Haig v Minister Administering the National Parks & Wildlife Service Act 1974 S29/1995 [1995] HCATrans 405 (24 November 1995)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Sydney No S29 of 1995

B e t w e e n -

BRYAN DOUGLAS HAIG

Applicant

and

THE MINISTER ADMINISTERING THE NATIONAL PARKS AND WILDLIFE SERVICE ACT 1974

Respondent

Application for special leave to appeal

BRENNAN CJ

DAWSON J

TOOHEY J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY ON FRIDAY, 24 NOVEMBER 1995, AT 11.12 AM

Copyright in the High Court of Australia

MR J.P. HAMILTON, QC: If the Court pleases, I appear with my learned friend, MR A.A. HYAM, for the applicant. (instructed by Blake Dawson Waldron)

MR T.F.M. NAUGHTON, QC: May it please your Honours, I appear for the respondent and MR M.J. McGROWDIE appears with me. (instructed by I.V. Knight, Crown Solicitor for the State of New South Wales)

I should inform your Honours it is a State Act, not a Commonwealth Act.

BRENNAN CJ: Yes, thank you, Mr Naughton. Mr Hamilton.

MR HAMILTON: Your Honours, this is a case in which the special leave point concerns the ambit and the application of the Pointe Gourde principle applicable in cases of the assessment of compensation for compulsory acquisition.

BRENNAN CJ: Does it not concern the interpretation of section 125?

MR HAMILTON: No, not in reality, your Honour.

BRENNAN CJ: Why not?

MR HAMILTON: Your Honour, it is because its ambit is very much wider than that. We would hardly be here if that were all it concerned, in view of the death of section 125, quite apart from anything else. Why we say it is wider than that, your Honour, is that it concerns three matters of general importance arising from the Pointe Gourde principle - - -

BRENNAN CJ: Before you get to the question of the Pointe Gourde principle, why does not section 125 apply?

MR HAMILTON: It applies as the point from which one commences. We say, however, that its operation in literal fashion is displaced in this case by the Pointe Gourde principle and the question arises - - -

DAWSON J: Just let me be quite clear. You do not dispute that the land in question is resumed land which has been alienated in fee by the Crown within the five years - - -

MR HAMILTON: Exactly, your Honour.

DAWSON J: So that it falls within the section.

MR HAMILTON: It falls within the section, your Honour.

DAWSON J: And the amount of compensation payable under the section is twice the amount - - -

MR HAMILTON: The amount of compensation payable calculated in accordance with the formula in the section - - -

DAWSON J: Which in this case amounted to twice the amount paid.

MR HAMILTON: Which amount to $1,596 as opposed to a value of the land assessed in another fashion of approximately $195,000.

DAWSON J: You are now going to tell us why that amount of compensation is not the amount of compensation - - -

MR HAMILTON: Exactly, your Honour.

TOOHEY J: I thought your argument was that section 125 did not apply in its entirety or, rather, did not comprehensively determine the question of compensation, but it only determined the question of compensation in regard to one aspect of the applicant's interest and that otherwise that interest was to be assessed on some other footing.

MR HAMILTON: Our case is that because of the events which have occurred the formula ceases to be applicable. That is the central issue here, that that formula - - -

TOOHEY J: You mean ceases to be applicable at all?

MR HAMILTON: Ceases to be applicable at all, your Honour.

DAWSON J: You say you are entitled to the $1,500 but you are entitled to more.

MR HAMILTON: No, your Honour, we say that here the result of the application of the Pointe Gourde principle would be that you did not employ that formula; you valued the land on ordinary principles.

TOOHEY J: Is that not tantamount to saying that section 125 does not apply?

MR HAMILTON: It is and it is not, your Honour. Why I conceded what - there was an earlier appeal, as your Honours are no doubt aware from the papers, in which the Court of Appeal held that section 124 did not apply but that section 125 did apply. At that time the Pointe Gourde principle was not raised in the fashion in which it now is and, indeed, had section 124 been the applicable principle, one would not have needed to rely upon the Pointe Gourde principle because value would have been assessed in the ordinary way.

