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High Court of Australia Transcripts |
Office of the Registry
Sydney No S7 of 1995
B e t w e e n -
GIANCARLO GAMBOTTO
Applicant
and
RESOLUTE SAMANTHA LIMITED
Respondent
Office of the Registry
Sydney No S12 of 1995
B e t w e e n -
GIANCARLO GAMBOTTO
First Applicant
GIANCARLO GAMBOTTO as Trustee for GIANLUCA GAMBOTTO, ALESSANDRO GAMBOTTO and ANTONELLA GAMBOTTO
Second Applicant
ELIANA SANDRI
Third Applicant
and
BEACH PETROLEUM N.L.
Defendant
GUMMOW J
TRANSCRIPT OF PROCEEDINGS
AT SYDNEY ON MONDAY, 18 SEPTEMBER 1995, AT 10.20 AM
Copyright in the High Court of Australia
MR G. GAMBOTTO: If it please your Honour, I appear on my own as an unrepresented plaintiff.
HIS HONOUR: You have a number of opponents by the look of it.
MR GAMBOTTO: Yes, I was surprised to see.
HIS HONOUR: Who else appears in the first matter?
MR J.D. HEYDON, QC: I appear with MR I.M. JACKMAN and MR M. LEEMING for the defendant. (instructed by Blake Dawson Waldron)
MR G. GRIFFITH, QC, Solicitor-General for the Commonwealth: I appear with my learned friend, MR S. GAGELER, intervening in each matter for the Attorney-General on the constitutional issue. (instructed by the Australian Government Solicitor)
MR R.J. WEBB: I appear for the defendant in the second matter, your Honour. (instructed by Piper Alderman)
HIS HONOUR: Yes, Mr Gambotto.
MR HEYDON: Your Honour, before Mr Gambotto commences could I just inform the Court and seek to file in Court or tender a certificate of registration on change of name and change of status. The point is that the former name of the defendant in the first matter, which was Samantha Gold N.L. has now been changed to Resolute Samantha Limited.
HIS HONOUR: Show that to Mr Gambotto.
MR GAMBOTTO: I accept.
HIS HONOUR: The certificate of registration of change of name and change of status in respect of the respondent in the first matter will be exhibit A in that matter.
EXHIBIT: Exhibit A Certificate of Registration on change
of name and change of status
HIS HONOUR: There is no opposition to the change of name going on the record?
MR GAMBOTTO: Not at all, your Honour.
HIS HONOUR: The title of the respondent in the first matter, I order, should be changed so that it is "Resolute Samantha Limited".
MR HEYDON: If the Court pleases.
HIS HONOUR: Directions were given for these matters to be heard together and for written submissions to be filed. That has happened, I take it?
MR HEYDON: Yes, your Honour.
HIS HONOUR: And submissions also from the intervener have been forthcoming as well, I think.
MR GRIFFITH: Yes, your Honour, we filed this morning. We do have a short legislative history. Perhaps I could hand that to your Honour. It has been distributed along the bar table.
HIS HONOUR: Yes. You have a copy of this, Mr Gambotto?
MR GAMBOTTO: Yes, your Honour.
HIS HONOUR: I do not think I need mark it; I will just receive it.
MR GRIFFITH: No, your Honour.
HIS HONOUR: What I propose to do would be to look at the pleadings in the first matter, which I think supply all the facts; the pleadings in the second matter, and then I will take any other evidence, if there is any. I suspect there is probably not, and then I will take the addresses. Is there any agreement about the order of presentation of addresses?
MR HEYDON: There has been no discussion about it. We have been presuming Mr Gambotto would go first, we would follow.
HIS HONOUR: That would be the ordinary way.
MR GAMBOTTO: Thank you, your Honour.
HIS HONOUR: And then you will have a reply. Now, the writ of summons had the statement of claim appended to it and there is a statement of defence. Was there any reply?
MR HEYDON: No, your Honour, there has been no reply.
HIS HONOUR: That seems to present the issues. Is there any further evidence in Samantha?
MR GAMBOTTO: Not on my side, your Honour.
MR HEYDON: Nothing to add, your Honour.
HIS HONOUR: In the Beach matter there is an amended statement of claim, that is right, is it not?
MR WEBB: That is so, your Honour.
HIS HONOUR: But not in the other matter?
MR HEYDON: That is so, your Honour.
HIS HONOUR: Yes, that seems to raise the issues as well with the form of the defence. Is there any further evidence in the Beach matter? Is that the same as Samantha?
MR GAMBOTTO: No further matter.
HIS HONOUR: Yes, Mr Gambotto. I read your written submissions when they came in. Is there anything you want to say now to supplement them?
MR GAMBOTTO: First of all, your Honour, if I may at this time, if it is appropriate, I would like to tender a copy of my naturalisation certificate. The reason why - - -
HIS HONOUR: I asked you whether there was any further evidence and you said no.
MR GAMBOTTO: I see. It relates to submissions; it does not relate to evidence, your Honour.
HIS HONOUR: What is it relevant to?
MR GAMBOTTO: It is relevant to my reply to the submissions, especially those on the part of Beach.
HIS HONOUR: In what way?
MR GAMBOTTO: In the way that rather than being born in this country and acquiring at birth all the rights and duties of a citizen of this country, I became a citizen of this country by naturalisation. Therefore I received a naturalisation certificate which I took to describe the contract I had entered between myself and the country and between the country and myself. As such it says things that have a bearing on my submissions in so far as nowhere in the certificate of naturalisation is there a mention of Constitution. Now, true enough it does in one part state that I swear allegiance to Her Majesty Queen Elizabeth II, her heirs and successors, and swears too or affirms that he will observe faithfully the laws of Australia and fulfil its duties as an Australian citizen and become entitled to - - -
HIS HONOUR: The Constitution is the supreme law, Mr Gambotto.
MR GAMBOTTO: Exactly. This is part of my submission. However, and therefore if one relied on my submission, one would not have to look at this document at all because that is what I am saying - I am contending to the Court the Constitution is the supreme law of this country and I am well aware of that.
HIS HONOUR: I do not need to be persuaded about that. I do not think anyone here needs to be persuaded about that.
MR GAMBOTTO: The point that I am trying to make, your Honour, is this, that it is alleged in the submissions of Beach especially - - -
HIS HONOUR: Whereabouts?
MR GAMBOTTO: - - -and also I find - - -
HIS HONOUR: Let us take it step by step. Whereabouts in the Beach submissions do you complain?
MR GAMBOTTO: I think it is the last part of the submissions where a number of issues are raised in so far as saying that the present Corporations Law as it stands relates back to State laws which were in existence before - - -
HIS HONOUR: Just take me to the paragraph, Mr Gambotto. You have got to do things specifically. That is why we are here. We cannot talk at large.
MR GAMBOTTO: Your Honour will have to - - -
HIS HONOUR: Take your time to find it.
MR GAMBOTTO: See, for instance, submission 28 at page 7:
The Corporations Law of Western Australia is a law operating under the authority of the Western Australian Parliament.
HIS HONOUR: Whose submissions are these?
MR GAMBOTTO: The Beach submissions. The Blake Dawson Waldron submission, I am sorry. I apologise to your Honour.
HIS HONOUR: That is Mr Heydon's submission, is it?
HIS HONOUR: Yes.
HIS HONOUR: Paragraph 28.
MR GAMBOTTO: Page 7, point 28. From 27 onwards, even earlier actually, it directs our attention to the fact that the Corporations Law is a uniform law that arose from a number of laws that the State had prior to it and actually this morning when I was handed in the latest history of section 701 by the Attorney-General for the Commonwealth it explains it in great detail and therefore I take it that the inference that is put to me is that since 1928 we are facing everywhere in Australia, or the States of Australia - - -
HIS HONOUR: Since 1928?
MR GAMBOTTO: Yes. If your Honour refers to page 2 of the Commonwealth submission - since 1929, I am sorry, I made a little mistake there. We have had a number of laws - - -
HIS HONOUR: He is talking about a law of the United Kingdom there. He is talking about the 1929 UK Companies Act.
MR GAMBOTTO: Yes. Then in New South Wales the Companies Act 1989 of 1936, section 135 commence on 1 January 1937 and so forth and so on. What I am saying to your Honour is that I take it that the inference that is being put to me - and I may well be wrong procedurally and I beg your Honour's indulgence if I am - what is being put to me is that "Who are you", being said to me, "to come before the highest Court in the land and allege certain things about the law that has been in existence for donkey's years".
