that?

BRENNAN CJ: Yes, Mr Solicitor.

MR GRIFFITH: And that is that it is not our submission that section 7A has any particular work here on any issue of severance and reading down that we see arising.

BRENNAN CJ: No, we understood that from what you said earlier. But, it would nonetheless be desirable for you to put whatever argument you wish on section 7.

MR GRIFFITH: Thank you, your Honour, I am pleased to do that. Now, I direct myself entirely to the question of the validity of section 7A and not worrying about the issue in Wagner which meant that, although it was pleaded before the Court - perhaps if I can take as read the exchanges between counsel and members of the Court in the argument on that occasion. I think we are all familiar with what then occurred. Section 7A seems to have become fashionable; I did not realise how fashionable. There is an equivalent in the Fisheries Management Act , section 9A; Native Titles Act 1990 , section 208; Customs Act 1901 , section 4AA; Excise Act 1901 , section 4AAA; Moomba-Sydney Pipeline System Sale Act, 1994, section 70 and the Tobacco Advertising - - -

BRENNAN CJ: Is this delivered in terrorem, Mr Solicitor?

MR GRIFFITH: No, your Honour, that is just for the edification of the Court, sort of another Brandy point, I suppose, if I could say that. Section 4A and all we have had so far is the argument and the observations of several members of the Court in Wagner which I will not take the Court to, to those citations. The question is: does 7A differ from general constitutional principles of reading down and from section 15A and in doing so, does it make an impermissible extension of the principles of reading down in cases where there is a capacity to operate in areas beyond power? I have made the point that we say generally there will be very little work for section 7A to do and rarely will it add anything. But, the point made against us is it cannot do anything at all because it is invalid because it is in conflict of what is plainly said in Pidoto. We submit that one can make propositions as to what section 7A is not intended to do and we would hope also what it does not do.

The first is, we submit, it does not do that which is stated by Chief Justice Latham in Pidoto 68 CLR 108, 109, as not being permissible. There the Chief Justice gave a hypothetical example of:

a general statute dealing with larceny which, according to its terms, is plainly beyond Commonwealth legislative power because the Parliament has no power to make general criminal laws.

He said that it was not the effect of section 15A that the statute had to be held valid in relation to all larcenies in the Territory or in relation to all larcenies by Commonwealth officers and in relation to all larceny in the course of transaction, interstate trade and commence and so on. At page 100 he has considered that such an application of section 15A would:

require the Court to perform a feat which is in essence "legislative and not judicial" -

Sorry, at 109 he said that. And where there was more than one standard which might be applied for the purpose of reading down the law a selection amongst these possibilities would result in the content of the law depending on mere choice by the Court and not based on any principle. His Honour considered that the Acts Interpretation Act did not authorise the Court to adopt such a method of promulgating a law under the guise of ascertaining it. With all this we agree.

However, we would make the observation that the fact that the Court's task of reading down might be difficult or complex does not make it legislative. If the Court is not asked to make choices but merely to work out whether a particular application is invalid and on the basis of section 7A where the Parliament wanted the law to operate without covering that application, we submit there may be a matter of inquiry. The effect of section 15A of the Acts Interpretation Act may have an operation in some way in parallel with that, we submit, of section 7A.

If the Commonwealth Parliament enacted a provision which said no more than "a person shall not commit larceny" and prescribed a penalty, we would submit, just as in Pidoto such a law would not be regarded as valid by operation of section 15A to read it down, neither would it be saved by section 7A. It would not be a reasonable interpretation of 7A that it requires the Court in such a case to determine every conceivable case in which committing larceny might validly be prohibited by Commonwealth law - a task which obviously would be impossible - and section 7A be interpreted as having application in this situation and not in others.

