Grain Pool of WA v Commonwealth of Australia & Anor P34/1998 [1999] HCATrans 359 (6 October 1999)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Perth No P34 of 1998

B e t w e e n -

THE GRAIN POOL OF WA

Plaintiff

and

THE COMMONWEALTH OF AUSTRALIA

First Defendant

CULTIVAUST PTY LTD

Second Defendant

Office of the Registry

Adelaide No A11 of 1998

B e t w e e n -

CULTIVAUST PTY LTD

Plaintiff

and

THE STATE OF WESTERN AUSTRALIA

Defendant

GLEESON CJ

GAUDRON J

McHUGH J

GUMMOW J

KIRBY J

HAYNE J

CALLINAN J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 6 OCTOBER 1999, AT 10.19 AM

(Continued from 5/10/99)

Copyright in the High Court of Australia

__________________

GLEESON CJ: Yes, Mr Solicitor.

MR BENNETT: If the Court pleases. My remaining submissions fall into four sections. They are, inventive step, external affairs, the Western Australian argument on positive rights and section 82.

On inventive step, which I substantially dealt with yesterday, there are five short matters I wanted to mention, which arise out of what was said yesterday. The first is, there was reference to the second reading speech by Mr Kerin, and your Honour the Chief Justice referred to a passage at page 1651. I simply wanted to refer your Honour to another passage on the following page where, in the middle of the first column, Mr Kerin said two things about the Variety legislation. The first was:

To be eligible for grant of a right the variety must be new. The new variety therefore must be clearly distinguishable from any other known variety. It also must remain true to type in future generations. The variety must have been developed by selective breeding -

et cetera.

It is a scheme for new plant inventions.

We stress that phrase. We respectfully submit that that is reflected in the Act.

Secondly, your Honour Justice Kirby asked me about Chakrabarty. The case is called Diamond v Chakrabarty [1980] USSC 119; (1980) 447 US 303. Your Honours do not need to go to it. It is a case which decided that new life forms could be patented. The minority and majority differed on that basic principle. That principle has not, as far as we are aware, been seriously questioned in Australia.

GUMMOW J: Were they interpreting constitutional power or legislative - - -

MR BENNETT: Yes, constitutional power, as I understand it, your Honour.

KIRBY J: The Supreme Court divided five justices to four, I think.

MR BENNETT: I think that is so, your Honour. It certainly divided. Yes, five:four; your Honour is correct. The majority was Chief Justice Burger, Justices Stewart, Blackman, Rehnquist, as he then was, and Stevens. The minority was Justices Brennan, White, Marshall and Powell.

The third matter is: I was asked yesterday about the cases concerning the question of medical procedures. The question of course partially involves the question of new process and the extent to which it is a new process and partly involves a question of principle. Your Honours will recall the original Statute of Monopolies referred to "not inconvenient" and "contrary to public interest" and so on.

There have been a number of cases in this Court which have referred to the issue but not decided it. Those cases, if your Honours wish them to be listed are, Maeder v Busch (1937-1938) 69 CLR 684 and 699, Joos - - -

GUMMOW J: What volume did you say?

MR BENNETT: Volume 69, your Honour.

McHUGH J: I think that is wrong. I think it is 59.

GUMMOW J: Yes.

MR BENNETT: I am sorry, 59, yes. Joos v Commissioner of Patents [1972] HCA 38; (1972) 126 CLR 611 at 622 to 623 and Advanced Building Systems v Ramset [1998] HCA 19; (1998) 194 CLR 171 at 190. None of those cases decide the issue. In the Federal Court Justice Heerey decided the issue in favour of the proposition that such things were not patentable, although it was in the sense obiter because there were a number of other bases on which his Honour seems to have principally decided the cases. That is Bristol Meyers v Faulding (1998) 41 Industrial Property Reports 467. The Full Court has reserved on that and no doubt it is on its way here. It is on its way here; no doubt on its way here.

There is also a case called Anaesthetic Supplies Pty Ltd v Rescare Ltd in the Full Court in [1994] FCA 1065; (1994) 50 FCR 1 where a majority of the court held that such things were patentable and there was a dissent by Justice Sheppard.

KIRBY J: Which is the best statement in this Court of the essence of patents of inventions? I mean, leaving aside all these other cases, but where is the essence of it best expressed?

MR BENNETT: I do not think I can give your Honour a useful answer to that question because there are a number of elements and most of the cases tend to be discussing particular elements and almost invariably the cases are discussed in not the constitutional power, but the particular statute and the statutory definitions and phrases are varied from time to time.

KIRBY J: Is there any academic or other analysis of the cases with the point which we now have in hand under review, or something like it?

MR BENNETT: Not that I am aware of, your Honour. There is some earlier discussion in Potter's Case but, again, I do not think that involved constitutional validity. The NRDC Case which, I think, was referred to yesterday, but again that is not a constitutional case.

GAUDRON J: Would you dissent, however, Mr Solicitor, from what was said in Nintendo or seek to take it further than what was said in that case?

MR BENNETT: No, your Honour, we are content with that.

GAUDRON J: Which seems to be dealing with the constitutional essence of what is - - -

MR BENNETT: Yes, that is probably the closest one gets, your Honour. The fourth matter from yesterday is I was asked about the Trade Marks Act 1989 and about faces and look-alikes, and matters of that sort. The Trade Marks Act has a very wide definition. Section 17 says "A trade mark is a sign used, or intended to be used, to distinguish" certain things. "Sign" is defined in section 6 as including:

the following or any combination of the following, namely, any letter, word, name, signature, numeral, device, brand, heading, label, ticket, aspect of packaging, shape, colour, sound or scent.

So, one can, in fact, trade mark a scent.

KIRBY J: I should hope so. I mean, they would be very valuable commodities.

MR BENNETT: One wonders about - - -

KIRBY J: Especially if they are very well packaged.

MR BENNETT: One wonders about the articled clerk doing a search and how that is done, but no doubt there are ways of achieving it.

In relation to celebrity faces and the problem of look-alikes and so on, the cases discussing that have all been based on passing off. In the United States, of course, look-alikes are a major business. Your Honours, there was a film some years ago about it called "Dave" about a presidential look-alike and it is a very well-known form of activity in the United States. I am instructed that the - instructed is the wrong word - under the Trade Marks Act there have been trade marks granted in that area. The basis is that shape can be said to include the shape of a face and, therefore, there are circumstances where one can trade mark a face. The example I was trying to think of yesterday, and I think I said tyres, was in relation to the well-known face of Bob Jane which one sees on service stations. That is a slightly different situation because that is not so much a trade mark of one's face as such, but a trade mark of a representation of a face. But I am told that it is possible to trade mark a face itself in - - -

GLEESON CJ: I suppose Colonel Sanders has a trade mark.

MR BENNETT: I am not sure if that is in the same category as the Bob Jane trade mark, the trade mark being the representation rather than the face itself. But, in any event, a very wide view has been taken under the Trade Marks Act and, no doubt, one day the issue of constitutional validity will arise, but we would submit that all those matters are squarely within the constitutional concept.

Finally, in relation to inventive step, yesterday my learned friend Ms Harris dealt with an argument which was based on the distinction between process and product. I did not really do that argument justice yesterday and I should just very briefly - - -

GUMMOW J: You referred to the definition of "exploit" in relation to that in the 1990 Patents Act.

MR BENNETT: Yes, your Honour. The argument as I understand it is this: that when one looks at each of the two Acts in question, the constitutional limitation section, section 5 in the Variety Act and 10 in the other Act, refer, on her argument, to process rather than product, and rely for the constitutional basis on process rather than product, although the grant is in respect of the product.

GUMMOW J: She goes further than that, I think. She said - and this is the blue rose point, I think - you go to the definition of "exploit" that you referred us to yesterday in the 1990 Act, that differentiates between the invention as a product and then "exploit" includes make, use et cetera, sell the product or:

where the invention is a method or process - use the method or process -

One understands that:

or do any act mentioned -

That is to say make, use or sell an article:

in respect of a product resulting from such use.

She said that the blue rose might not result from the particular process, to use the analogy, and therefore it goes beyond the idea of product and process monopoly in the Patents Act. I think that is what she said.

MR BENNETT: Yes. Your Honour, one can, of course, under the Patents Act patent the product so long as the product is new and one has the other elements that were discussed.

GUMMOW J: She said that is not what is done here, you see. That is her point.

MR BENNETT: Yes; what we submit is that when one looks at the - perhaps I will start with the Variety Act because they are slightly different - that uses in section 5 the phrase - one cannot get the grant unless the origination of that new plant variety constitutes an invention for the purposes of the Constitution. We submit that the key word there is not "origination" which is really a colourless word, a neutral word, if one likes, but the reference to the "new plant variety".

It has to be a new plant variety. Obviously, like everything else, it has to be originated, but it is the fact that one has created the new plant variety rather than how one does it. In other words, it is in the product box, not the process box.

GLEESON CJ: Presumably the corollary of the argument against you is that there is some constraint upon the power of the Commonwealth Parliament to amend the Patents Act.

MR BENNETT: That would have to be so, your Honour, and that is why our central argument is that none of this matters. It does not matter at all what the Patents Act says. The issue is: what is the core concept behind the phrase in the Constitution? When one goes to the Plant Breeder's Rights Act - - -

GUMMOW J: Yes, but the core concept is invention, and what is put against you is that you are doing more than protecting the invention if you protect a product made by a process which may be the process which is the invention but may also be made by another process which is not the invention. That is what the objection is and that is said not to be protecting the invention. You do not skim over it by talking about core concepts - not to my mind anyway.