HIS HONOUR: I do not think that is being put. You seek to respond to that by your naturalisation certificate?
MR GAMBOTTO: Exactly. I seek to respond to it in the way that the Constitution goes back to 1901, your Honour.
HIS HONOUR: I follow. My Heydon, you are the source of this problem.
MR HEYDON: We do not challenge Mr Gambotto's standing. We submit the naturalisation certificate is irrelevant.
HIS HONOUR: Yes, I do not think there is any complaint about that at all, Mr Gambotto.
MR GAMBOTTO: Thank you, your Honour. I am sorry for raising the point.
HIS HONOUR: No, I understand, but there is no problem. What about the substance of the matter?
MR GAMBOTTO: Your Honour is dealing with an unrepresented person and will have to extend me some indulgence, as I said before. I take it that it is up to me now at this point in the proceedings to reply - - -
HIS HONOUR: No, I am asking you to explain any more you want to say to supplement what you said in your written submissions. Then I will ask the other side and then you will reply to what they have said, you see.
MR GAMBOTTO: It was a misunderstanding on my part. I sit down and shut up.
HIS HONOUR: You have the chance of two opportunities, that is all I am saying to you. This is the first one.
MR GAMBOTTO: Thank you, your Honour.
HIS HONOUR: Yes, Mr Heydon.
MR HEYDON: The points we wish to make have been made in our written submissions, which is an eight page document dated 11 September. Does your Honour have that?
HIS HONOUR: Yes, I do.
MR HEYDON: Might I respectfully inquire if your Honour has had the opportunity to look through it?
HIS HONOUR: Yes, I have. I am not sure I have fully digested it, though.
MR HEYDON: Can I perhaps address it briefly or speak to it briefly. With respect to the plaintiff's written submissions, not all of them seem to be strictly germane, but we - - -
HIS HONOUR: Mr Gambotto mentioned Magna Carta. Just explain to me, and therefore to him, what you say about that in this sort of case.
MR HEYDON: What I make of his reference to Magna Carta?
HIS HONOUR: Yes. You say it is legally irrelevant, in effect.
MR HEYDON: Yes, we do.
HIS HONOUR: Why do you say that is so?
MR HEYDON: He puts, as we understand it, two essential arguments: one based on section 92 and perhaps there are two arguments that he puts under that rubric; and he puts another argument in relation to an implied right to continue property ownership, no matter how just or unjust the terms of the acquisition of that property are. We do not apprehend that anything that flows from Magna Carta can strengthen his or weaken our position in relation to those two questions or three questions.
HIS HONOUR: No. I am just seeking to pick up the passage. It was buried in here. Maybe it was in some other document.
MR HEYDON: Our collective recollection is that it is not in these written submissions athough it has appeared in other communications.
HIS HONOUR: Yes, all right, then we do not need to deal with it then.
MR HEYDON: Our short position is really this: so far as the argument turns on burdens on interstate trade and commerce, we submit that the law laid down in Cole v Whitfield and never departed from in the seven years since it was laid down calls for a search for a discrimination between interstate and intrastate trade by imposing discriminatory burdens of a protectionist type and that section 701 does not do that. There is no further point - - -
HIS HONOUR: Could you take me through section 701, please?
MR HEYDON: Yes. Does your Honour have a copy of the Corporations Law?
HIS HONOUR: Yes.
MR HEYDON: Section 701(1) is essentially definitional. The substantive provisions commence at subsection (2) and they say that:
Where:
(a) takeover offers have been made under a full takeover scheme.....
(b) during the takeover period the number of shares in that class to which the offeror is entitled has become not less than 90% -
Pausing there, your Honour will remember from an admission in the defence of the correctness of paragraph 4 that Samantha invoked the compulsory acquisitions of the law and notified the plaintiff that it would proceed with the compulsory acquisition of the plaintiff's shares. That is a reference to the notice which is mentioned at the end of subsection (2), namely a notice "before the end of 2 months after the end of the offer period.....to a dissenting offeree", which included Mr Gambotto, of a desire for the offeror to acquire the outstanding shares.
Subsection (3) I think can be skipped over. Subsection (4) obliges the offeror to lodge a copy of the notice. Subsections (5) and (6) are not matters raised at all in the plaintiff's written submissions, nor in his pleading, and can be put on one side. But what they do is this: subsection (5) means that once the notice has been given the offeror becomes not only entitled but bound to acquire the shares to which the notice relates on the terms that were applicable in relation to the acquisition of shares under the takeover scheme or the takeover announcement, that is to say the minority, he gets the same terms as the other persons to whom the offers were made and some of whom, presumably, accepted them.
Subsection (6) prevents subsection (5) applying where an application is made to the court. The court is the Federal Court or the Supreme Court of Western Australia, it being a Western Australian company or any other jurisdiction exercising Western Australian jurisdiction and in effect it provides for a system of review by the court as to the merits of the offer that has been made. But no application, as far as one knows, was ever made - - -
HIS HONOUR: Just pardon me one moment, Mr Heydon. It is agreed, is it, that - I am not sure it comes off the pleadings, but it is the fact, and there is no dispute about it, that your client is incorporated in the State of Western Australia?
MR HEYDON: It is the fact. As to whether there is a dispute about it - - -
HIS HONOUR: It appears, as my associate reminds me, sufficiently from exhibit A anyway.
MR HEYDON: Yes, it does appear from exhibit A.
HIS HONOUR: What about your client, Mr Webb?
MR WEBB: Your Honour, I have indicated in our submissions that Claremont, the subject of the takeover, was incorporated in Queensland and Beach in South Australia, although there is no pleading or admission on the pleadings about that matter.
HIS HONOUR: I can take those as basic facts, I think.
MR GAMBOTTO: Of course, your Honour. I never alleged otherwise.
HIS HONOUR: Yes, Mr Heydon.
MR HEYDON: I think that subsections (5) and (6), apart from being noted as part of the structure of the section, are not relevant directly in the proceedings. Subsection (7) deals with the question of where alternative terms were offered and gives the dissenting offeree a aright, as it were, to indicate which of the sets of terms the dissenting offeree prefers. Subsection (8) is consequential on subsection (7). I think the next provision to look at is subsection (10). That deals with what happens in the case where there has been no application to the court under subsection (6) and where there has been no contrary order of the court under subsection (6). It says that:
the offeror shall, before the end of 14 days after -
three possible dates:
serve a copy of the notice under subsection (2)on the company that issued the shares, together with an instrument of transfer of the shares signed on behalf of the holder of the shares.....and pay, allot or transfer to the target company the consideration for the transfer, and the target company shall thereupon register the offeror as the holder of those shares.
(11) The target company shall hold the consideration so received in trust for the former holder of the shares -
so transposing that to the facts of this case, there is no evidence about this but what has happened has been that subsection (10) was put in play, the appropriate consideration was given to the target company which is either holding it on trust for the plaintiff or has handed it over to the plaintiff. I am not sure which is which.
I should say this: your Honour has observed that the admissions made in the defence and the facts which are therefore before the Court, are sufficient to throw up the points which the plaintiff wishes to throw up, but I do not want the Court to be left with any misleading impression that events have, as it were, been frozen as they are described in the statement of claim, namely, frozen as at 16 December 1994 in paragraph 4. Things have moved on since then and - - -
HIS HONOUR: That was the subject of some interlocutory applications, I believe.
MR HEYDON: Yes. There were, in effect, two: one in another case and one in this; two unsuccessful applications for interlocutory injunctions and as the law compels, matters have proceeded on so that the plaintiff no longer has his shares in the target company.
HIS HONOUR: No, but if he makes out his case, he would be able to unravel it, surely.
MR HEYDON: Yes. May I indicate this your Honour: though no claim for relief is in terms made along those lines, we accept that if the plaintiff succeeded on one or other of his two points, or one or other of his three points, the consequence would be that the acts done in reliance on the void section 701, would be unravelled and he would be restored to the register and there is no difficulty about that. I do not think your Honour is troubled by any question of remedy, in other words.
It might be different if the remedy were a discretionary one but it would not appear to be - - -
HIS HONOUR: Not in the constitutional - - -?
MR HEYDON: It iwould simply be a question of nullity. So that is the general position of 701.
HIS HONOUR: Thank you.
MR HEYDON: While I am on the general structure of 701 and since Mr Gambotto has drawn attention to the Solicitor-General's history, can I just highlight now part of our written argument which seeks to analyse what actually 701 is. It is the area which is paragraph 21 of the written submissions on to paragraph 26. It simply seeks to explain to the Court what your Honour already knows, namely the way in which a section like 701 fits in to the company law of the country generally. The Corporations Act (Cth) was a law which created for the Australian Capital Territory a thing called the Corporations Law as set out in section 82 of that Corporations Act 1989 (Cth). The validity of that would depend on section 122 of the Constitution.