TOOHEY J: But is it your argument, Mr Hamilton, that section 125 applies to the cost of acquiring the fee simple over and above the perpetual leasehold, otherwise compensation is to be assessed in accordance with section 124?

MR HAMILTON: No, your Honour. What we say is this: true it is, as your Honour Justice Dawson has put to me, that the case is a case that falls within the section upon the terms of the section in that the freehold - the land was converted to freehold and the freehold acquired within the period. The Pointe Gourde principle, we say, however, is a principle not as the Court of Appeal said of establishment of value but of the payment of compensation and the Pointe Gourde principle, we say, when one comes to section 125, operates to exclude the statutory formula when it is by reason of the operation of the acquisitive scheme that section 125 came to apply.

DAWSON J: But the Pointe Gourde principle can only apply where the question of valuation arises in relation to compensation. It does not arise under section 125.

MR HAMILTON: What your Honour Justice Dawson puts is exactly what we say the point is here. We say that it is not correct to say that it arises only when a question of valuation comes in; we say that the Pointe Gourde principle operates when there is any assessment of compensation.

BRENNAN CJ: I just do not understand what you are saying, Mr Hamilton. If this acquisition falls within section 125, that section says that the compensation to be paid "shall be a sum of money.....equal to"; "shall be". What is it, what principle can possibly deny to those words their clear operation?

MR HAMILTON: We say that the operation of the Pointe Gourde principle, which is a principle of compensation law, operates to exclude that formula, despite the words that your Honour the Chief Justice puts to me, where the section and the formula have come to apply by reason of the operation of the acquisitive scheme. We tackle that quite head on, your Honour. We say that it is a principle of compensation to ensure that the value of land is not changed, either increased as in many cases or decreased as in other cases, by operation of the scheme and that it is by the operation of the scheme that the events occurred which brought this piece of land within the formula.

TOOHEY J: When you say "this piece of land", what interest in the land? Are you speaking of the fee simple?

MR HAMILTON: Your Honour, it is the fee simple that has been resumed and the fee simple which must be valued.

TOOHEY J: Once you make that concession, and it seems to me a concession that has to be made - - -

MR HAMILTON: Yes, I think that is correct.

TOOHEY J: - - -what do you do with section 125? I mean, do you just put it to one side?

MR HAMILTON: Only in the extremely limited - we say that in the very limited circumstances where you have been brought within the section, through the operation of the scheme, then the section is set aside.

BRENNAN CJ: What is it, either in the section or in the context, which gives the section an operation limited so that it is inapplicable when land is acquired pursuant to a scheme?

MR HAMILTON: It is nothing in the section that does that.

BRENNAN CJ: Is there anything in the context of the section?

MR HAMILTON: No, your Honour. We say - - -

BRENNAN CJ: Then the statutory provision is absolute; so far as the statute goes.

MR HAMILTON: Yes, your Honour.

BRENNAN CJ: How can any question of valuation principle, any common law basis of valuation principle, outflank the absolute terms of the statute?

MR HAMILTON: Your Honour, the point that we seek to put is the point that it is not a matter of valuation principle but - - -

BRENNAN CJ: Is it not statutory construction, surely?

MR HAMILTON: - - -but of compensation principle.

TOOHEY J: That does not help you, because the section speaks of compensation.

MR HAMILTON: Yes, your Honour.

TOOHEY J: And provides the basis upon which compensation is "to be paid for and in respect of any land acquired or taken under this Act". So once it is acquired or taken under the Act, it does not seem to advance the case much to speak in term of schemes, unless somehow you seek, as I do not understand you to do, to take this out of the operation of section 125.

MR HAMILTON: We say that it is taken out of section 125 by reason that it is through the scheme that it is brought within section 125.

TOOHEY J: What is the "it" that is taken outside section 125?

MR HAMILTON: The assessment of compensation, your Honour.