We say it is unnecessary to consider the further constitutionality of the interpretation provision which purported to have an effect such as we say section 7A does not purport to do. If it is read as doing what is prohibited in Pidoto, then it must be regarded as being beyond power. We say the Court would rarely if ever, as was pointed out in argument in Dingjan, be able to decide on the validity of any law where section 7A was invoked and there would be obvious constitutional difficulties in such circumstances. But when one looks at section 7A, what it does purport to do is to provide circumstances where there is a trigger operation under subsection (1).

What subsection (1) says is the fact that a provision would, apart from this section, have an invalid operation, it contemplates certain consequences happening. In that situation, paragraph (1)(a) contemplates a provision which has an identifiable invalid application which would render an otherwise valid provision invalid. So a law which said no more than "a person shall not commit larceny" would not be invalid because it has an identifiable invalid application, but rather because it lacks any identifiable valid application. We say in that case section 7A would not be triggered, that subsection (1) would not be satisfied.

Now, section A is obviously directed to do something that is within power. I mean, whatever is its genesis - and if one might postulate, what is its genesis? I mean, a decision such as Lim's Case might be postulated as not unrelated to it, but wherever its genesis, one cannot suppose that those who are behind drafting it were not aware of the restrictions in Pidoto. I mean, you do not march into the valley of death, except with your eyes shut, I suppose. Sometimes things are overlooked, but we would submit that the Court should not assume that section 7A is a blatant statutory attempt to take on the principle enunciated by the Chief Justice in Pidoto.

It has been repeated and refreshed, as it were, enough by decisions of this Court for one to know that there is not much future in doing that, and I have referred to the Court the fashionable way in which in the last couple of years a section in these terms has come to be used. So one would suppose that there must be something perhaps more subtle but more intended than to just confront Pidoto where does not seem to be any constitutional future, at least not in this Court. Perhaps it would work somewhere else, but it would not work here, but this is where constitutional cases are pleaded.

Now, the kind of provision which section 7A may be regarded as being directed to is one which has a core operation which is identifiably in power but which is expressed in language which is too general, so its operation may extend beyond that core within power to another area which is either beyond power or within a constitutional prohibition. For example, it may have a natural meaning within power, but an absurd operation which is beyond power.

Now, it is perhaps not unkind to look at Lim as a possible example of that. Some members of the Court could construe the provision as only applying in Lim's Case in situations of lawful detention. The majority took the view that, fairly construed, the provision intended to apply to unlawful detention which, obviously and agreeably, was a matter beyond power. That was a matter not contested by the Commonwealth in argument.

Now, we would submit that in that sort of situation, section 7A, quite consistently with what was said in Pidoto, does have some work to do. Just as the minority in Lim were able to construe the section without the assistance of a section 7A, possibly with the assistance of section 15A, but perhaps not requiring that assistance, as only intending to cover the case of lawful detention, so those of the majority who were not able so to construe the section, in our submission, may be assisted by the expression of parliamentary intention which is conveyed by section 7A.

In other words, where they see there is a natural and obvious valid operation within power, there is something that seems to be an absurd operation beyond power to purport to apply to invalid detention when it was plain beyond argument that such provision would be beyond power and not disputed, of course, in the argument before the Court in Lim. In that case, in our submission, it is legitimate for Parliament to say if it seems that a law on its operation - because one can think of an absurd operation, an extreme example, that thereby it goes beyond power, you may take it that our intention is to act sensibly and not to attempt to do something which quite obviously might be expected, us being at least tutored by parliamentary counsel in the aspects of limitations on our constitutional power, it must not be thought for a moment we expect it to do.

I mean, that does not mean that section 7A can be relied upon to rewrite a law down to the edge of constitutional power which is uncertain and no more, so in effect to provide that if there is an area of constitutional uncertainty this law sanctions approach to the very edge to be defined on a case-by-case example by the Court. We submit section 7A does not do that and consistently with Pidoto one sees that it would be very difficult to accept that the Court - - -

BRENNAN CJ: Is that not the very problem by the use of the word "application"? It is not directing itself to the operation of the law but to its application to a set of concrete facts.