Western Australia, and for that matter all the other polities, enacted a section in legislation of their own which provided that the Corporations Law applied as a law of Western Australia as in force for the time being. In other words, it picked up proleptically any amendments which might be made by the Commonwealth Parliament to the Corporations Law. Then, we have set out various provisions which really try and make the corporations laws of the States and territories work harmoniously together. One is that the Acts Interpretation Act 1901 of the Commonwealth will apply as a law of Western Australia rather than its own domestic or local - - -
HIS HONOUR: Where do you highlight that?
MR HEYDON: Paragraph 23.
HIS HONOUR: I see - 23?
MR HEYDON: Yes. One finds that in section 10 of the Corporations (Western Australia) Act 1901 . Does your Honour have the legislation in the CCH form?
HIS HONOUR: Yes, I do.
MR HEYDON: That, by way of illustration, if one goes to section 10 of the first item of legislation in the volume, one sees there that the Acts Interpretation Act of the Commonwealth as in force at the commencement of section 8 of the Corporations Act 1948 applies as a law of Western Australia in relation to the Corporations Law and the Corporations Regulations of Western Australia. So that there has been, in effect, an exclusion of the State Interpretation Act in the event that it were different and a selection, as the appropriate touchstone of the Commonwealth one.
HIS HONOUR: Yes. I had not appreciated that.
MR HEYDON: So that there is, if you like, from this point of view, all the corporations laws are looking up to the Commonwealth Interpretation Act so as to secure uniform interpretation. Now, that is obviously designed to operate more effectively than, for example, the doctrine that courts in different parts of the country, in dealing with uniform legislation, will follow each other's decisions.
Resuming the analysis, our paragraph 24 refers to 26(a) of the Corporations (Western Australia) Act which provides that the object of Part 8 is to help ensure that the Western Australia Corporations Law and the other corporations laws are administered and enforced on a national basis. Then, in paragraph 25, we refer to various provisions of the legislation of the same kind; 26(b) deals with the administration of the ASC Law in the same way. Section 34 says that:
The object of this Division is to further the object of this Part by providing that the Commonwealth administrative laws:
(a) apply to the applicable provisions of Western Australia; and
(b) apply, in Western Australia, to the applicable provisions of another jurisdiction, as if the applicable provisions were those of the Capital Territory.
One gets similar provisions in sections 40, 42, 46 and 53 so that the aims of the parliaments of the Northern Territory and of the six States have been to conform to the regime laid down for the Australian Capital Territory by a federal statute. Your Honour might ask, "Why is he talking to me like this and why is he going on in this fashion?" It may not matter much for the purpose of the debate, but it is possible that a controversy might occur along these lines: one view would be that the Corporations Law of Western Australia is simply a State law and on that view, we would submit that at least since the very earliest days of federation, there has never been any question about whether State parliaments can expropriate without compensation or - - -
HIS HONOUR: No, and indeed, a referendum that they might be required to give compensation was resoundingly defeated, bizarre as that may seem.
MR HEYDON: Yes. A second possibility is that if the Corporations Law of Western Australia is not, strictly speaking, a State law, but rather a law operating under the authority of the Western Australia Parliament and made, in effect, by adoption by the Western Australia Parliament of the text of the Commonwealth law, an adoption which, as it were, runs the risk or the peril that later on changes might be made by the Commonwealth Parliament to the model which has been picked up and those changes will automatically flow to Western Australia.
HIS HONOUR: That is how the system works, does it not, that the Commonwealth Parliament legislates to make changes and no further State legislation is required.
MR HEYDON: Yes. This obviously flows originally from agreement between the governments of the bodies, but it is an effective method of avoiding people getting out of step as time goes on. If there were to be any getting out of step, it would call for some sort of revolution or, at least, a radical change in course from that which was contemplated in the late 1980s. A third possibility, which cannot be right, is that the law in question is a Commonwealth law. We submit it cannot really be so because the law owes its force in Western Australia to a Western Australian enactment.
We would submit - and here I am drifting really into the implied property right part of the argument - but we would submit that whichever of the possibilities is the case, there cannot be an implied right of the type for which the plaintiff is contending because if the law were treated as a Commonwealth law, you already have an express provision on the subject in section 51(xxxi) which would appear to be just radically inconsistent with an implication of the type relied upon. If, on the other hand, it is either a State law, stricto sensu or a State law in which the State Parliament has adopted the text of a Commonwealth law, it is hard to see how one could imply into the Commonwealth Constitution something which would put the States into a weaker or less powerful position than the Commonwealth Parliament is in under section 51(xxxi). It may be academic precisely what the nature of the law is but we thought it appropriate just to set out the somewhat complex background to it so that the Court has it in, I hope, a clear way before it.
In view of something that fell from your Honour, I suppose it is probably not necessary to add to the citation that appears in paragraph 28 but might I just briefly do it only by reference. If one wants a better authority than some words of Chief Justice Barton in 1915, one could find them in Pye v Renshaw [1951] HCA 8; (1951) 84 CLR 58, at pages 79 to 80 in the joint judgment of Justices Dixon, Williams, Webb, Fullagar and Kitto where their Honours simply said this:
If a State Act provides for the resumption of land on terms which are thought not to be just, that is of no consequence legally: it cannot affect in any way the validity of the Act or of what is done under the Act.
And finally, a recent recognition of that doctrine in this Court which I think the Solicitor-General may be taking the Court to, in Mabo v Queensland (1988) 166 CLR 186.
HIS HONOUR: Is that 166? That cannot be right.
MR HEYDON: Volume 166 CLR; the case commences at 186.
HIS HONOUR: Yes, at?
MR HEYDON: One passage is at 195: that is an expression of agreement by Chief Justice Mason in Justice Wilson's reasons. At 202, Justice Wilson says this in one sentence - - -
HIS HONOUR: This is Mabo [No 1], I guess.
MR HEYDON: Yes, it is.
HIS HONOUR: At 195?
MR HEYDON: At 195, Chief Justice Mason says:
I have read the reasons for judgment prepared by Wilson J. I agree with what his Honour says on the various questions.....except the so-called "inconsistency questions".
What Justice Wilson says on 202, in the middle, just at the end of the long paragraph - - -
HIS HONOUR: Do we have a spare copy for Mr Gambotto?
MR HEYDON: We took the precaution of bringing spare copies of the cases so that the plaintiff could follow such limited references we were going to make to them. The sentence is:
however much its exercise may be deprecated, it is not beyond the power of a State legislature to deprive a person of property without compensation, provided the deprivation is otherwise effected according to law.
The final page to look at is 241, where Justice Dawson, about point 3 on the page says that he agrees with the reasons of Justice Wilson in rejecting certain submissions and one of the submissions, four lines above, was that:
the Queensland legislature did not have power to deprive a person of property rights without compensation -
That, in a nutshell, is our position on the implied property rights. But, could I give the Court one further reference, which is not in our written submissions. It is a reference - and I think your Honour has the volume - to the Australian Capital Television Pty Ltd v The Commonwealth [1992] HCA 45; (1992) 177 CLR 106. It is three or four pages appearing in the reasons for judgment of the Chief Justice, beginning at page 133. On that page, there is a heading near the bottom, "Constitutional implications" and the Chief Justice begins by pointing to the legitimacy of a process of constitutional implications by going back as far as West's Case in 1937 and quoting other passages of Sir Owen Dixon and a passage of Justice Windeyer at about point 2 or point 3 on page 134 - - -
HIS HONOUR: Where should this go in your outline?
MR HEYDON: I suppose it would go, most conveniently in the circumstances, as a new paragraph at the end of paragraph 30 because it is, really, just another recent indication in this Court of the unlikelihood of the plaintiff's present submission being sound. What the Chief Justice is doing on pages 134 and 135 is describing really two types of implication or two processes of implication: one is textual implication - that is to say, where one finds a meaning which is necessary to be implied in the language used and the second of which is structural implication, an implication which can be teased out or found in the overall structure created by the federal Constitution.
The passage that we do place some reliance on is that which begins of 135 under the heading, "The implication of fundamental rights":
The adoption by the framers of the Constitution of the principle of responsible government was perhaps the major reason for their disinclination to incorporate in the Constitution comprehensive guarantees of individual rights. They refused to adopt a counterpart to the Fourteenth Amendment to the Constitution of the United States.