TOOHEY J: That seems to fly simply in the face of the language of the section.

MR HAMILTON: The Pointe Gourde principle is a principle which certainly in other circumstances operates to modify the assessment of compensation in the face of various statutory formulae. There is always argument, of course, as to - or there are different formulations in language. In some places the highest courts have called it a principle of the common law; at other times it is pointed out that there is no common law of compensation, that the whole law of compensation is a matter of the principles - is partly the statutes and partly principles developed by the courts in the interpretation and application of those statutes. It is our contention that one of those principles is that the principle that the compensation ought be fair and just - we, of course, are talking in a context of State law where there is no constitutional consideration - but nonetheless, the principle that statutes ought not be construed so as to permit the expropriation of property without compensation or adequate compensation, together with the use of the fact that the very word "compensation" itself imports a notion of fairness and adequacy; that the courts have developed principles that ensure that that is done so far as possible.

One of those is the Pointe Gourde principle and we say there are various dicta in various decisions at high levels that fairness should be seen by the courts to be done in these circumstances and that that is a principle of compensation. In some places it is spoken of as a principle of compensation; in some places it is a principle of valuation.

TOOHEY J: According to the Court of Appeal's judgment that principle has found its way into section 124, but section 125 establishes an entirely different regime.

MR HAMILTON: With great respect, the Court of Appeal is erroneous in that. Section 124 goes back long before Pointe Gourde was enunciated as a principle and what is more, of course, it is simply not correct to say that section 124 embodies the Pointe Gourde principle because it embodies only half of it. In fact section 124 is taken from an earlier Valuation Act in New South Wales and that was taken from one of the Railway Clauses Acts in England last century and refers in terms only to an increase in valuation. It is not correct to say, with respect to the Court of Appeal, that the Pointe Gourde principle is embodied in section 124.

There is not, in this statute, a statutory encapsulation of the Pointe Gourde principle. The Pointe Gourde principle operates as a matter, we would say not of common law but of general law developed by the courts, partly as part of interpretation of statutes but, more importantly, as a principle of ensuring, so far as possible, fairness in compensation. Fairness, of course, is always a two-sided thing. The fairness is that acquiring authorities are not prevented from, or hampered, in acquiring, by the value of the land they acquire being increased by the scheme, as in Pointe Gourde itself, where the property was a quarry and the scheme was for a naval dockyard nearby and, equally, the compensation ought not be diminished by the land being depressed in value by the existence of the scheme in the widest sense and things done under it.

BRENNAN CJ: What is your best, if any, authority that suggests that when a scheme is adopted which involves the acquisition of property, the compensation for which is limited by a provision such as section 125, such limitation has no application?

MR HAMILTON: There is no authority that I can cite to your Honours that deals with a statutory provision such as that and supports the proposition.

BRENNAN CJ: Is there any authority other than one which states the general basis of compensation where the task confronting the Court is to determine the fair value of the property acquired? In other words, where the function is to determine the fair value, then the Pointe Gourde principle applies. Is there any case which deals with the specific problem raised by section 125?

MR HAMILTON: No, there is no case that deals with the specific - there is no case that deals either way, your Honour, with a statutory formula that we are aware of.

BRENNAN CJ: And is it right to say that the Pointe Gourde principle is applied under statutory formulae, no doubt varying from jurisdiction to jurisdiction, which requires the Court to determine the fair value of the property acquired at the time of acquisition?

MR HAMILTON: I think that is correct, your Honour. I am just trying to cast my mind over a fair range of authorities, but I think that is correct, your Honour.

BRENNAN CJ: It is really a case then, Mr Hamilton, is it not, of seeing 124 as being the general provision and 125 as being a special provision?

MR HAMILTON: Yes, your Honour.

BRENNAN CJ: And in that context the ordinary rule of statutory interpretation, albeit productive of injustice, is that the general provision yields to the particular?