MR BENNETT: Your Honour, there are two answers to that. The first is that when one goes to the - - -

GUMMOW J: I think it is right. I think Ms Harris would say on her argument that there would be a problem with the Patents Act if that definition of "exploit" protected products which did not result from the application of the process where the protection was the process, the invention was the process.

MR BENNETT: If one invents a better mouse trap which has the catch in a different position and therefore catches mice more efficiently, it may be completely irrelevant how one assembles it: what order one assembles it, what parts one uses to assemble it or anything else. The product is what is patented and the process is completely irrelevant and the product is what is protected if it is a product patent. If one is dealing with a method of making mouse traps, then of course one is dealing with a process patent. But we would submit it is quite clear under the Patents Act that the classic better mouse trap is a product, not a process, and that is all that is protected. The process is just irrelevant in that situation. Although the phrase "manner of new manufacture" is used in the original Statute of Monopolies, that has not been construed, in our respectful submission, as meaning that one cannot have a product patent. That is what this Act does.

GUMMOW J: I do not think anyone suggests you cannot have a product patent.

McHUGH J: In fact, all the early cases - - -

GUMMOW J: That is what they are.

MR BENNETT: Yes, precisely.

McHUGH J: Many of the early cases were just simply concerned with products as such.

GUMMOW J: We are talking about a new process for making an old product, to put it in crude terms.

MR BENNETT: It may be a new process for making an old product; it may also be a new product.

GUMMOW J: Well, obviously.

MR BENNETT: Under section 10 of the Plant Breeder's Rights Act, again it refers to the breeding "constitutes an invention" but the word "breeding" is defined by section 5(1) as including:

the discovery -

which is a neutral word -

of a plant together with its use in selective propagation so as to enable the development of the new plant variety.

But that is the development of the plant in the future. Again, when one puts together sections 5(1) and 10, what is being talked about is the product. The Act as a whole makes that quite clear.

GUMMOW J: Looking at the Variety Act, which is the first one, section 12 gives exclusive rights in relation to "plants of that variety". The question is what that expression "that variety" means. Is that the variety originated under 5(a)?

MR BENNETT: Yes, your Honour. One is given a series of exclusive rights in relation to it. That was the point of the blue rose example yesterday, that it is not how you make it. How you make it can probably never be duplicated because there is always the element of chance whenever one mates two plants to product offspring. There is the element of chance as to exactly what one gets. When one gets a whole range of them and picks ones and selectively breeds those through a few generations, one is necessarily engaging in a process which cannot be repeated because what one gets will always be that little bit different.

The process, of course, is a well-known process. There is nothing new. One would probably find that 90 per cent of plant varieties registered under these Acts are produced by a similar process but what is different is that one will always have what corresponds to the inventive step and the newness because of the ultimate difference in the final product. Those are my submissions in relation to inventive step.

Now, in relation to external affairs, there are a number of short points. First, there was reference made to Justice Mason, as his Honour then was, in the CLM Case 136 CLR 235 and that appears in paragraph 37 of our submissions. Might I just take your Honours to that passage because it is one of some importance and I do need to explain it. The passage in the judgment is at 243. It is probably more convenient for your Honours to use paragraph 37 of our submissions. His Honour was making the point that there was nothing wrong with an anticipatory enactment in relation to a treaty or convention and he said:

It was not.....suggested with any semblance of correctness -

so, his Honour put the proposition very highly -

that the external affairs power (s.51(xxix)) or that power in combination with the incidental power (s.51(xxxix)) cannot sustain the enactment in an anticipatory way of the provisions designed to give effect to an international convention once it becomes binding on Australia -

Now, my learned friend seized on the qualification where his Honour said:

so long as the provisions do not come into operation before the convention does become binding in this country.

Now, a number of things follow from that qualification. The first is, his Honour was not suggesting that if that were not the case the whole Act would be invalid. The passage is at least consistent with the possibility that the Act might be valid only after the Convention becomes binding. The second point is that the converse simply does not follow from his Honour's proposition. One cannot deduce from what his Honour said a proposition that if the provisions do come into operation before it becomes binding it can never be a valid exercise of power. His Honour simply was not considering that question and did not need to consider it. The case before him involved the situation covered by the proviso and therefore that was all his Honour was dealing with.

KIRBY J: But the suggestion is that unless Australia subscribes and becomes a party to the treaty, then you cannot rely on that part of the external affairs power which is the treaty part and that seems a logical and proper conclusion, both for the reason that his Honour hinted at and for the reason that Justice Callinan mentioned yesterday. It is not a real treaty. It is just something somebody else has done. It is not a treaty as far as Australia is concerned.

MR BENNETT: Yes. I put the two submissions on that yesterday, the first being that where you have an international convention by definition it is always going to be a matter of international concern within the other leg - - -

KIRBY J: What, even a treaty between countries of South America or even a treaty between a few obscure nations of outer Kazakhstan.

MR BENNETT: Yes, your Honour.

KIRBY J: I mean, really, it has got to - you cannot elevate it into a matter of international concern just because it is a treaty.

MR BENNETT: Your Honour, I used the words "international convention" involving a number of parties. But the - - -

KIRBY J: You see, this does have a potential to unravel the federal scheme and that cannot be permitted, that cannot be permitted to be so large that it unravels the federal Constitution.

MR BENNETT: Your Honour, in my submission it does not do, merely saying - the difference between saying that there is international concern where there is a convention on the subject matter which your Honour suggests is on one side of the line and saying that once, of course, Australia becomes a signatory there is no question that it is within power on the other side is not a large jump and it does not, we would submit, unravel the federal balance to move that little bit further. Once there is an international convention it is normally open to the Federal Government to accede to it or become a party to it, not always, but almost always. The question, therefore, becomes a matter of international concern. While one can imagine a colourable treaty in a bilateral situation, it is almost impossible to imagine a colourable treaty in this situation. Perhaps the only example I could think of of a colourable international convention might be one where the United States, Canada and Australia got together and said, "Let us increase our federal powers at the extent of our States and have a convention on a whole lot of minor domestic matters which will enable us to overcome State powers". One might have that situation - - -

McHUGH J: Not necessarily. Supposing before Australia was on a war footing simply because treaties were entered into between, say, Nazi Germany and Russia, would that enable the Commonwealth to legislate on a defence basis?

MR BENNETT: Yes, your Honour, and I will take your Honour to a defence case in a moment. There is a reference in one of the cases to the defence power in that area.

KIRBY J: What about Justice McHugh's question yesterday concerning a European convention. I think, theoretically, Australia might be able to subscribe to some of those, but would such a treaty be a matter of "international concern"?

MR BENNETT: Yes, your Honour, with the world shrinking as it is in almost every respect with computerisation and so on, the distance is no longer the same bar to it being relevant to Australia that it once was. Once one has an international convention, it is a matter, we would submit, for the Executive Government (a) to decide whether to accede to it, and (b) in the period leading up to or preparatory to the decision whether to accede to it and the final decision whether to accede to it, to pass legislation in accordance with if that is going to facilitate - - -

McHUGH J: But perhaps you have to go further and identify the nature of the subject matter because it may that it is purely domestic legislation. That is the argument that is put against you here. Now I know there is a world-wide condemnation of tobacco and cigarette smoking and so on, but supposing the European Union entered into some agreement or legislated, would that authorise the Commonwealth to outlaw all forms of tobacco smoking, advertising, et cetera, in this country?

MR BENNETT: Your Honour, there may be a question of degree at some stage as to what makes something a question of international concern. A hundred years ago, it probably would have been said that racial discrimination was not a matter of international concern.

McHUGH J: I do not think you have to go back a hundred years.

MR BENNETT: No one does not, and indeed, Croome's Case is another example of something which is now seen as a matter of international concern and was not some time ago.

This Act is perhaps a good example as well because it contains, both Acts contain, various provisions dealing with foreign applications and fast track procedures for people who already have plant variety registration overseas. Section 29 of the Plant Breeder's Rights is an example - - -

McHUGH J: Yes, but it is put against you that they do not get any further rights here by reason of their overseas registration or rights. They have to make a fresh application.

MR BENNETT: They do get further rights, your Honour, they get the earlier date. They get the overseas date as their resulting date under section 29(1).

KIRBY J: But the statutes are both reliant on a treaty. They are not reliant, as I understand them, upon matters of international concern, and your submissions touch but lightly on that and now you are sort of backing off from the Treaty because of the obvious difficulties in respect of the second statute to matters of international concern even though you do not ratify the Treaty.

MR BENNETT: I am not backing off, your Honour, I am just dealing with the first part first and the second part second. May I just finish international concern. It is of international concern that matters of this sort which are being done all over the world be capable of protection internationally and be able to get their priority dates and be able to be fast-tracked when they seek registration overseas and so on. It is a matter of international concern that the law in relation to this area be uniform because biological development and botanical development is a matter of worldwide interest and once something is invented it may be planted or propagated anywhere in the world. Matters of enforcement are matters of importance internationally.

McHUGH J: It seems to be a controversial subject and that is one of the things that concerns me a bit. Some powerful interest group gets its view on top in the international fora. Does it necessarily mean then that the Commonwealth can override very substantial bodies of opinion opposed to that in this country by linking itself by what has happened overseas? I mean, the Minister acknowledged that there is a lot of criticism of this legislation.