And your Honour will remember that, among the things that the Fourteenth Amendment did after the American Civil War, was to guarantee a right of property, even against the operation of State laws. The Fifth Amendment of the Constitution was held before the Civil War not to guarantee a right of property against the operation of State laws, but only federal laws. The Fourteenth Amendment extended that. Sir Owen Dixon said that the founding fathers:
were not prepared to place fetters upon legislative action, except and in so far as it might be necessary for the purpose of distributing between the States and the central - - -
HIS HONOUR: I thought I had the United States Constitution here; I do not. I am getting a copy fetched; it is easy enough.
MR HEYDON: I hand to the Court a photocopy of the first 14 amendments to the United States Constitution; Mr Gambotto has one; I do not have one and no one else has one, but we will try and accommodate all these needs in due course. Next I think the Solicitor-General deserves to have one. Amendment [V] enacted in 1791:
No person shall be held to answer for a capital, or otherwise infamous crime -
and so forth. Then the third last line in my copy:
nor be deprived of life, liberty or property, without due process of law; nor shall private property be taken for public use, without just compensation.
Before the Civil War, the Supreme Court held that did not, as it were, bind or limit the States. The Fourteenth Amendment, section 1 about the third last line again, said:
nor shall any State deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.
If I can return to Sir Anthony Mason's account of Sir Owen Dixon's views, he says in the fourth line on page 136 of the ACT Television Case that the founding fathers:
were not prepared to place fetters upon legislative action, except and in so far as it might be necessary for the purpose of distributing between the States and the central government the full content of legislative power. The history of their country had not taught them the need of provisions directed to control of the legislature itself.
The framers of the Constitution accepted, in accordance with prevailing English thinking, that the citizen's rights were best left to the protection of the common law in association with the doctrine of parliamentary supremacy.
And there is a quotation from Professor Harrison Moore. Then his Honour says this:
In the light of this well recognized background, it is difficult, if not impossible, to establish a foundation for the implication of general guarantees of fundamental rights and freedoms. To make such an implication would run counter to the prevailing sentiment of the framers that there was no need to incorporate a comprehensive Bill of Rights in order to protect the rights and freedoms of citizens. That sentiment was one of the unexpressed assumptions on which the Constitution was drafted.
The recent bringing to light of either unnoticed or only partially noticed implications in the Constitution does not suggest that the process goes far enough to aid the plaintiff in the present case because the various rights of free speech, whether in relation to contempt or in relation to defamation or in relation to political advertising, are all things which are implied on structural grounds. Even if section 51(xxxi) did not exist, there is no reason to imply on either structural or textual grounds a right of the continued ownership of property. There is even less reason to do so when one does have 51(xxxi) in the Constitution.
I am open to correction on almost any subject, but certainly on this one but, as far as our researches have gone, nothing in the recent decisions has, in any way, qualified or cast doubt on what the Chief Justice said in the Australian Capital Television Case in those passages.
HIS HONOUR: Thank you.
MR HEYDON: That, I think, is all I need to say about the implied right. Can I go back to the two possible ways in which section 92 might apply. I think we indicate on page 2 and refer to the leading cases - - -
HIS HONOUR: Just a minute, page 2?
MR HEYDON: Page 2 of our submissions. At the very top of that page, we just notice the second way in which Mr Gambotto puts the argument about the freedom of interstate intercourse. In paragraph 5 we go to try and deal with his trade and commerce argument and we simply say that there is, here, no discriminatory burden of a protectionist kind. But, perhaps more fundamentally or logically anterior to that point, dropping down to paragraph 8, there is simply no geographical movement or border-crossing involved. It is of no significance that the relevant company is in Western Australia and Mr Gambotto is resident in Sydney. What Mr Gambotto is asking for is that his continued ownership of those shares simply remain in his hands. There is no geographical movement associated with a continuation of that status quo, or what once was that status quo so that section 92 as it is now interpreted, and we would respectfully submit, as it has always been interpreted, would not be of assistance.
As to the freedom of intercourse, different considerations come into play but again, the difficulty in the plaintiff's argument or approach is simply that what is involved here is not interstate in character. Perhaps again, an anterior point which might be made is that it is difficult to describe the continuation of ownership of an asset like some shares as being in any sense intercourse. That seems to imply some sort of flow somewhere but even if there were any flow, it is not flow across State lines which is being burdened by the legislation.
HIS HONOUR: Yes, I see. Paragraph 11 on page 3 deals with the intercourse component of 92.
MR HEYDON: Yes, that is where we deal with the second limb, the intercourse limb of the argument and basically what I have said is a short version of what appears up to paragraph 17. Mr Gambotto's submissions pose a number of challenging questions towards the end and that is what our paragraph 18 deals with. He asks a number of, I suppose they are rhetorical, questions but we have taken the liberty of trying to answer them. On the ninth page of his written outline, he says first:
Could any of us be stopped from transferring to another State or subjected to immigration quotas or other requirements at a State border?
The answer to that question is, "No, we couldn't be unless the legislation in question was defensible as a reasonable regulation". I think the same answer would be given to the third question about being stopped from sending into other States goods, chattels and property, and the fourth, fifth, sixth, seventh and eighth. The questions are either cunningly or accidentally devised so that there does not seem to be any trade or commerce element in them. In other words, we are dealing with the field of intercourse and as I say, those certainly all seem to be instances of intercourse only defensible if there was reasonable regulation. But equally, none of them have any relation whatever to section 701.
That answer cannot be given in relation to the second question:
Could any of us be told by our State Governments that we are no longer citizens of the Commonwealth?
The answer to that question is, "No, we couldn't". The reason why is not because of section 92 but because of section 51(xix) of the Constitution which gives the Commonwealth power in relation to the naturalisation of aliens and, for that matter, the stripping away from citizens of their citizenship. Those are matters on which any Commonwealth legislation would be inconsistent with State law and, therefore, would prevail under section 109 and the Australian Citizenship Act as it is now called would bring about that inconsistency.
The final question that the plaintiff poses is:
Could there be in force prohibitions or qualifications to a resident of one State from acquiring, owning or selling property in another State?
We would say, "No, unless section 117 of the Constitution is complied with". So, although the questions, as it were, excite righteous indignation, there are answers to them which do not call for a construction of section 92 to be made favourable to the plaintiff's submission in relation to section 701. Your Honour, I think those are the submissions we would wish to put, if the Court pleases.
Just to avoid any confusion: the shares which Mr Gambotto once owned, or rather the consideration relating to the shares which Mr Gambotto once owned is currently held in trust for him by the target company so that he does not have the consideration, but it is there if he wants it, which he obviously does not at the moment.
HIS HONOUR: Well, he wants his shares back.
MR HEYDON: He wants his shares back, yes.
HIS HONOUR: Yes, Mr Webb.
MR WEBB: Your Honour, can I just indicate that the same situation pertains in the second matter: that is that, at the moment, the consideration is held on trust by Claremont and is available to Mr Gambotto, subject to the outcome of these proceedings.
Your Honour, we furnished written submissions dated 11 September. I adopt those submissions formally and being a sincere flatterer, also respectfully adopt the submissions of my friend, Mr Heydon. Having looked at his materials and heard what he has to say, I do not think there is any difference in position between us. Having said those two things, your Honour, perhaps if I could just go briefly to my submissions. The only two things - - -
HIS HONOUR: Are there any points that you make which firstly are not made by Mr Heydon or any points you make which contradict the point that he makes?
MR WEBB: None of the latter category. In paragraph 15 of my submissions I refer to a matter of fact that Mr Heydon does not touch upon but which does not really represent a position between us. It is just that in the event that one dissented in this case to considering whether the acquisition had been on just terms within the meaning of section 51(xxxi), one would have to bear in mind that section 701 has been preceded by statutes which have contained equivalent provisions at least since the Companies Acts of 1961. I think I indicated, your Honour, that I would make available, though I do not intend to go to them, the preceding provisions as applying in Queensland, the company of incorporation of the target in this case.
HIS HONOUR: Has Mr Gambotto seen this?
MR WEBB: I do not think he has, your Honour.
MR GAMBOTTO: That is okay.
HIS HONOUR: Where does one find in section 701 the mechanism for the computation of the compensation?
MR WEBB: Your Honour, section 701(2) firstly provides for the notice of acquisition, which is a notification of the desire to acquire.
HIS HONOUR: There is something in here that specifically ties the consideration back to the consideration which - - -
MR WEBB: It is the offered consideration generally made, your Honour, yes.