MR GRIFFITH: Yes, perhaps I almost have to rely on section 7A to construe section 7A in a way, your Honour, to say, it was intended to do something but not very much - just take another step. I have used the example of the Lim step to say that is all that was in mind, to make sure he did not have to have an amendment to get over the problem of the construction such as was held by the majority in Lim, to let the majority happily join with the minority in result.

BRENNAN CJ: The alternative view is to say that there is intended to do everything that could possibly be done to save any piece of legislation whose validity was in doubt.

MR GRIFFITH: Well, your Honour, with respect, that is the same thing, because Pidoto makes it clear that not all that much is possible. I mean, your Honour, one must accept that, we submit, whatever Parliament intended to do with this, they did not intend to overrule the principle in Pidoto because they had no power to. So that was not what they were aiming at. They were not aiming to do very much, and that is why, when one gets to, we submit, to the issue, well do we rely on section 7A as we will be shown the door, we would say it is only an exceptional case where section 7A will stop us going out the door at that stage. It is a narrow possible operation, but we do suggest the Lim situation as being one. It is to cover the case of the extreme example, and we say here, your Honour, if one otherwise had not got to the point we have submitted in various ways where one does, the obvious example here is one could, if there was no other way of having got to that point to say of course Division 3 and 4 does not intend to cover these higher public servants in the State; why construe it to do that?

It is the extreme example. It is the one that is common ground is excluded from the reach of the arbitration power. We say it merely enables the Court legitimately without legislating itself to say, in effect, of course the Parliament did not intend to do that. We would submit, your Honours, that is not really much different from the situation of saying, as the majority might be assisted in Lim when they got to that point of construction, "Yes, but of course you must assume that Parliament didn't intend to have that application. This just helps us without legislating to exclude the extreme operation - not to rewrite it but to exclude the absurd operation".

So what we say is that section 7A operates in a case where the Act does show - you have to see in the Act by its own terms what is the valid occupation, but we say that you do not ask to conjure up valid applications. The obvious example is where you get to the point that the only thing put against this in Division 3 and 4 is that it has this extra impermissible reach recently elucidated by this Court, which is of course accepted then as limiting the operation of the Act. It is not legislating anything to read the Act as not running into that impermissible area.

Adopting this construction only has the effect of eliminating the requirement that an amending section has to be passed which could say that in one line. We say, your Honours, for the Court to so construe it is not legislating. Indeed, it would in a way be a not useful function to have a vindication of meaning which could be cured by a one-line amendment to the Act which all parties are agreed reflects what is the lawful operation of the Act.

So we say, your Honour, section 7A adds nothing at all to general constitutional principles of reading down. We have made our submissions as to how, even for higher levels of government, one does not even have to get to section 15A, but we do say that there is a capacity in a Lim-like situation to lead to an appropriate result. So it might be that section 7A does have a possibility of application beyond where one would get by section 15A. Perhaps another example is Re Nolan; Ex parte Young [1991] HCA 29; 172 CLR 460 where your Honour the Chief Justice and Justice Toohey said with reference to earlier cases at page 485:

Where a law operates distributively and, on a literal construction, embraces cases which are beyond legislative power, s 15A can restrict its operation to cases which are within power provided certain conditions are met. First, it is necessary that "the law itself indicates a standard or test which may be applied for the purpose of limiting, and thereby preserving the validity of, the law" -

and the second condition which your Honours refer to at page 486 was that:

the reduced form or operation of the Act must result in a `consistent workable and effective body of provisions'.

And it must not have:

a different operation upon or with respect to such persons and things -

to which a reduced form of the enactment applies.