MR BENNETT: Your Honour, powerful bodies can influence State legislation too. That is hardly an objection to validity, with respect. But we would submit that at the end of the day, once a subject of this sort, a subject where there is an international reason for uniformity and an international reason for being able to operate the procedures internationally, then it becomes a matter of international concern. Once there is a Convention - - -

McHUGH J: I know, but just take this very area. My guess is that whether you favour it or not depends on whose ox is being gored. If you are a country with considerable expertise in technology, you are probably in favour. If you are a consumer-oriented society or, perhaps, an agrarian society, you have a different view about it.

MR BENNETT: Well, your Honour, no doubt a government has to weigh those factors as it weighs also the importance of encouraging innovation and development, and those matters are, no doubt, weighed and a decision is reached.

McHUGH J: No, but it seems an odd view that simply because at a particular point of time one interest group internationally gets on top, that that triggers Commonwealth legislative power.

MR BENNETT: But, your Honour, that power could be - - -

McHUGH J: It is not as if we are dealing with, say, race, or matters of that nature or even the environment, where there is, or seems to be, an almost universal view about matters and human rights.

MR BENNETT: Everything your Honour puts to me about race or human rights would have been said, and could have been said, 20, 30, 40 years ago to say against the result reached by this Court in Koowarta.

KIRBY J: Not quite, because as his Honour asked you earlier about the subject matter, these are things that of their nature inhere in human beings everywhere, whereas this plant variety is something of its subject nature perhaps a bit more limited.

MR BENNETT: It inheres in botanical structures everywhere, I suppose, but the other aspect is that the result your Honour is concerned about can be achieved equally by simply acceding to the Convention, and no one disputes that. So, what I am putting, really, is that there is no additional - - -

KIRBY J: Why should you not be kept to that, then? Why should that not be? In order to test the international concern, why should the Commonwealth not, with some provision for getting ready, be held to that, because it is already a very large power with a very great potential, and all you can suggest as a check on international concern is colourable agreement, which is a very difficult thing for a court to conclude. That is your only test; that is your only check, is it not? Everything is a matter of international concern today; virtually everything - police powers, things that are really potentially able to attack our federal structure, is of potential international concern. So you have to look for something that will put a check on it. Otherwise it just is not consistent with our Constitution.

MR BENNETT: Your Honour, one has a number of checks. One has the check of colourability. So, if one had something which by no stretch of the imagination, or by decision of this Court, simply was not and could not genuinely be a matter of international concern, there might be a question. But even there, once Australia acceded, one could do it. The question one has to ask is not what is the evil that flows from matters the subject of international conventions being matters of Commonwealth power, but what is the evil that flows from such matters being a matter of Commonwealth power prior to, or in the absence of, actual accession to the Convention.
That is the question.

McHUGH J: Yes, but you rely on statements in this Court that if there is a treaty that is the end of the matter, but the first statement of a legal principle is not the final statement of it and those statements were made in context of air safety, race, the environment. It may be that with other cases coming before the Court, and the courts having more experience of it, then perhaps some modification has to be made. The mere fact that the Commonwealth enters into a treaty does not necessarily mean that it can legislate to override or to increase its legislative power.

MR BENNETT: That issue probably does not arise in this case.

McHUGH J: No.

MR BENNETT: Patents were the subject of international conventions as early as 1883, so we know that intellectual property, or industrial property as it was then called, was seen as a matter of international concern well before the Constitution. So, this area is not one where that is involved. Also, I do not understand it to be put against me that if there is - - -

McHUGH J: No. Copyright, patents and so on have been the subject of international arrangements since well into the last century.

MR BENNETT: Yes, precisely, your Honour, and this subject matter was, as soon as it became an area. It is not put against me, of course, in this case, that once there is a treaty - leaving aside the timing issues - there is not federal power. The issue here is simply prior to the treaty.

I have dealt with the second aspect yesterday - I will not repeat myself on that - in relation to the Treaty one is about to sign, the Treaty which has the provision requiring conformity of laws and so on. The point in Richardson's Case - this is the Lemonthyme Forest case - was that certainly there was an existing Treaty but as yet no obligation, but one asks rhetorically: why is that not in the same category as the present case? There was no obligation under the Treaty in relation to the Lemonthyme Forest. It had not yet been declared but one was able under the incidental power to protect it in relation to the possibility. We submit that is squarely analogous.

KIRBY J: But where the statute is based on the Treaty and the Treaty has never been ratified and may as far as this Court knows never be ratified, you have both the statutory question but also the constitutional question.

MR BENNETT: Yes.

KIRBY J: If that is what is posited as the basis of the Federal Parliament's constitutional power and it has not attached, then why should this Court be struggling to find some other basis of constitutional power?

MR BENNETT: It is posited on a number of alternative bases which include that, yes. The patents power is the clear one obviously.

KIRBY J: No, but we are not in that area of discourse at the moment.

MR BENNETT: Under external affairs there are the two aspects, each of which is relied on.

GAUDRON J: There are also sections 5 and 10 in the respective Acts which say no rights are to be granted until the Convention comes into force.

MR BENNETT: That is the next thing I am coming to, your Honour. Perhaps I might move to that. My learned friends say, and particularly the Queensland submissions which are no longer relied on by Queensland but are relied on by Dr Griffith, that there are all sorts of things which these Acts do other than or prior to the actual making of a grant. They say all these things are not excluded or deferred by section 10. The short answer to that is that none of them are substantive, none of them matter.

The first one they rely on is the pre-grant rights which appear in sections 22 of the Variety Act and 39 of the Breeder's Act but each of those sections says that you cannot enforce any rights before grant until you get a grant. That is section 22(7) of the Variety Act and section 39(6) of the Breeder's Act. So, if you file an application, certainly you may be deemed for certain purposes to have a grant but the only purpose that matters is that if you ultimately get a grant, your damages relate back. That is all it does. You cannot get damages before you get your grant. You cannot even sue before you get your grant. You are not entitled to bring an action under section 39(6). So there is nothing there that assists my learned friends. It is simply a deeming for the purpose of calculation of damages once you get a grant.

Then they rely on a whole series of administrative matters. They say there is an office set up, people are employed, you make the application, you can answer requisitions, you can do all sorts of things prior to a grant, but that is just the incidental category of getting ready, I think Justice Gummow described it as yesterday. We would submit there is on any view of it nothing wrong with getting ready for something which is going to happen.

KIRBY J: You have been getting ready for this for an awful long time.

MR BENNETT: No, with respect, your Honour, the Treaty only came into force in 1998. People are talking about 1992. We could not go into it until 1995 until we had the Plant Breeder's Rights Act in force. I think the Act came into force in - it was assented to on 5 September 1994. I do not have the date in front of me, I will just have it looked up, but I think the date was 1995 when it was actually proclaimed. I will have that checked. I am sorry, 10 November 1994. So, we could not have acceded - - -

GUMMOW J: People forget it took the United States 80 years to join the Berne Convention.

MR BENNETT: Yes, precisely, your Honour. So, we could not have done it until November 1994, so we cannot count any period before then, and the Treaty itself does not come into force until 1998 and there were all sorts of reasons why one might not wish to be one of the original people who signs prior to it being in force. One does not need to speculate on those reasons. One can well imagine them. There could be all sorts of reasons why it is seen as in Australia's interests that one waits to see, or one wishes to confirm that one's trading partners have joined or one wishes to make joint arrangements, and other people to join, and so on.

KIRBY J: This is all speculation.

MR BENNETT: It is all speculation, yes.

KIRBY J: As far as we know, in the Councils of the Commonwealth, the decision had been made not to join this Treaty.

MR BENNETT: Yes, your Honour.

KIRBY J: And, yet, a statute of the Parliament is posited on membership of the Treaty.

MR BENNETT: Yes, your Honour.

KIRBY J: And, we are told, "Well, don't you worry about that, apart from the question of the patent's power. It still is enough. Because the fact that there is a treaty out there is enough, even though you have not joined it and maybe never will". So, it is slightly worrying - leave aside the patent power because we will test it. This Court has to test it by what would be the case if the only posited ground were the external affairs powers.

MR BENNETT: Yes, I understand that.

KIRBY J: And, if you are testing it by that it is a slightly worrying thing, given the potential of the external affairs power, to say, "Well, just the fact that there is a treaty out there gives it a matter of international concern and they will never join it. That gives the Commonwealth Parliament the power to intrude in areas which, absent the external affairs power, would be legitimately the areas of the States." It is a matter of concern. I am very sympathetic to international law but it is a matter of concern to me to posit constitutional power by connection with the external affairs power where you not both to join the Treaty.

MR BENNETT: Yes. All I was dealing with at the moment was the suggestion made to me that the lapse of time in some way indicates something or allows an inference to be drawn in relation to the likelihood or immediacy of Australia becoming a party to this Convention. It is an oversimplification to say, "It has been around all these years and we have not subscribed to it". There has not been a lot of time.

KIRBY J: What is wrong with the principle that says that where external affairs power is propounded on the basis of a treaty that it will only attach where the Commonwealth of Australia, on behalf of Australia, subscribes to the Treaty? What is wrong with that? That is a nice, clear, bright line. It is what Sir Anthony Mason seemed to be saying in that passage.

MR BENNETT: It creates problems with treaties such as this where one is supposed to have one's laws in order before one is allowed to accede.