HIS HONOUR: The offer consideration to everybody else?
MR WEBB: Yes, your Honour.
HIS HONOUR: Where is that actually pinpointed?
MR WEBB: Your Honour, it is section 701(5):
Where a notice is given under subsection (2), the offeror is entitled and bound, subject to this section, to acquire the shares - - -
HIS HONOUR: On the terms?
MR WEBB: On the terms that were applicable.
HIS HONOUR: Yes, I see. Mr Heydon took me to that.
MR WEBB: Then section 701(6) affords the dissenting offeree the opportunity of challenging the appropriateness of that particular consideration. So that in the context of paragraph 15, your Honour, we were just drawing attention to the fact that the Corporations Law of the country has long embodied that sort of provision for the acquisition of shares from minority dissenters.
HIS HONOUR: Is there not some Full Federal Court decision which Sir Maurice Byers argued on the Trade Practices Act?
MR HEYDON: Section 81 - WSGAL. I hand up a copy. It was Justices Lockhart, Beaumont and Hill - WSGAL Pty Ltd v Trade Practices Commission and Others [1994] FCA 1079; (1994) 51 FCR 115.
HIS HONOUR: Give that to Mr Gambotto and I will get 51 FCR. It is slightly different of course, but a related point in a way.
MR HEYDON: Yes.
MR WEBB: The only other point that I would specifically go to - and I do not think that this is something that is put differently or involves a departure from Mr Heydon's submissions - is my analysis of Mr Gambotto's submissions founded on the right of property, whether within 51(xxxi) or implied right. I must say I do not think that, breaking out the content of his submission into the three components that I have attempted there, I have quite captured what I think his submission is. Reading it again this morning, it appears to me that the essence of his submission is that, there being an equality guaranteed by the law, it is necessary that that equality be enforced by a positive discrimination in certain instances so as to make it an equality in fact, as distinct from a mere legal equality and that in the circumstance of section 701, which by its terms makes for a majority acquisition of a minority property interest, it runs counter to what is in fact required, which is a positive discriminatory protection of the minority property interest.
In that case, your Honour, if that is truly an encapsulation of what he says - and it appears to come from page 5 of his submissions at line 24 - then we say that Mr Gambotto is really focusing on a concern of the the Parliament rather than a matter which should concern the Court which is to assure the legal equality and that he is really rather making a submission as to whether in fact the law itself is really for the good government of the people. Your Honour, they are really the only different things which I wanted to say, unless there was something else arising from my submissions.
HIS HONOUR: Thank you, Mr Webb. Mr Solicitor.
MR GRIFFITH: Your Honour, we intervene only on the constitutional point. We would say in passing though, your Honour, it would be our submission that the Western Australian law remains a Western Australian law. We would not agree with the idea that there is a national law that loses its status merely because the Western Australian law, for example, picks up by reference the law of the ACT. It must still be a Western Australian law. That is the terms of the Western Australian law. But we just say that in passing, your Honour.
We have made our constitutional points in our brief submissions which apply to both cases. With respect to our summary of legislative history of section 701, the two pages we handed to your Honour, we would refer particularly to the last sentence of the extract from the Greene Committee Report. Until fairly recently, reform in companies law both in England and Australia is rather prolonged, so that, although the Greene Committee recommended in 1928, it was really to the early sixties before we had uniformity in Australian provisions.
But the function of law of this sort as shown by that extract from the report is to cover really the.....circumstance or, as it is put in that last sentence of the extract, the law:
is in effect an oppression of the majority by a minority -
unless there is a provision to provide for acquisition in these circumstances. So we rely upon that, your Honour, as indicating a characterisation within the ambit of our submission in paragraph 5 on page 3. We say that this is not an acquisition at all; it is merely part of the law relating to corporations. Your Honour's reference to the WSGAL Case is analogous. Your Honour will see particular citations we have there. The analogous there, your Honour, was the divestiture of provisions which were under challenge. We say it is not an acquisitions issue at all and we make our alternative submission if it is, that there is no difficulty about it.
On section 92, your Honour, may we correct a typographical error to paragraph 8, referring to the alternative approach of the members of the Court in Cunliffe, the first alternative refers to "discriminate against intrastate intercourse". "Interstate intercourse" is there intended. Those citations there are of course to the approach of now the present Chief Justice Brennan and Justice Toohey, and then the alternative citations for the alternative approach of others of their Honours is - - -
HIS HONOUR: So it should be "interstate" at both places?
MR GRIFFITH: Yes, your Honour. The second one is correct. The second citation is Justice Deane at 825, Justice Gaudron at 850, Justice McHugh at 852. May we add 836, Justice Dawson. So that is the alternative approach on the intercourse aspect, your Honour. We would submit that there is no possibility of contravention of section 92 for the reasons we summarise. If the Court pleases.
HIS HONOUR: Thank you, Mr Solicitor. Yes, Mr Gambotto.
MR GAMBOTTO: Thank you, your Honour. Would this be a suitable time to adjourn for tea, or does this Court not do that?
HIS HONOUR: I was not proposing to, but if you wish to, tell me and we will.
MR GAMBOTTO: I would wish to, yes, your Honour.
HIS HONOUR: All right, I will adjourn until 11.45.
AT 11.30 AM SHORT ADJOURNMENT
UPON RESUMING AT 11.52 AM:
HIS HONOUR: Before you start, Mr Gambotto, there is a question I wanted to ask the Solicitor-General. What is puzzling me at the moment a bit is this mechanism whereby the States in effect authorise the Commonwealth to legislate on their behalf to amend their own legislation, which is what seems to happen. In other words, the change to the Corporations Law was made by the Commonwealth and was somehow picked up by the States without the States further legislating in the matter.
MR GRIFFITH: Because they already have, your Honour.
HIS HONOUR: The question is: when they already did, is that something in substance amounting to a reference under 51(xxxvii)?
MR GRIFFITH: No, your Honour, we would say not. The State law still operates according to its terms. Just as much as the State law commits the State law to reflect the terms of the Commonwealth law, the State reserves the capacity to cease to do that.
HIS HONOUR: Yes.
MR GRIFFITH: So that in effect, your Honour, the original State law continues to speak as the State law in that subject matter. So one picks up the State law as it now reads and says, "What does this refer to?", and then one goes of course to the current print of the Commonwealth Act, and that is by operation of State law.
HIS HONOUR: Just so that I can be clear, there is no submission about 51(xxxvii)?
MR GRIFFITH: No, your Honour.
HIS HONOUR: Does anyone else want to say anything about 51(xxxvii)?
MR HEYDON: No, your Honour.
MR WEBB: No, your Honour.
HIS HONOUR: Yes, Mr Gambotto.
MR GAMBOTTO: Thank you, your Honour. First of all, I must explain why I decided to bother this honourable Court. Years ago I was reading a book called Barwick written by Mr David Marr. At page 292 the author quotes a quote by Justice Mason in one of the cases before the Court. It related to section 92 of the Constitution.
HIS HONOUR: What was the case; does it say there?
MR GAMBOTTO: The case I think is Permewan Wright v Trewhitt. It does not give the year. Justice Mason in the quote by the author of the book is supposed to have said in that case:
For my own part I see no compelling reason why we should interpret section 92 by reference to doctrines current at the end of the nineteenth century ... the freedom guaranteed by section 92 is not a concept of freedom to be ascertained by reference to the doctrines of political economy which prevailed in 1900 ...
Why I am mentioning this, I am not mentioning it as a precedent, your Honour; I am mentioning it as the springboard upon which I based some constitutional submissions just on 18 months ago that I prepared in reference to a case I had before this honourable Court in Canberra to do with similar circumstances, different in the way that no section 701 had been invoked by the proponent acquirer of my shares, but the - - -
HIS HONOUR: Is this the appeal from the New South Wales Court of Appeal?
MR GAMBOTTO: Exactly, your Honour. Why I am mentioning this is because at the last minute I endeavoured - because of that quote I endeavoured to prepare some submissions, because what that quote says to me, your Honour, is that the Court is at times - and I mean this Court - prepared to listen to submissions that are made which may be contrary or different from statements that have been made by the Court and that have been used as precedents in various matters. Now, why do I mention this, your Honour? Because the submissions that I made to your Honour in this matter a fortnight ago stemmed from the submission that I have prepared 18 months ago.