We submit, your Honour, that the second edition is largely reflected in section 7A(2). In substance, that is what is intended to be done. It must be taken, your Honour, that those responsible for this section - and it has been enacted by Parliament - intended to do something in conformity with the principles of severance and reading down and the operation of section 15A which had been determined by this Court. It is not an intention to confront the Court; it is an intention to assist and we say, your Honour in this obvious example, it is obvious assistance to say it must be clear beyond argument that Parliament would not intend to cover these State employees in the higher levels of employment. It assists the Court to have an expression in this Act, not even just a general Acts Interpretation Act to say that that its desire. It is quite clear, one could say, even within the terms of your Honour's remarks in Nolan, the law itself indicates a stand or test. If one which is the law itself, the law itself in the context of what is plain constitutional principle of limited reach - that is a little gloss on the remarks - but in a plain situation like that, it may be that section 7A does have some assistance. There could be cases where section 7A could do some work where the Acts Interpretation Act could not apply because this first condition referred to by your Honours was not satisfied.

What if a law was expressed in general terms for the purpose of giving effect to Australia's obligations under international conventions and the Court was satisfied that, in general, the provisions of the legislation are reasonably capable of being considered appropriate and adapted to giving effect to the provisions of the treaty? But suppose one could hypothesise certain unusual situations which may fall within the terms of the legislation which the application of the legislation could not reasonably be considered appropriate and adapted to give effect to the treaty.

In that case it may be the law will be found to exceed the legislative power, but we say that it is possible there that section 15A could not applied because there is no obvious standard or test, but what section 7A does is to say, "Well, so long as the Court accepts that it's within the aspect of the exercise of judicial power and is not exercising the power of legislation, it is legitimate for the Court to have regard to the obvious limitation of constitutional power", and that would enable the Court to hold that in that operation, on so reading the provision, it operated within power.

In such a case, the Court would not be exercising legislative function, of choosing what the content of the law is and selecting one of several possible standards or tests. The Court would not be called upon to decide whether or not a legal rule should apply in situations of type X. The Court would be exercising judicial functions applying a legal rule to specific facts. The question for the Court would be whether the application of a legislation to situation X would be appropriate and adapt it to give effect to the provisions of convention Y.

In those circumstances, we submit that section 7A may be of assistance to the Court without dictating that the Court at all should consider exercising any legislative functions. So that section 7A applies only, we would suppose, to a case where there is valid application and where the core operation of the law is obviously within an identified legislative power, but where the language used is a little too broad, so the operation extends beyond the limits of that power.

So section 7A merely, we would say, would trim off the edges. You do not have to look for legislative powers to support the law as the Chief Justice suggested in Pidoto, rather it is Parliament which selects the legislative power and the Court is merely directed not to apply the law in circumstances where this would not be justified. I appreciate there is a lot of fine distinctions made in those submissions, your Honours, and our principal submission remains all this is merely addressed to the issue of validity should section 7A itself be struck down as beyond power, or is it a section for another day which may be found to have constitutionally permissible work, albeit of a very limited character.

The last question for the Court, we would submit on this issue, is whether it is necessary for the Court to address section 7A at all, bearing in mind the various alternative submissions we make as to why the legislation should not apply to that area. If the Court pleases, the remainder of our submissions are confined to the areas of parental leave and strikes and those minor matters where I would expect Mr Burmester to be about 40 minutes or so.

BRENNAN CJ: Yes, we will adjourn now until 10 o'clock tomorrow morning.

TOOHEY J: Mr Solicitor, just before we do adjourn, you might be helped in your researches into paid rates if you have a look at the decision of the Commission. It is re Aluminium Industry Award 56 IR 403, handed down on 8 December 1994. It is actually among the material provided by Western Australia.

MR GRIFFITH: Thank you, your Honour.

TOOHEY J: Well, you may not thank me when you read it. I am not sure that you will get a lot of joy from it.

MR GRIFFITH: I do no know whether your Honour invites me to say I have concluded my part of my submissions or not. Your Honour, one difficulty is that one does not know whether you just take the operation of the award from the face of the terms of the award.

TOOHEY J: No, but I simply mention it because there is a discussion of the concept of paid rates.

MR GRIFFITH: Thank you, your Honour.

AT 4.27 PM THE MATTER WAS ADJOURNED

UNTIL FRIDAY, 8 SEPTEMBER 1995