MR HAMILTON: Your Honour, in general terms it does, and that is why I have conceded from the start of this argument that prima facie the applicant in this case is within section 125. Our proposition is that, properly considered, and really there is no authority either way, the Pointe Gourde principle is a principle of compensation rather than simply of valuation and that where it is the scheme that has caused the property to be brought within the special provision, then the special provision ought not be applied, particularly where it creates a manifest injustice.

Where we say the Court of Appeal has erred, the Court of Appeal has, in effect, said that that proposition cannot be considered because the Pointe Gourde principle is a principle of valuation only. Your Honours, one case where the Pointe Gourde principle has been considered in an area where it was not simply a determination of value was the Rugby Water Board Case which my learned friend has referred to, and what was said by the majority of the House of Lords in that case was that the principle applied only to a determination of value and could not apply to whether or not the scheme caused changes of title. When your Honour the Chief Justice asked me the question earlier, I should perhaps have referred to this there.

BRENNAN CJ: Could you read it, the relevant part?

MR HAMILTON: The relevant part, yes. Could I put this to your Honours first, that the majority of the House of Lords in that case said that it did not apply to changes of title but to valuation only whilst, on the other hand, there was a strong dissent by Lord Simon of Glaisdale who took the opposite view and who held that in that case, where the change of title was brought about by the scheme, then it ought to be ignored for the purpose of determining the value. The change of title in that case was that it was an agricultural holdings lease with a - - -

BRENNAN CJ: Mr Hamilton, your time has expired, but you can have another three minutes because you have been somewhat interrupted in the course of your argument.

MR HAMILTON: Thank you, your Honour. That what occurred there was that there was an agricultural holdings lease which was of value because of its long protection under the Agricultural Holdings Act but there was a break clause in it if the land were acquired for certain purposes, and the existence of the scheme, in effect, brought the break clause or development clause into effect. The result of this had been to diminish the value of the agricultural tenant's title in the long term.

Now, that is a case where the majority of the House of Lords was against the argument that we put, as Mr Naughton has drawn attention to in his submissions, but Mr Justice Gobbo, for instance - to show that it arises, it has been dealt with by Mr Justice Gobbo in the valuation jurisdiction of the Supreme Court of Victoria recently with a service station case where his Honour felt himself bound by the majority, although himself attracted to the argument of Lord Simon. So that is a case, your Honour, where the question has arisen as to whether one went outside valuation or not. Beyond that, I think that is the only case I know of where it was in the centre, but there are other dicta, for instance in the Privy Council in the Malwood Units Case that we have mentioned, where it is suggested that it is a principle of compensation, not simply of valuation.

So that our case is that taking it as a principle of compensation, then one can employ it in the appropriate case in order to displace the special provision. I come down the track with your Honours to that point, but our point is that the view put forward by Lord Simon is the appropriate one and that it is not simply a valuation matter. That is what the Court of Appeal took it to be, based on other authority, but one where we seek to say that this injustice can be set aside by the Court, and quite properly so, treating the Pointe Gourde principle as something that goes beyond valuation, where the courts can insist upon a fair compensation, where one is brought into the special provisions, as your Honours have pointed out it is, through the operation of the scheme.

We say that that, your Honours, is an arguable point. It is a point which is of current importance. It is not limited to the dead section 125 but to a whole range of valuation statutes in Australia and it is a principle of importance which calls for special leave. Those are our submissions to your Honours.

BRENNAN CJ: We need not trouble you, Mr Naughton.

The decision in the court below is not attended with sufficient doubt to justify the grant of special leave. The application for special leave must be refused. The result is that, perhaps contrary to the justice of the case, the applicant's right to compensation is limited by a statutory formula which precludes the payment of compensation assessed according to the fair value of the land acquired.

MR NAUGHTON If the Court pleases, I now make my application for costs, your Honours.

BRENNAN CJ: What do you have to say, Mr Hamilton?

MR HAMILTON: There is nothing I can say, your Honour.

BRENNAN CJ: The application is refused with costs.

AT 11.38 AM THE MATTER WAS CONCLUDED