KIRBY J: Yes, but we have had a solution. You cannot tell me that the Union would have said, "Look, we have got this peculiar Australian constitutional requirement. We cannot bring it into force but we have got it ready to go". You cannot tell me the Union would not say, "Well, that is bringing yourself within capability of bringing it into power" or whatever the words are.

MR BENNETT: In my submission, the line has always been wider than that because of the international concern aspect and the existence of an international convention, for the two reasons I have submitted, put one on the other side of that line. Of course, in relation to the Variety Act we know that Australia did subscribe very promptly. It was within 15 months, an incredibly short period.

KIRBY J: That makes the non-subscription to the present Convention all the more puzzling.

MR BENNETT: Your Honour, the present one did not come into force until 1998. I have to keep stressing that. That is in the materials. Now, finally on this aspect may I remind your Honours of what was said in the Industrial Relations Act Case, Victoria v The Commonwealth 187 CLR 416 where, at 483, the majority said this, in the quotation about two-thirds of the way down the page. The Court cited this passage with approval:

Thus, as long ago as 1936, Evatt and McTiernan JJ said:

"But it is not to be assumed that the legislative power over `external affairs' is limited to the execution of treaties or conventions; and...the Parliament may well be deemed competent to legislate for the carrying out of `recommendations' as well as the `draft international conventions' resolved upon by the International Labour Organisation or of other international recommendations or requests upon other subject matters of concern to Australia as a member of the family of nations."

Their Honours also said in that case:

"[A] consequence of the closer connection between the nations of the world (which has been partly brought about by the modern revolutions in communication) and of the recognition by the nations of a common interest in many matters affecting the social welfare of their peoples and of the necessity of co-operation among them in dealing with such matters, that it is no longer possible to assert that there is any subject matter which must necessarily be excluded from the list of possible subjects of international negotiation, international dispute or international agreement."

Now, your Honour, that was said as long ago as 1936 and was approved by five Justices of this Court three years ago and, in my respectful submission, that represents the current approach which should be taken in relation to the external affairs aspects of this case.

Finally, of course, the discussion is, in one sense, a discussion in vacuo because we have section 5 and section 10 and, for the reasons I have given, and I will deal with section 82 in a moment, the result of those sections is precisely what Justice Mason referred to and the other matters, the mere getting ready which I have referred to and the deeming of rights to relate back, is merely part of getting ready, is adjectival and squarely within the incidental power if nothing else.

KIRBY J: Is this subject to what you are going to tell us about section 82, because it grants - - -

MR BENNETT: Yes, your Honour. Yes, I am going to come to section 82. Now, the third of the four matters I need to deal with is Western Australia's argument about positive rights. I have provided some additional submissions to your Honours in answer to Western Australia.

Your Honours will be relieved to hear paragraphs 1 and 2 are introductory. I do not need to refer to those. Paragraphs 4 to 7 deal with the question of inconsistency and I will be dealing with those later today. Paragraphs 8 to 11 I have dealt with. The only paragraph I need to deal with now is paragraph 3 and the short point we make about paragraph 3 is this.

Let two propositions be assumed against me for the moment. Let it be assumed against me, first, that it is part of the law of patents, and always has been part of the law of patents, that no positive right is granted and that is what the cases say. Secondly, let it be assumed against me that this Act creates positive rights, these two Acts create positive rights.

GUMMOW J: What are they? What are they said to be?

MR BENNETT: A right to do what you can do anyway, your Honour.

GUMMOW J: Yes, that is what I am puzzled by them.

MR BENNETT: Yes, that is precisely the point, your Honour, which I am about to put. Let those two propositions be assumed against me which I need to assume to deal with the Western Australian argument. Now - - -

GUMMOW J: But what you could do anyway is subject to the ordinary legal system, subject to the Trade Practices Act, for example, for Part IV.

MR BENNETT: Yes. Your Honour, what Lord Herschell said in Steers v Rogers (1893) AC 232, which is the original case on this - Your Honours need not go to it - what Lord Herschell said in that case was precisely what Justice Gummow said to me a few minutes ago, not the last statement, but the one before that which is, "Well, of course, a patent does not give you the right to use, exploit and vend your product, because you could do that anyway if there was no patent; if you invent a process, you can just do it". Therefore, to suggest that a positive right is given would be to give you something you do not need. Therefore, although the statutes use the words "confer exclusive right to use, vend, sell" et cetera, it does not really mean that. What it means is we give you exclusivity in the general right you have to use, vend, sell, et cetera, and we construe the words that way not because it makes any difference, but because it is simply unnecessary to do anything else.

McHUGH J: But is that right? What the statute gives you is the right to exclude others from doing it.

MR BENNETT: Your Honour, the wording of the statutes, each of the statutes, is the right to, the exclusive right to do the following things, the slightly different wording, but from the Statute of Monopolies right down, ironically, with the possible exception of the 1882 English Act that was in force at the time of Lord Herschell's statement, but leave that aside, all the other Acts use a phrase which, as a matter of English, would have the other meaning.

McHUGH J: But it gives you rights as a matter of substance. If you did not have the Act, you could not exclude other peoples from making use of it. Because you have the Act, you are conferred the positive right to exclude others.

MR BENNETT: Your Honour, the point I am leading up to is this, that if the sole reason for construing the words and developing the legal principle which is repeated from time to time in dicta, although never as a matter of ratio, that a patent does not confer positive rights, if the sole reason one says that is, "Well, there is no point in giving you positive rights, because you can do it anyway. What we are giving you is the exclusivity", the difference between saying you are given the right to do it, although you can do it anyway, plus exclusivity, and saying, "Well, that right you have to do it anyway, we will confer exclusivity on", the difference between those two things is purely semantic and totally trivial and for that reason, one cannot say that, assuming those two things against me, assuming against me, first, that patents do not give positive rights, and secondly, that this legislation does, it is simply a trivial little difference that does not matter to anyone. It is certainly not something basic to the concept and the core of patent law as my learned friend from Western Australia suggest, and that, we submit, is the short answer to it, without having to go into the fascinating questions of positive and negative rights.

I will have something more to say about it when I get to inconsistency, but what we would ultimately be saying is whether that doctrine about no positive rights is correct or not correct in relation to patents, these Acts have exactly the same effect. In other words, if under patent law it is correct to say there are no positive rights given, the same applies under these Acts. If under the patents rights there are positive rights given, the same applies under these Acts. One cannot really escape that when one looks at the wording of the various things. For that reason, the argument cannot affect constitutional validity and I will deal with it more fully when I get to inconsistency.

Finally, section 82, and may I make five short points about section 82. This is section 82 of the Breeder's Act. It is one of the transitional provisions. What we submit is that it is a continuation of existing rights, rather than a grant of new ones. May I just make that good. First, your Honours will see it uses the words "those rights":

If:

(a) a person was granted plant variety rights.....

then, subject to the regulations, those rights have effect -

The phrase "those rights" also appears in 82(1)(b) in the other condition:

If:

(a) a person was granted plant variety rights.....

(b) those rights were still in force.....

those rights have effect -

so, what it is, is one's previous rights. Those rights are then modified by - and this is the second point - by the words "as if". The words "as if" are deeming words. One simply deems them for the purpose of enforcement, or treats them as if they were rights of another kind, but it is the old rights which are continued.

When one then goes to section 10, all section 10 does is prevent the "granting of" breeder's rights "in a plant variety". There is no grant under this Act of anything, under section 82. There is merely the continuation of existing rights with a variation.

KIRBY J: But it is continuation by force of this Act?

MR BENNETT: Yes.

KIRBY J: So this Act has to be a valid Act.

MR BENNETT: Yes, your Honour. If the Variety Act is valid, it is valid to alter the rights under it. One does not need to follow, precisely, the wording of the existing Treaty in every respect, and it is open, particularly where there have been - this is a much smaller step than the other one. All one is doing here is saying there is an existing Treaty, and an Act which brings that Treaty into effect. We have rights under that. The International Convention has now said there is going to be a new Convention. We are simply altering the existing rights under that Treaty to comply with the new Convention and give them the additional rights, the wider rights which now flow to them.

But it is done simply as a variation. It is rather like, I hesitate to say, the case your Honours will be dealing with next month in Barnes' Case where there are alterations to existing awards under the Industrial Arbitration Act. Once one has power to do something, one generally has power to alter it. It is like the Hindmarsh Bridge Case - I have forgotten the name - Wilson, I think it was.

KIRBY J: Kartinyeri.

McHUGH J: Kartinyeri v The Commonwealth.

MR BENNETT: Yes.

GAUDRON J: Well, that depends, does it not? I mean, the test is really whether they are appropriate and adapted to the former treaty to which Australia was a party. When you are in the area of implementing a treaty, to test whether it is in fact a law with respect to external affairs, you see whether or not it is appropriate and adapted to the treaty in question. So, your modification is not at large, whereas, if you are under another head of power it may well be.

MR BENNETT: Yes, but, your Honour, once there is a treaty there is no question the area is one of international concern and - - -

GAUDRON J: Yes, but I do not think the decisions of this Court have gone so far as to say - in fact, I think quite the contrary. I think they have raised the possibility that there may well be difficulties in justifying the law as a matter with respect to external affairs on the basis of concern, when it is not appropriate and adapted to a multilateral treaty. Do not forget, in this area one is always about characterising the law. Now, prima facie, it is not a law with respect to any of the other heads of - leave aside in patents - but, ordinarily, a law that is justified under the external affairs is not one that is referable to any other.