The Court in its wisdom at that stage did not give me leave to present my submissions. Had it given me such leave, we would not be here today, your Honour, because I would have known right there and then whether my submissions as to the Constitution were valid or otherwise. In other words, I have used all this to explain to your Honour why I am here and excuse my untrained and unrepresented fashion of approaching your Honour regarding the Constitution of this country.
The submission that I prepared on this occasion was served on all the parties, including the Commonwealth, and it was filed with the Court. Your Honour rightly said at the beginning that he had read my submission on receipt or just after. No doubt your Honour would have noted that whereas I could have numbered my paragraphs in the submission, I purposely chose not to.
HIS HONOUR: That does not matter.
MR GAMBOTTO: I am sorry, your Honour. What I mean to say is this, that when I received submissions from the defendant companies, they are all split into paragraphs. I am not talking about the procedure; I am talking about the fact that each paragraph stands on its own merits and refers to some - - -
HIS HONOUR: To some extent.
MR GAMBOTTO: To some extent, and refers to a particular aspect of what is seen by the drafter of the submission as applicable to the point that he is trying to make. What I am saying to your Honour is this: my submission instead was one entire submission. There were for practical purposes a number of premises, and the premises were put under the heading of questions to your Honour. After the questions as a heading, I endeavoured to explain to your Honour my contentions regarding what I was asking your Honour to find out. My contentions were related to the questions and the various questions flowed from each other. In other words, what I am saying is that my submission should have been seen in my eyes as a submission on its own, not as a number of points. The first thing that I noticed is that my submission instead has been taken as signifying three approaches or more to the constitutional angles that I raised.
Your Honour, at this point before I go into any depth in what I stated and try and reply to the submissions from the defendants and from the Commonwealth, I would like to say to your Honour that I have had cause to investigate the system of justice we have in this country. I have ascertained, only recently, mind you, that the system of justice we have in this country is not an inquisitorial system; it is an adversarial system. As such, any matter that is brought before a court, as I understand the adversarial system, is brought based on pleadings by the plaintiff and defence pleadings by the defendant. I have read - and I will not quote where I have read it, but in some of the books that describe the system of laws of this country - I understand that it is not a necessity of the adversarial system of justice to present to your Honour the full facts.
In other words, I may come before your Honour as I see it and allege certain things about a certain incident, but the certain things that I allege about the certain incidentdo not necessarily reflect all the aspects of that certain incident. At the same time, because of the system, the defendant in turn puts in pleadings which are based on my pleadings. In other words, by pleading to the Court on both parts, on both sides, we encapsulate what is given to the Court to decide into a set of parameters. From my understanding, it is rather a difficult thing for any court to do in this country, to go beyond the set of parameters, especially in a civil matter.
Your Honour, what does this create? In my mind it creates a very - I would not call it unsatisfactory because, if I did call it that, I would be offending the system of justice we have, but it creates sort of a laissez-faire position where the truth does not come out all the time and not only because the court is restricted by the parameters to a great extent of the case before it. It decides on the case as presented to the court and it draws assumptions on the facts presented to the court, not necessarily the full truth.
What this does create, in my submission, your Honour, is a set of circumstances where one finds that the courts make decisions from time to time, from case to case. Those decisions, especially in this Court, are binding on all the other courts of the land. In other words, if I may just give a small example, it may very well be that in one of the many precedents quoted by the defendants or even the Commonwealth, the Justices that adjudicated those matters had before them a particular set of circumstances. The comments - and I would like your Honour to appreciate that what I am saying is not said in disrespect; it is said to present my view of what can happen. A Justice presiding at a trial such as the cases that have been quoted as precedents is drawn to make certain comments on the facts before him, not on the whole truth.
One finds that somebody - a Justice I am talking about - may say something which has been used this morning against me or against my submissions, against my pleadings, that could have been based - and for sure it was based - on entirely different circumstances. That is not to detract from the validity of precedent. That is only to point out to your Honour that precedent is not the end of it all, that reason must have its weight in any legal argument before the Court. What leads me to believe that is that very saying by Justice Mason. He had at that stage before him a number of precedents on s92.html"section 92 and he found himself at loggerheads, let us call it, with fellow Justices on the same Bench and he asserted his personal position by saying what he said.
That to me convinced me and encouraged me to come before the Court, because it showed me that enlightenment, not just precedent, took its rightful place in the process of the law. Having said that, of course I expected it - I will not deny it from your Honour and I do not mean any disrespect to my learned neighbours - I was given an avalanche of precedents this morning and truthfully, your Honour, they all flew over my head. Why did they do so? Because I do not think that in any of those precedents there stood before the Court somebody putting a proposition to the Court like I did.
In other words, if your Honour now refers to my pleadings, which are exactly the same in both instances, your Honour will see that they are as wide as anything your Honour can get about the Constitution. They do not pinpoint anything at all with any particular aspect. They invite your Honour to look at the Constitution as the man in the street would look at it. In other words, they invite your Honour to consider what I contend to be the meaning of the Constitution. By saying that, your Honour, that does not mean to imply to your Honour that what my learned neighbours have put to your Honour this morning in the way of precedents are in any fashion not valid. What it means to say is that (a) my submission was one undivided submission and that (b) it appears to me, with great respect to all, that my submission was somehow misunderstood.
Why do I make a broad statement like that, your Honour? I will then go to the submissions in reply by the defendants. I refer specifically to that by Samantha Gold, by Mr Heydon and Mr Jackman where at paragraph 1 - - -
HIS HONOUR: Resolute Samantha we have to call it now. Yes, Mr Heydon's submissions, yes.
MR GAMBOTTO: Paragraph 1 says:
The plaintiff challenges the validity of s 701 of the Corporations Law, on the ground that it infringes s 92 of the Constitution -
I stop there, your Honour, and just draw your Honour's kind attention to what I am going to say next. I sent your Honour a written submission of nine and a quarter pages and I am sorry it could not be made any briefer than that. I do not think, with respect, your Honour, I ever alleged either in my pleadings or in my submission that section 92 had been infringed.
HIS HONOUR: Why mention it?
MR GAMBOTTO: Why I mention it, your Honour, is a very important part of what I am going to say to your Honour. The position is this, that having told your Honour about precedents and what I think of them and having told your Honour about the unitary being of my submission, what I alleged in reference to section - - -
HIS HONOUR: What about paragraph 6(b) of your statement of claim?
MR GAMBOTTO: I said there in the third line:
said provisions of the Law interfere with the operations of the dictum imposed by S 92 of the Constitution of the Commonwealth in reference to the freedoms referred to within said S 92 insofar as said freedoms apply to the Plaintiffs and to the property of the Plaintiffs, namely the Plaintiffs' shares in -
Resolute. Samantha's:
determination to proceed with the compulsory acquisition of the Plaintiffs' shares in -
Resolute -
is, it is held by the Plaintiffs, in direct breach of S 92 of the Constitution.....in that it interferes with the freedoms as guaranteed by said section insofar as said freedoms apply to the Plaintiffs and insofar - - -
HIS HONOUR: We can all read it, Mr Gambotto, but it says "in direct breach of section 92".
MR GAMBOTTO: Yes, but then it goes on to qualify - - -
HIS HONOUR: Yes, I understand what you are saying.
MR GAMBOTTO: - - - the direct breach by saying "in that it interferes with the freedoms".
HIS HONOUR: Do you say there is no breach of section 92, so I have been wasting my time reading all these cases about section 92?
MR GAMBOTTO: No, I am not wasting your time, your Honour.
HIS HONOUR: No, but I have been wasting my time reading all these cases about section 92. You say it has nothing to do with section 92, do you?
MR GAMBOTTO: No, not at all. What I say, and my words in the last two minutes have been directed not to direct your Honour to the invalidity of my submissions as to section 92, but to direct your Honour's attention to the fact that it may well be that the defendants have mistakenly usurped my submission to make it so, or to contend that a breach of section 92 provisions had been carried out by them. The whole point they come up to your Honour with - both of them - is that section 92 deals with movement between States.
HIS HONOUR: Well, it does.
MR GAMBOTTO: And it does; of course it does. They have been putting to your Honour time after time, paragraph after paragraph, that there is movement. I have learnt all about the physical laws of movements: body at rest and body in movement - and I do not mean any disrespect once again. But my submission about section 92, apart from alleging what I read to your Honour in my statement of claim - and your Honour has quite capably said to me that he is capable of reading it - is that rather than a breach, which it is, what I allege as far as section 92 is concerned, is that section 92 gives all of us Australians the guarantee of certain freedoms.
HIS HONOUR: What are they, and which one is infringed here?