You test whether it is a law with respect to external affairs where there is a treaty by saying is it appropriate or adapted to that treaty. If it is not, prima facie, it is not a law with respect to external affairs. The Commonwealth would have to say, "Look, it is a matter of international concern for us to legislate A, B and C, when the treaty says not A, not B and not C".

MR BENNETT: Yes, I follow the point. There are two matters we would put. First - and I do not want to address your Honour on the detail because I am very conscious of the time, but when your Honour goes through the differences we would say they are not as great as our learned friend's choose to characterise them as and each of the major differences is removed by section 82(2), (3) and (4) so all that is left are the minor differences.

GAUDRON J: And you say they do not come into force in any event until the Convention comes into force?

MR BENNETT: Precisely, your Honour, and 82(2), (3) and (4) say - 82(2) deals with the different length of time for which the grant lasts; 82(3) deals with "dependent plant varieties" and 82(4) deals with "derived" varieties. So, those were the three main differences and each of those is excluded from the conversion process, if one likes. That is the first point. The other differences are fairly minor differences and your Honours will see them and you can look at the two treaties. The second matter to note is that - - -

GAUDRON J: Of course, in this area, if I could just take you back to interrupt you again, I am sorry - of course, you do have a basis for saying "international concern" once you have a new Convention, even though Australia is not party to it, which says rights under the old Convention are to be treated as rights under the new Convention.

MR BENNETT: Yes, precisely, and may I just add to that even further: Justice Kirby's suggestion is that there it is convenient to have a bright line and to say execution of a treaty is a bright line. You are all right on one side and not on the other. But one could not get much closer to the other side of that bright line than this one where one has a treaty and a corresponding Act, one has negotiations by the international body for a variation to the Treaty and we pass an Act providing for that variation prior to acceding to the amendment to the Treaty.

KIRBY J: To which we may never accede.

MR BENNETT: To which we may, theoretically, never accede. Now that, I submit, is a tiny step across the line that Justice Kirby wants to draw and we would respectfully submit, we say you do not draw the line at all but if one is drawing anything more diffuse that is a very easy one and for the reason your Honour Justice Gaudron puts to me this is a case where, on any view of it, there is international concern by the very parties, or some of them, to the Treaty which is being considered.

My learned friend has submitted that it is a - this is the third point- that it is a totally new Convention. I do not want to spend time debating that arguable proposition except to say that we would submit that Article 3(1) rather suggests that it is not. That provides that:

Each Contracting Party which is bound by the -

earlier Acts -

shall apply the provisions of this Convention -

on particular dates, which rather suggests that it is seen as something which will be a development or supersession of it.

The fourth point was the three major differences in section 82. I have taken your Honours to that. Finally - and this is the last point - my learned friend submitted that the effect of the repeal in section 78 of the Breeder's Act is that the Plant Variety Rights Act is dead, to use his picturesque phrase. The transitional provisions are such that it is a long way from dead. May I just show your Honours very quickly. Section 80(2)(e) gives a general power to the Governor-General to make "transitional and saving" regulations. We stress the word "saving" so as to avoid any transitional problems between the two Acts. Section 82 itself of course is a major transitional provision. I have dealt with that.

Sections 83, 84, 85 and 86 are all transitional provisions which enable matters at various stages under the old legislation to be continued. So we would submit if that is what is meant by "dead", it is a long way from ultimate destruction.

GUMMOW J: Do you say, Mr Solicitor, that Part 9 exhausts what would otherwise be the application of the Interpretation Act, section 8?

MR BENNETT: I am sorry, I did not follow the question. Part 9 is the transitional - - -

GUMMOW J: Yes, but that is an exhaustive statement so as to exclude what otherwise would be the operation of section 8 of the Acts Interpretation Act?

MR BENNETT: I am sorry.

GUMMOW J: There is a case, one of the Smirnoff Vodka Cases [1962] HCA 66; 109 CLR 153 where that was said to be so in relation to the 1955 Trade Marks Act.

MR BENNETT: I only hesitate to give a positive answer to your Honour's question because of the possibility that there would be some aspect of section 8 which still remains.

GUMMOW J: That is what one wonders.

GAUDRON J: I suppose were it the case that Part 9 were invalid for one or other of the reasons assigned by Dr Griffith, you would pick up section 8?

MR BENNETT: Yes, there probably would still be a residual operation for section 8.

GUMMOW J: So the rights that you had under the Plant Variety Act would then be protected under section 8(c) of the Acts Interpretation Act.

MR BENNETT: I think they are already substantially protected by section 82, of course.

GUMMOW J: Yes, but if that were invalid.

MR BENNETT: If that were invalid, section 8 would certainly give the - I am sorry, if that was the purport of your Honour's question - - -

GUMMOW J: No, it had two strains to it.

MR BENNETT: Certainly if any of this was invalid, we would rely on section 8, yes. Secondly, it may well be that the field covered by these sections is such that there is still room for aspects of section 8 to operate. I have not gone through section 8 to analyse if that is the case. Subject to that, I would give your Honour a positive answer to the question. May it please the Court.

GLEESON CJ: Thank you. Yes, Mr Gray.

MR GRAY: May it please the Court, the Court has two written submissions from us. Our primary submission is at page 83 of the Questions Reserved Book and we have filed a separate supplementary submission in response to the Western Australian submission. Our primary argument is, and remains, that the Acts, the Variety Act and the Breeder's Act, are supported by the patents power. We do not propose, in view of the detailed debate that has taken place and the detailed written submissions, to advance oral submissions to further that matter. Rather, we would prefer to use our time to concentrate on some discrete aspects of the external affairs power.

Now, if the Court pleases, in the question of the reserve book, at the end of our written submission there is a chronology - - -

KIRBY J: Could I just ask you this to get this clear. In relation to the patents power, is there any provision in the Act which is relevant to this case which would not be supported by the patent power which would separately depend upon the external affairs power or can it be taken that if the patents power supports the Act that the Court is not obliged to examine the external affairs power?

MR GRAY: Yes, that latter proposition is our position.

KIRBY J: Do you understand that to be a common ground between all parties? I ought to have asked this earlier.

MR GRAY: Yes, we do, if the Court pleases.

KIRBY J: Yes.

MR GRAY: If the Court pleases, in the chronology that is behind our written submission the Court will see that, in essence, that forms a very brief resume of agreed facts because each aspect of the chronology is linked back to what has been agreed or admitted on the pleadings. For relevant purposes I wanted just to start with just identifying one matter that has already been covered, that is that grant Tasmania followed Australia's joining as a party to the Convention which, of course, followed in point of time the Variety Act. Now, if the Court pleases, we put a different construction to section 5(b) of the Variety Act that is otherwise put and the argument runs this way, that section 5(b) speaks of Australia becoming "a party to the Convention".

We just underscore "party" as distinct from "bound" and "the Convention". "The Convention" is defined as being the International Convention and, more particularly, the English text of which appears in the schedule. There is only one International Convention, that is, the 1961 International Convention, UPOV, as it is called, which has undergone various revisions. When one looks at the schedule to the 1987 Act one has the text of the 78 revision of UPOV. That is in the book of documents at page 66. The Court will see there that the Convention is entitled:

International Convention for the Protection of New Varieties of Plants of December 2, 1961 -

That is the International Convention, and then it is:

as revised at Geneva on November 10, 1972, and on October 23, 1978 -

In the top right-and corner there is a note taking the reader back to the definition. So, "the Convention" in section 5(b) is the International Convention and Australia has and remains a party to that Convention.

That convention has been further revised by the Act of 1991. Australia remains a party to the Convention but not bound by that revision. Now, if that construction be correct, section 5(b) was met when Australia joined the treaty in 1989 and equally we come to section 10(a), if that construction be correct - I will take the Court through the parallel provisions in 10(a) - Australia, at the time of 1994 Breeder's Act, was a party to the Convention but it was not bound by the 1991 revision. Now, if the Court goes to the 1994 Act in this book, and now turning to page - first of all, I could start with 10(a), the Court will see that identical language to 5(b) is being used, that is, Australia joining - becoming a party to the Convention.

HAYNE J: And that is a defined term.

MR GRAY: That is a defined term in identical text. That is, it means the International Convention and then the English text of which appears, the schedule. The English text that appears is the 1961 Convention as revised to 1991. So, the text, the English text, differs, but the Convention remains the one Convention. Now, as a matter of terminology, others have spoken of a 1978 Convention and a 1991 Convention and we say therein lies a distinct area of confusion. The correct terminology is there is but one International Convention, UPOV, 1961, as revised.

HAYNE J: You say there is one Convention as a matter of international law, the question is whether, as a matter of statutory construction, there are two separate instruments, if that can be used neutrally, to which reference is to be made. The question is a point of statutory construction, not one of international law relevantly, is it not?

MR GRAY: Yes, if the Court pleases, our first submission is that because of the definition as being the International Convention, as a matter of statute, the domestic statute is referring to UPOV as revised. If there be ambiguity there is very good reason to favour the construction we contend for because if one does not, and if my learned friends are right, and the 1994 Act is invalid and the 1978 Act has been repealed or is invalid, it would mean that Australia would be unable to meet its obligations to the Convention to which it is a party and bound. Because under the Convention that Australia is a party to and bound by, it has agreed, in its domestic environment, to ensure and maintain variety rights.

So, the consequence of my learned friend's argument would be a construction of the Act that would make Australia unable to meet that obligation under an existing Convention to which Australia is bound and we would say that that would not have been intended by Parliament. So, if there be ambiguity - - -

KIRBY J: It is pretty hard to put this argument, though, as a matter of statutory construction of our statute, given the schedule and what is annexed to this statute of the Australian Parliament.

MR GRAY: Yes, but the point that.....with international law is that the consequence of what we would say would be the narrow construction, the construction that we contend against, the consequence of that construction would be to leave Australia unable to meet its international obligations under the Convention to which it is a party and bound.

GLEESON CJ: This may be of some particular significance in relation to section 82.

MR GRAY: Yes. If the Court pleases, when one comes, if I might just briefly, to the schedule to the 1994 Act, the Court there has the 1991 version. One turns first to page 130 where the Court will see that as with the earlier schedule to the 87 Act, again the Convention is being described, not as the 91 Convention, the Convention is being described as the "International Convention" of 1961, as revised 1972, 1978 and 1991. When one then moves internally into the 91 Act, at page 132, the Court will see there is a careful delineation between what is described as "this Convention" and the Convention:

"this Convention" means the present (1991) Act of the International Convention -

By contrast, the International Convention is picked up under (ii) being:

"Act of 1961/1972" -

So, it is:

the International Convention for the Protection of New Varieties of Plants of December 2, 1961 -

Later in the body of the Convention there is a distinction drawn between "this Convention" and "the Convention". At page 147, Article 31:

Relations Between Contracting Parties and States Bound by Earlier Acts -

So, Acts:

bound both by this Convention and any earlier Act of the Convention -

We would say that that distinction has been blurred in the treatments been put thus far to the Court, and we would invite the Court to construe 5(b) and 10(a) as referring to "the Convention" being the International Convention of which Australia is and remains a party, and of which Australia is and remains a member of the Union with obligations, and most importantly, obligations to ensure and maintain breeder's rights. If the Court were to turn to - just to illustrate that - Article 1 of the 1978 revision, which is at page 67, the Court will see:

The purpose of this Convention is to recognise and to ensure to the breeder -

et cetera. If I might just jump ahead for a moment, the reason why an intending party to the Convention had to deposit its laws before being admitted as a party was, under the Convention it was then to join, it had immediate obligations to, mandatory obligations, to give breeder's rights in its domestic territory.

So that, of course, is the rationale behind the need to have the law in place before joinder was allowed. So we would put those submissions in regard to that aspect of the matter. If that were to be right, that would clear away many of the other arguments that have been put to the Court. We would say such an interpretation of Australia being a party to the Convention, but bound by some only of its terms would be consistent and in accord with the international treatment of these matters.

Might I just go to one other complexity. This Convention is, in a sense, a little unusual to that that has been dealt with by this Court before. We have many parties to it, now some 44, and they are bound by various versions of the International Convention, and so as between themselves there are reciprocal rights, but they are of a different nature, country to country, depending on what particular version of the International Convention, what particular revision, they have become party to and bound by. Behind our supplementary submission as Table 1, the Court will find a work sheet which is designed to illustrate the way in which, as examples, those different arrangements work and the way in which Australia as a party and bound by the International Convention, and in particular the 1978 revision, the way it would have ongoing obligations today in regard to not only those other members States, but also too nationals of those member States. I had not proposed to do more than draw the Court's attention to that. No doubt, other examples abound.

KIRBY J: What do you make out of these disparities?

MR GRAY: That simply illustrates, if the Court pleases, that Australia remains a party to the International Convention, it remains obliged under the Convention to which it is bound to accord breeder's rights within its territory, both to its nationals and foreign nationals. One of the consisted articles through these versions of the International Convention require each member State to treat foreign nationals on the same basis as its nationals, and, in particular, to allow a foreign national to elect whether they seek their grant of rights in Australia or elsewhere.

So, if I might then, perhaps, just retrace my steps for a moment: once one accepts that that is the nature of the international obligations that Australia has, the contentions put against us would leave, if they are right - and these Acts, including section 82, are invalid - Australia unable to meet its obligations today.

Now, could I, against that background, turn to the section that principally concerns my client, which, of course, is section 82. My client's rights, of course, now are section 82 rights. They have, of course, their origins in the Varieties Act. Now, in regard to section 82 we did wish to draw one matter to the Court's attention that had not received emphasis so far. It is at page 129 of the book. It is the words in section 82(1)(b) and it is the words:

then, subject to the regulations, those rights have effect, despite the repeal of the old Act -

So, that the repeal - - -

KIRBY J: What page is this provision of the statute?

MR GRAY: It is at page 129 in the book, and it is at line 29 on that page.

KIRBY J: Thank you.

MR GRAY: It is the words:

despite the repeal of the old Act -

we would emphasis because what that does is, of course, to qualify section 78. This is not an absolute repeal. There has been a saving, and we, with respect, would suggest, in a submission put to the contrary, that this was an absolute repeal, unqualified in any way, is not correct. It is plain and we would say that those words support the argument that there has been a continuation of the 1987 Act to that effect and, in particular - - -

KIRBY J: But the problem is the words "as if" and then the two clauses that follow which can only be given meaning on the assumption of the valid existence of the 1994 Act. They cannot have any meaning outside that because there is no PBR in the earlier Act.

MR GRAY: Yes. Well, we would agree with the submission put by Mr Bennett that in fact when one looks at the rights in the two Acts, and in particular the exceptions that later appear, that we are not talking about anything that is any different in any substantive way. We would join issue with the submission that has been put that there is some material difference between the 1987 rights and the 1994 rights.

KIRBY J: I thought those schedules that you just showed us indicated that there were lots of little differences.

MR GRAY: There are lots of little differences but on the core issues, that is, the granting and maintaining of rights, the dealing with foreign nationals on the same basis as Australian nationals, the nature of the rights beings protected, yes, the matter has been refined, yes, it is more sophisticated, but in essence it is the same.

KIRBY J: Yes, but the problem is that subclause (d) does not draw a distinction between essential rights or integral rights or chief rights, it is just PBR and that is a reference to the new Act in which it appears.

MR GRAY: Yes. If the Court pleases, this is a matter of a comparison of the sections and obviously time does not permit that in oral debate, but we have prepared tables 2 and 3 to our supplementary submission. We hope it will be a useful guide in that task because they translate or link to various provisions in the Conventions and the Acts.

It is not comprehensive and as being absolutely complete, but it will enable the Court to work through and compare, and to read, and in support of our submission that, in substantive terms in regard to core matters, there has been a consistency. In fact, if one looks at the International Convention, its revisions, one finds that what is happening is there is being spelt out in clear words what was implicit before. For example, in the 1978 version it is made clear that member States can protect the public interest and in the 1991 revision that is spelt out in regard to, for example, experimental work.

GLEESON CJ: In the materials that we have, is there anywhere we can find a rationale of the latest revision of this Convention?

MR GRAY: No. There are publications by the International Convention itself. They are public, they are on its home page, and they would certainly provide information on that and we would be in a position to provide that to the Court if that would assist. That is publicly general information from the Convention itself.

GLEESON CJ: I just wondered if there were some compendious analysis of the difference between the provisions of the unrevised Convention and the revised Convention and the reason for those differences.

MR GRAY: No, the answer is no. In terms of a comparison, the nearest thing the Court has are our tables 2 and 3 that would allow one to read it, but the matter has not been, and the rationale behind those revisions are not before the Court. There is an article by a well-named author, Mr Millett, in this area, published in a Sweet & Maxwell production, which we can provide to the Court - - -

GUMMOW J: I think we have it.

MR GRAY: Yes, I think that has been made available and that does, in a general way, deal with the history of UPOV and it does address the matter your Honour the Chief Justice has raised. It explains, if the Court pleases, that there was seen to be a need for what is described as significant change between the 1978 revision and the 1991 revision but on page - - -

HAYNE J: What is the journal this is taken from, Mr Gray?

MR GRAY: I think it is Environmental Law Review, I think is its title, but it has been quite difficult to access and hence the rather poor copy. There is another article that I could provide to the Court by, on this occasion, the well-known author, Mr Greengrass, so Millett and Greengrass have been the authors in this area, but if the Court - - -

MR GRIFFITH: Your Honour, could I indicate that we have not had a chance to see this material and given the objections articulated yesterday with respect to just producing copies, we would wish to maintain our position that this material was not before the Court for the purpose that my learned friend is using it.

GLEESON CJ: Yes, we have noted that, Dr Griffith, yes.

MR GRAY: We accept there is a limitation. On this occasion it is a published text in a recognised journal. The Court can have some regard to it but it is obviously limited.

KIRBY J: Do you understand that objection to go to Mr Millet's essay as well as the one that you were about to hand up?

MR GRAY: We understand my friend takes objection to Millet. The other publication - - -

KIRBY J: His objection was he has not had a chance to read it yet. I think if he does read it and finds that we can read the material as background material, it appears in a reputable journal, then I think that we should be informed of that. Has any progress been made on the matter that Justice Gummow and I raised yesterday concerning a factual background statement and a statement of the matters which are admitted on the pleadings?

MR GRAY: Yes. Could I indicate to your Honour that has been prepared and, I understand, before being handed to your Honour, that it is agreed and I might say that in A11 we have prepared an agreement there with Western Australia as to the facts and the documents and your Honour should have the A11 book as well.

KIRBY J: Thank you.

MR GRAY: Your Honours have the document of A11. I understand that in P34 it is yet to be handed up. There is a short agreement there. I think that, by and large, they cover the same ground.

KIRBY J: Does that cover the interesting actual circumstances in which this dispute arises, that I first got a glimpse of in the Tasmanian submissions.