MR GAMBOTTO: The position has been put to your Honour starting at page 7 of my submissions. In no way should my submissions to your Honour about section 92 be taken to signify or to back up the position as it stands between the parties to the action. What I am asking your Honour is to see section 92 in the light I would like your Honour to see and that I contend is the true light.
HIS HONOUR: Where is that true light written down? I have to write a judgment, Mr Gambotto. Where have you written - - -
MR GAMBOTTO: I am aware of that, and perhaps this is where the untrained and unrepresented party before your Honour begs for your Honour's indulgence.
HIS HONOUR: I cannot indulge you from the requirement to present a case in legal terms.
MR GAMBOTTO: No, but it flows on from what I say regarding section 92, your Honour. It flows on as an inescapable fact, in my submission, that section 92 put certain propositions to the people of this country, and the propositions, in effect, are not what have been put to your Honour - - -
HIS HONOUR: What are they? You must put it positively.
MR GAMBOTTO: The proposition is this: that in my eyes according to what I have said in those written submissions, section 92 is a guarantee of freedoms. Freedom is a concept that resides with the citizens of the nation covered by the Constitution. It is not a concept of interstate movement or anything of such nature. What I am alleging to your Honour is this, that if I, or anyone else for that matter, has a guarantee of certain freedom given to him or to her by the Constitution, there is no necessity for movement to be involved.
HIS HONOUR: I understand that, but what is the freedom and how is it infringed by section 701?
MR GAMBOTTO: The section in practice puts me into a position where, unbeknown to me - because I could have been overseas. Your Honour cannot disregard what I am putting to your Honour now. Your Honour must look at that section 701. I am an Australian citizen and I am supposed to abide and rely on the Constitution. Nobody says that I cannot travel overseas, even for an extended period. Let us just imagine for one minute, for the purpose of this debate, that I have travelled overseas - - -
HIS HONOUR: There might be many shareholders who are foreigners who lived somewhere else but who had shares in an Australian company. They would be subject to section 701.
MR GAMBOTTO: I have never posed myself that question, your Honour, and I have never tried in my written submission to your Honour to even explore it. I feel it is beyond the parameters placed before your Honour.
HIS HONOUR: Yes, you are quite right. But you say you might have been away from Australia. So what? What follows from that?
MR GAMBOTTO: I might have been away from Australia and I come back and I am no longer a shareholder in Resolute. According to section 701(11), the consideration for my shares are held in trust. I come back to Australia and I find a letter telling me that my shares have been taken from me without my consent, without my doing anything. I have not done a single solitary thing and this law has taken my place as a citizen and this law has allowed a party to take over my property without my consent. Nowhere at this point of time - I think it is expedient on my part to put before your Honour this other additional thought that has been played upon by my learned neighbours, and that is that your Honour will not find anywhere in my pleadings or submissions any mention of just terms. In other words, I have never alleged in my pleadings or in my submissions that just terms had not been applied to that takeover of my shares. Just terms do not come into it.
HIS HONOUR: You say it is consent and you have never consented.
MR GAMBOTTO: I have never consented.
HIS HONOUR: But the question is: how does the Constitution help you in that respect and how does it make section 701 invalid?
MR GAMBOTTO: First of all I was talking about section 92. I said that rather than apply to a share transfer, as it is alleged by the other sides, section 92 applies to what I deem are my guarantees of freedom. One of the freedoms is to carry on with ownership of the shares that have been taken from me without my consent, and my whole submission went to that. I am sorry, your Honour, I may be cutting my own feet in the reason why I am coming before your Honour. But what I am saying is that I have placed before your Honour and before the defendant companies the fact that I look at section 92 as entirely something else from the way they look at it.
Rightly so your Honour will come back to me and say, "But the precedents have taken section 92 to read that way". If I have to subordinate my own thinking process and my own reason to the fact that some precedents are there telling me about certain things and I am presumed to know the law and, as I presented to your Honour before, precedent law, common law, I am presumed to know too and it is too bad for me if I do not know it.
I have never come before your Honour and said to your Honour that your Honour should consider that the common law is not applicable to me because I do not know it. I have never alleged that to your Honour and I do not expect to be treated any differently from anyone else who comes before your Honour with 300 QCs and 400 juniors and 5,000 precedents. What I expect is to be allowed to put to your Honour the reasoning behind what I say to your Honour. In this instance, what has been said about section 92 in those submissions in reply by the defendants does not apply, because I never alleged any of the things that they reply to. I only pointed out to your Honour that section 92 - I tried to as best as I could - guarantees me certain freedoms.
HIS HONOUR: Yes, but you have to tell me what they are, you see.
MR GAMBOTTO: The freedoms are that my property, I can do whatever I like with it. Specifically referring to section 92, I can travel with it interstate, I can mail it interstate, I can sell it interstate, I can buy it interstate. If I say to your Honour the actions of the defendants have interfered with my freedom as guaranteed by section 92, I do not mean to say that there has been any interstate intercourse by what I am saying. I am static, as was mentioned by one of my learned neighbours. I am static. I have in my pocket the shares, say, in Samantha - it was called Samantha then - or rather, in Resolute; it was called Resolute then. I do not know what became of it.
By doing what they have done, they have stopped me from doing anything, acting in accordance with the very freedoms that section 92 guarantees me. I know it is a novel approach, your Honour. I mean, I could see it from the submissions in reply. Nobody mentioned the word "interference". Everywhere "breach of section 92", "stationary positions", "movement", "interstate intercourse", and this, that and the other. The concept of section 92 in the way that I contend to your Honour - and I am not in any way implying that your Honour should abide by my contentions; far from it. Your Honour is much more knowledgeable about what the section means than I do. All I did put to your Honour was my understanding of section 92 which I think I have backed with some reasonable grounds as to whether they are, instead of being reasonable grounds, the ravings of a lunatic. I am not prejudging the issue. Your Honour may very well think that they are the ravings of a lunatic.
HIS HONOUR: I certainly would never say so, Mr Gambotto.
MR GAMBOTTO: I do not know whether your Honour has by now grasped what this plaintiff is all about. I use metaphors to a great extent and, when using metaphors in my rhetoric - which is backed by reasoning; it is not just rhetoric, I think - I pinpoint the weakest point of a case and enlarge it so as to bring it out to the attention of the onlooker.
HIS HONOUR: I hear what you say about section 92. You referred also to paragraph 51(xxxi) of the Constitution in your written outline, did you not, on page 6, in the middle of the page, for example?
MR GAMBOTTO: Yes. Again, that is not referring to section 92. Again, that is part of my entire submission as a unit and it is following the stated question - - -
HIS HONOUR: That is not quite right. It is on the top of page 6 actually.
MR GAMBOTTO: The bottom of page 5 follows with the top of page 6, which are my contentions. The bottom of page 5 asks is property a mythical concept under the Constitution? What I mean by that, your Honour, is this: it has been put to me, and I knew it even before coming here, that our forefathers, if I may respectfully call them that, drafted the Constitution and specifically excluded human rights from the Constitution because of the fact that they thought the common law was protective enough of human rights. I hope I have put it to your Honour as well as I could with my poor wording.
What I mean by my section 51(xxxi) of the Constitution is this, that the concept of property under the Constitution as it stands is not a mythical concept. The Constitution not only implies property rights but talks about property rights. As to whether - and there again there has been a great misunderstanding between the contentions of my learned neighbours and my contentions - what I brought forward the placitum as meaning that it is not a mythical concept, that the Constitution provides for private property. It clearly refers to private property in that placitum.
I have never alleged anywhere in my pleadings that there has been an infringement by the defendants of the dictum posed by section 51(xxxi). Certainly they are not thinking that I would go and say to them, "Hey, you are not acting under the placitum". First of all, I do not even know, your Honour - and I will be quite candid with your Honour - whether the Commonwealth Parliament has ever enacted laws under that placitum. When I say "placitum" I mean this, that it is my understanding, my constitutional understanding, that at the time of drafting there was some balancing of powers on the part of the founding fathers. In other words, they must have said to each other or to the conventions, "What are we going to do with this Commonwealth? Is this Commonwealth going to be empowered to do certain things only and the rest will be left with the States?"
In my view, your Honour, they decided to give certain powers to the Commonwealth and define them -and by definition they were restricted powers - and keep the rest for what was instead at the time a mythical concept of the States. The States, according to the Constitution, have all the powers, apart from some that have been granted to the Commonwealth Parliament by the Constitution. Your Honour will say why did I mention that placitum? It has two bearings on my case, in my respectful submission. One is that, in the minds of the founding fathers who drafted the Constitution, there was need to give the future Commonwealth the power to take property for its own uses.