MR GRAY: Yes, the correspondence and the history of that will indicate the way in which the problem has arisen and I might say, just whilst leaving the argument proper, that in regard to Professor Lazenby's work, we cannot agree those factual matters that are identified there. Our instructions do not permit that in so far as parts of it have been utilised in the second reading speech. Of course, that is available to the Court in the usual way.

KIRBY J: But it did seem to be demonstrated that it was part of the historical background to the consideration by the government of the preparation of legislation and the steps that led to the introduction of legislation by the government of the day.

MR GRAY: Yes, that part which is taken in and used but there are other parts of the Professor's paper that may have had no relevance at all so we would say the Court is restricted to what has been dealt with at the second reading speech stage.

GLEESON CJ: The answer to the question that I originally asked, I think, is probably found at pages 233 and 234 of Mr Millett's article which is simply a summary statement of something that, presumably, with sufficient time and diligence, we could work out for ourselves.

MR GRAY: Yes, your Honour, we would respectfully suggest that is a very helpful thumbnail sketch of the rationale. It does talk about deep changes but they are then described and the changes are evident. One, for example, is whether member countries would be able to offer to applicants for a grant either patent protection, for example, and variety protection because, for a while, for example in the European countries, there was a forbidding of any rights to be maintained. So, we would say that they relate to matters of manner of approach to protection rather than the core matters being protected so when we look at the rights that are being protected - I will come to that in more detail in a moment - the core rights remain the same through all revisions.

KIRBY J: So the bottom line is you want us to roam unrestrained in Mr Millett but to have great restraint in Professor Lazenby.

MR GRAY: Well, yes. The difference, if the Court pleases, is that Mr Millett's article has undergone, as it were, the usual peer process for publication in a reputable journal and available for, as it were, public comment and has that status whereas - - -

KIRBY J: Professor Lazenby was a very distinguished scientist.

MR GRAY: If the Court pleases. So that is as far as I can go to meet your Honour the Chief Justice's question but we would suggest that Mr Millett's article, if the Court is able to act on it, might provide some useful background and information.

I might say that the search for other texts in this area apart from the UPOV home page material in their publications has not thrown up much of assistance. There is a short article by Mr Greengrass that I could make available to the Court if there was no objection and the Court would be assisted.

Could I turn to another aspect of section 82. We would submit that section 82 is fully supported by, in any event, the International Convention as revised to 1978. This involves the Court finding that it is a reasonable adaption of that revision.

GAUDRON J: I wonder if it does. Let us assume the rights go a little bit further than the 1978 ones. Whether they do or not I do not know for the moment, but assume they do but they go no further than the 1991 Act. What one is really doing in this exercise is seeing whether the Act is appropriately characterised as legislation with respect to external affairs. If you see it has its primary basis in a convention by which Australia is bound, as you say it does by reference to those rights, and any variations on them are referable to an international instrument which, although Australia is not bound by, it nonetheless is referable to it and in a context where international property rights have been the subject of international treaties for some time, why would you not say yes, in these circumstances you can characterise it as a law with respect to external affairs anyway?

MR GRAY: That, with respect, is our primary submission. At paragraph 4.14 of our written submission we have taken the position that this is an international affair relevant to make it an external affair per se. We have developed that submission in writing as an explicit position we take.

GUMMOW J: What paragraph number was that, Mr Gray?

MR GRAY: Paragraphs 4.14 to 4.18, I think. That is where we develop that. It really starts at 4.13 and continues through and it is also touched on in our supplementary submission. If that submission be correct, then section 82 would be sustained. But we were going to put a slightly narrower more specific submission in these terms, your Honour, and it is this: that under the International Convention, as revised to 1978, there are two relevant features.

The first is that Australia had the obligation to ensure and maintain and it has that obligation today, and 82 is doing just that, it is maintaining what has occurred, and we might say maintaining both in regard to Australian nationals and foreign nationals who have accessed the Australian system. So we would say we come directly within a reasonable adaption of Article 1. But secondly, what the International Convention does is to require member states to guarantee, as it were, a minimum level of protection that explicitly leaves it free for them to, as it were, enhance that.

KIRBY J: The Commonwealth could have done it by reserving completely the variety rights instead of repealing the old Act. But instead of that, it repeals the old Act, enacts a new one, but purports to rest it upon these two heads of power, and in the one that we are talking about, it has the problem that it has never ratified the Convention.

MR GRAY: Yes.

KIRBY J: I mean, your theory is that there is no check, except colourability, which is a very difficult thing for a court to use as a check.

MR GRAY: Yes, we would say that, from my client's perspective section 10 which identified two heads of power was conditioned on the grant of rights. It was not dealing with the head of power, the Act, per se and that from our perspective we would support it as an external affair because at the time the 1994 Act was entered into, relevantly, Australia had been an observer in 1978, which is a distinct status, and obviously had an interest before that, and that it then developed that interest, becoming a party, and it remains a party in 1994. So that if one is looking for an external affair that Australia has an international matter - a legitimate external affair, we would say that those facts speak very strongly of it and that, as it were, one is a little deflected by seeing 10(a) and (b) refer to two particular heads of power, but we would say that is limited to a condition in respect of the matter of grant. The reason why the word "if" appears, the matter just touched on the Court yesterday, that one has to anticipate that Australia might withdraw from this Convention at some time and so - - -

GUMMOW J: But we have never withdrawn from the first Convention.

MR GRAY: No.

GUMMOW J: That is your point.

MR GRAY: Withdraw from the International Convention - - -

GUMMOW J: Yes

MR GRAY: - - - at some time, and so that would give - - -

GUMMOW J: But we never have.

MR GRAY: I am sorry, your Honour?

GUMMOW J: We have never withdrawn from the first Convention.

MR GRAY: No.

KIRBY J: You say from "the" Convention, "the", the definite article.

MR GRAY: Yes. We would say yes, indeed, and viewed in that way, if the Court pleases, the word "if", which I think is in place of the word "were" in 5(b), is to cover the possibility that at a point of time in the future, Australia ceases to be a party to the Convention in any of its revisions, and at that point, section 10(b) would then operate, but it would allow existing rights to continue on under the Act. It would not allow for further grants.

Could I take a moment just to indicate, hopefully in very short form, some of what we have....as critical elements of the International Conventions in regard to particular topics. For example, the International Convention, in its various revisions, all of them, has an obligation to accord the same treatment to nationals of member states as to their own nationals. That is UPOV 61 Article 3, 78 Revision Article 3, 91 Revision Article 4. That core obligation continues throughout. Another is to ensure that rights to a minimum standard are granted in regard to development of new plant varieties.

GLEESON CJ: Could I ask you about another aspect of the Convention that appears from Article 2 which we see on page 67 of the materials, under the heading "Forms of Protection". It distinguishes between what it calls "special title of protection" and patents, and contains a particular provision as to the way in which member states can deal with that question. What, if any, significance does that distinction have for your primary argument based on section 51(xviii)? I presume that what Australia chose to do was to grant a special type of protection rather than a patent?

MR GRAY: Yes, that is so, but Australia did not preclude its nationals from applying for a patent.

GLEESON CJ: Does the fact that the Convention distinguishes between a special title of protection and a patent have any bearing on the argument based on (xviii)?

MR GRAY: We would answer that in this way, your Honour: the Convention was anticipating many members, and it was wishing to, as is often the case in the case of inventions, multiparty ones, select a form of words that would allow member states to then deal with the matter according to their own constitutional requirements.

Could I just deal with the other couple of examples, what we say are core requirements. The minimum standard requirement UPOV 61 Article 5, 78 Revision Article 5, 91 Revision Article 14. Another, to ensure that the rights are granted on the satisfaction of particular conditions, or this is about the uniformity that is spoken of as being one of the aims; it is UPOV Article 6, 78 Revision Article 6, 91 Revision Articles 5 and 9.

As the Court reflects on these documents, and in particular by use of the tables 2 and 3 we have provided, one can take topics and see the consistent treatment of core topics, and see the differences. What one sees is a developing sophistication and complexity in the matter as the core matters are better defined, as time has allowed for that in the interests of these many nations.

When one then goes to the Variety Act and the Breeder's Act, one can see that those important elements each are taken to the two Acts. To give the Court an example, the obligation to a Court to foreign nationals, the rights of members of nationals member State is section 24 of the Breeder's Act and section 15 of the Plant Variety Act. Again, the examples abound. One of the changes that has come through over time in this continuum of this International Convention has been an extending of the period during which grants are to operate. As time has gone by the term of the grant has been extended, and, in particular, that then has adopted a reflection, for example, in the 1994 Act allowing a further five years. But, they are, we would say, not matters going to the core issue, they are simply refining the core issues.

They are the submissions we put in regard to those aspects of the matter and if I might just conclude on section 82 that when one analyses it the core rights mean the same and 82 is justifiable and supported by an external affair, in generality, but one can come back to the particular and anchor it to the provisions at the 1978 revision.

Now, if the Court pleases, could I just perhaps conclude in a sense with a summary, but just wishing to underscore the very special nature of the issue before the Court and the critical points are as follows: the 1991 revision is a revision of UPOV Convention to which Australia remains a party; that the fundamental obligations and objects remain the same; that Australia is a member of one Union created by the UPOV Convention in its original form; that Australia has obligations to other members, irrespective of what version of the Convention they are a party to.