Recognising that need of the community at large, which is represented by the Commonwealth, they defined by saying that they could pass laws for the acquisition of property on just terms. In other words, I put it to your Honour, with great respect, that what they had in mind was the fact that they did not want to create a monster that would just go about its way to acquire property or dispossess proprietors of their property and without any just recompense, without any reasons; in other words, willy-nilly. And that comes out clearly to mean in section 51(xxxi). That is one aspect.
The second aspect, your Honour, is this: as I said before, I do not even know - and I confess my utter ignorance in that respect - I do not even know whether the Parliament has ever acted on the placitum. The word "placitum" to me means that it can either act on it and enact laws on it, or not act on it. It is the very concept that I put to your Honour regarding the freedoms that I have under section 92. In other words, it gives me freedoms I do not have to move with them from State to State. It gives me the freedom to do so. Placita under section 51 of the Constitution gives the Commonwealth Parliament the freedom to enact laws regarding those specific placita. They do not have to do it.
So, in other words, as you can see from what I said to your Honour, it backs me in two points. It backs me exactly as to what I said regarding section 92 and it backs me, in my question to your Honour, is property a mythical concept under the Constitution? If it is not, I put to your Honour, then I have a right to property. It is not implied; it is there and I will come back to rights in a minute. What I am saying to your Honour is that there has been some misreading, if I may put it that way, with respect to all concerned.
HIS HONOUR: A lot of people have read it and a lot of them are very smart, Mr Gambotto, and they have been reading it for 90 years.
MR GAMBOTTO: I am not saying that I am the smartest; what I am saying is I am the stupidest. But I point out to your Honour that be I the smartest or the stupidest, that is the way I see it. When I come to write, your Honour, I always find difficulty expressing abstract thoughts. Your Honour deals in abstracts all the time, sitting on that bench. My learned neighbours deal in abstracts all the time; they have been trained to deal in abstracts. I cannot deal in abstracts; they are beyond me because I have to refer, in my mind, what I am talking about to something physical.
Respectfully, your Honour, may I put it this way, and I am using a metaphor again. I walk into a room with 10 people in it: one of them is a doctor in physics; one of them is a doctor in chemistry; one of them is one of the learned deputy registrars of this Court and the other seven are men from the street. On walking into that room, I mention the word "colour". It is very important that your Honour not think of me as a simpleton; it is very important that your Honour follows me word by word. When I enter that room and the 10 people are there, my mention of the word "colour" brings to mind to each of them, if they are listening, a certain conceptual context in their minds. These concepts are unrelated from each other.
One of the men from the street may think of green; one of the men from the street may think of red; the deputy registrar of this Court - and I am not saying whether it is a present deputy registrar or a past deputy registrar - may see red at my mention of colour and quote me black letter law. Your Honour will see that there are two colours in that concept. I go now to the two people who matter when I mention colour. One is the doctor in chemistry and the other one is the doctor in physics. Now, colour for the chemist, is the molecular composition of a certain substance that, when subjected to light, emits certain colours to the retina in the eye. In other words, the chemist is concerned with the molecular structure of the subject-matter and at my mention of colour, instantly thinks from full reflection white through the colours of the spectrum to full absorption black.
When I mentioned colour, your Honour, to those 10 people, there was never any implication meant by me. The word "colour" was a very precise word, especially and not so much to the eight people that I have referred to as coming from the street, but to the physicist and the doctor in chemistry involved. The chemist will look at it as molecular structure of any particular substance ranging from white to black; the physicist will think of light as reflected, again from white to black. When I said "colour" to all of them, your Honour can see that, without meaning any implication, the two people that counted knew exactly what I was talking about. I did not have to say "from white to black and all the colours in between" to them. There was no implication needed.
HIS HONOUR: Yes, I follow all that, Mr Gambotto, but how does it bear on this case?
MR GAMBOTTO: Right, I will come to that. When I go into the same room and I find 10 people there and nine are from the street and one is a Justice of the High Court, then I should think that the nine people from the street will think of freedom. When I mention freedom in such a room, someone who is just divorced will think of himself, "Yes, I'm free at last". Someone who has won the lottery will think, "I'm free". Someone who smokes Freedom cigarettes will think, "Oh, that's the weed I'm addicted to". But the Justice of this Court will know exactly what is meant by the word "freedom". In other words, it means complete freedom as defined by the laws that are applicable to the case. I do not have to explain all that to a Justice of this Court.
So, there is no implication, in my submissions, as to rights and freedoms - no implication whatever. We are either free or not free and that is what my submission is all about, your Honour. I hope that I have been able to put to your Honour clearly what I intended to say when I wrote this nine and a quarter page submission. It was unrelated to the facts of the matter. They were premises that I put to your Honour to attract your Honour's attention to certain aspects of our Constitution and - - -
HIS HONOUR: One question you have to face, I think, Mr Gambotto, is that section 701 is not a law of the Commonwealth; it is a law of a State.
MR GAMBOTTO: Exactly. Now, I have to address that question and I knew it. Your Honour will refer to my pleadings. At one stage in the past - this would not be known to your Honour, but I might as well explain - I thought it was a Commonwealth law.
HIS HONOUR: Yes, well you might be excused for that. But, the fact is it is not, so everyone tells me.
MR GAMBOTTO: I preface all that I said with the fact that I do not expect any leniency or favouritism.
HIS HONOUR: Yes. But, what is the answer?
MR GAMBOTTO: The answer to what your Honour has put to me and rightly so, I was going to cover it eventually, is that in my pleadings, I mentioned the words "Corporations Law". When my pleadings were written, I may not have been aware - I am not admitting to it - but I may not have been aware of the fact that Corporations Law exists in each State. But it did not say the Commonwealth Corporations Law; it said the Corporations Law.
HIS HONOUR: I follow that, but just as a matter of fundamental substance, you have to deal with it.
MR GAMBOTTO: The fundamental substance, in my eyes, your Honour, is this: that by not restricting my pleadings, then the argument reverts to my written submission.
HIS HONOUR: Yes, and what is the argument in so far as it affects States rather than the Commonwealth, you see?
MR GAMBOTTO: I am saying quite clearly in the argument, I would have thought it was quite clear - I beg your Honour's indulgence if, instead I was not. What I am saying is that it does not matter which law it is, whether it is a New South Wales law, a law imported from England and adopted by some States and so forth and so on. It does not matter a hoot in my eyes. That does not have to carry weight with your Honour. What I am saying to your Honour is that it does not matter to me that the law is the law in - it could very well be the case that the law is different in each State.
We found out by all the submissions that have been put this morning that they are not and that there is even a provision within the Commonwealth law and each law to make it so that if the Commonwealth changes its stance about the particular section, then the others follow automatically without them having to be debated in the Parliaments of the States and so forth and so on. But that does not really matter; it is outside my terms of reference.
I have not stopped my learned neighbours from putting those submissions but, to my mind, they are very irrelevant if your Honour agrees with me that I have dealt with that aspect by alleging that the States cannot contravene the provisions of the Constitution. Whether they are States, colonies or whatever, we are all living under one Constitution. It rules; it is the supreme law your Honour said at the very beginning and I noted those words and I re-focus your Honour's attention to those words. It is the supreme law.
When your Honour says to me it is the supreme law of the land, surely your Honour is not talking about the residents of the Australian Capital Territory. I am not a resident there; I am a Queensland resident. So, if your Honour says to me, a Queensland resident, the Constitution is the supreme law of the land, surely it applies to me as well as to any other State residents. What I am alleging in my submission is that it has been a misconception of the whole thing.
Now, I know the points have been debated in various cases; I am not that ignorant, your Honour. I could have used precedents myself. That does not mean to say that I could have used them successfully but, by saying that, I admit to my learned neighbours that there are precedents applicable to my contentions. At the same time, I stand on the reasoning behind my contentions. If they carry any weight with your Honour or not, it is another thing and I thank your Honour for your attention.
HIS HONOUR: Thank you, Mr Gambotto. Does anything arise from that, gentlemen?
MR HEYDON: No, your Honour.
HIS HONOUR: You live in Queensland, do you, Mr Gambotto?
MR GAMBOTTO: Yes.
HIS HONOUR: And you have come down specially for today, have you?
MR GAMBOTTO: I did, your Honour, yes.
HIS HONOUR: I will consider my decision in this matter and the Court will now adjourn.
AT 12.51 PM THE MATTER WAS ADJOURNED
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