The various revisions of the Convention remain in force with different member states obligated to different versions and that represents, on our researches, a unique situation as far as this Court has had to deal with when considering the external affairs power. May it please the Court.

GLEESON CJ: Thank you. Yes, Mr Solicitor for Tasmania.

MR BALE: May it please the Court, we adopt the submissions in the alternative, where necessary, of the defendants and by doing so I hope that our submission can be curtailed, certainly time wise, and for economy of time I would propose trying to avoid referencing in the submissions, certainly in terms of reading them, extracts from the authorities which are referred to in our written submission and instead confine myself to putting a number of the in principle propositions in relation to the somewhat different approach which our written submission takes to the issues of patents power and the external powers to those that have been addressed by others.

Could I be permitted, before I do that, one small piece of housekeeping, and that is in paragraph 28 of our written submission? Your Honours will see in the second-last line there is a reference to sections 11 and 12 of the Breeder's Act - it should properly be a reference to sections 12 and 13 of the Breeder's Act. If I may first deal with the patents power, the essential question, in our contention, is whether the Variety Act and the Breeder's Act, or either of them, are Acts with respect to patents of inventions within the meaning of section 51(xviii) of the Constitution.

As this Court indicated in the NRDC Case, to be such Acts they must provide for the conferral of rights in the nature of patent rights according to the principles which have been developed for the application of section 6 of the Statute of Monopolies. That, of course, is not to say that we need to go back to Federation concepts of the meaning of section 6 of the Statute of Monopolies. As the Court there said, the principles which have been developed for the interpretation of section 6, and as I understand it, that means that all the principles that have developed until present day.

Now, the Grain Pool, and those who support it, say that the Acts do not confer rights of that nature because, they say, three of the requirements which have been established over time for the interpretation of section 6 of the Statute of Monopolies are not met in the Acts, and they are, firstly, that the Acts do not require that a plant variety, in respect of which rights may be granted, is an invention. They say, secondly, that the Acts do not relevantly require novelty, and they say, thirdly, that the Acts do not relevantly require exclusivity.

Our contention is that there is, in fact, a requirement in those Acts for all of those things because sections 5 and 10 provide that rights may only be granted in respect of a plant variety if the origination, if we are dealing with the Variety Act, or the breeding if we are dealing with the Breeder's Act, of that variety, constitute an invention within the meaning of section 51(xviii). By so providing, we say that these sections require that all the elements which section 6 of the Statute of Monopolies requires, or is at least now regarded as requiring, are to be included, and that includes inventiveness, and it includes novelty.

GLEESON CJ: Does section 5 of the Act of 1987 mean that where Australia is a party to the Convention, the requirement in paragraph (a) does not operate?

MR BALE: Yes, your Honour, so all I am concerned, in this submission, of course, is the requirements of patents. I am not addressing yet the external affairs power but that is what, in our contention, it means. Unless one of those two positions operate, you cannot grant a right under the Act.

GLEESON CJ: Yes, but does it also mean that provided the second of those two conditions is satisfied, you can disregard the first?

MR BALE: Yes.

KIRBY J: Do you understand that to be common ground of all parties?

MR BALE: I believe so, your Honour. It certainly does not seem to be contended otherwise in any of the submissions that have been made, either written or oral and so it is our contention that once those elements of obviousness, novelty and so on are shown to exist as a matter of fact, then, but only then, does either of the Acts allow for the granting of a statutory right.

GLEESON CJ: Unless Australia is a party to the Convention.

MR BALE: Yes, leaving aside, for the moment, the external affairs power, your Honour, but in so far as the Act depends, for its validity, upon the patents power.

GLEESON CJ: According to that article of Mr Millett's there was a large issue at one stage about whether States should be permitted to give patent protection to plant varieties and the European community actually imposed a ban on that.

MR BALE: I believe, your Honour, that that clearly has been overtaken by events which have followed and of the 44, I believe it is, countries which are now members of the UPOV. My understanding would be that the bulk of them have conferred rights in the nature of patent rights. I am not in a position to give your Honours a table showing the extent to which patent ability exists and the extent to which special rights exist. That could be provided if it were helpful.

GLEESON CJ: Is it your submission that the rights that are conferred under the 1987 Act are rights in the nature of patent rights?

MR BALE: Yes, your Honour, because they possess all the characteristics and necessarily possess all the characteristics, in our submission, because they are required, so far as the patents power is relied upon, to depend upon invention and invention of a new plant variety under the Plant Variety Act and if you have invention and you have a new product as a result of invention, then, in our contention, you necessarily have all of the elements of a patent and, therefore, the right that is granted in consequence is in the nature of a patent right.

GLEESON CJ: Does that requirement of invention stem from anything else in the Act except section 5(a)?

MR BALE: No, it does not, your Honour, nor section 10(b) so far as the Plant Breeder's Rights Act is concerned. The plaintiff then argued that section 5 and section 10 require invention only in the origination or breeding of a plant variety as distinct from invention in the variety itself, whereas the rights which the Acts purport to confer were rights not in relation to origination or breeding but rather in relation to the product of the process, that is a new plant variety.

In our submission, that distinction is not a sound one because, as I suggested in response to your Honour the Chief Justice a moment ago, if there is an invention in the origination or breeding of a plant variety and that invention produces a new plant variety, then there is a new plant variety by invention. That is to say there is a new plant variety which is of necessity an invention in the relevant sense because it has all the characteristics which an invention must have. It will of course be a question of fact in relation to each new variety so produced as to whether that has been produced by an inventive process, but of course that is not a question which this Court is asked to answer in relation to Franklin barley. It has apparently been left for decision at another time or in another place. We are only concerned, as I understand it, with the issue of constitutional validity.

As to the issue of exclusivity which is the third of the issues raised by the plaintiff, I adopt all of the Commonwealth's submissions to the effect that an ample degree of exclusivity is conferred by the legislation to satisfy the legal requirement. Such limits as the Act do impose on exclusivity do not destroy the nature of the rights which are conferred by the Act as patent rights.

GAUDRON J: I wonder if we are addressing quite the right question in terms of exclusivity, as it were. We are dealing with, as it were, a new subject matter of patents and the question might not be exclusivity in the broad, as it were, but whether it is exclusivity as is appropriate to the subject matter.

MR BALE: I am using exclusivity, your Honour, in the sense of monopolistic rights.

GAUDRON J: Yes, but, as the Solicitor-General pointed out yesterday, you are talking about a product which of its nature is designed to reproduce itself, as it were, leaving aside the sterile seed controversy-type thing that is going on, I think, in other countries at the moment. It is when you take that into account that perhaps you argue that the exclusions are really simply exclusions which come about from the nature of the subject matter of the patent and the application of public interest considerations in relation to it.

MR BALE: We do not argue with that, your Honour.

GAUDRON J: Yes.

MR BALE: In other words, the issue of monopoly or exclusivity, because of the nature of the beast with which we are dealing here, becomes much less important than it may be if you were dealing with an entirely different type of invention. Of course, there is also the issue of whether exclusivity is properly regarded as an element of an invention for patent purposes or whether it is a consequence of having made an invention, i.e. that having an invention and a patent of an invention, that confers exclusivity upon you.

GUMMOW J: Section 13(2) of the present Patents Act of 1990 says that:

The exclusive rights -

which have been detailed -

The exclusive rights are personal property and are capable of assignment and of devolution by law.

Is that not right?

MR BALE: That is undoubtedly right, your Honour.

GUMMOW J: Is not the same patent followed with the Breeder's Act and Varieties Act?

MR BALE: Yes it is, but the difficulty with exclusivity in the sense which Justice Gaudron has talked about is that the way in which the breeding of a particular variety involved, it is very difficult, compared with other inventions, to identify a particular first piece of seed or whatever it is. It moves on and develops into many millions of seeds, as it were.

But our real submission about exclusivity is that it is a consequence of, rather than an element of, a patent. In any event, exclusivity has never been interpreted - certainly in a patents context and in the context of the law generally - as meaning absolute exclusivity. Can I take, perhaps, the example from property law of a lease of ground. Let us assume that the New South Wales Cricket Association leased the Sydney Cricket Ground for six months of the year for the purposes of cricket, but there was a provision in the lease or elsewhere that for one day during that period in each year the ground had to be made available to the legal profession for a picnic. That would not destroy the character of the document as a lease, the rights of exclusive possession would still be there, and the fact that there was an exception or perhaps a number of exceptions to the exclusivity of possession would not mean that the document was no longer a lease document.

In any event, as I have indicated, by requiring as a precondition to the grant of any right that there be invention for the purposes of 51(xviii), sections 5 and 10 of the Acts respectively necessarily require that all the elements of invention, whatever those elements might be, be present. Accordingly, to the extent that exclusivity - and whatever exclusivity might mean in this context -is an element as distinct from a consequence of a patent of an invention, it is required, we would contend, by both of the Acts.

That is all I would wish to say, your Honours, about the patents power and if I might then turn to the external affairs power. We would say, firstly, in relation to that, that it is well established that the Federal Parliament is able, in exercise of the external affairs power, to legislate in relation to matters which are of international concern to Australia. I will not take your Honours to the statements as to that but Justice Brennan, as he then was, of course, in Polyukhovich, and the reference is in our written submissions at page 561 of that report - I think, your Honour Justice McHugh in Polyukhovich at page 714 recognises that as a basis for the exercise of the external affairs power and that there are passages in the other judgments.

It is the scope of the phrase "international concern" which, of course, has been the course of debate, and it is clear, we would accept, on the authorities, that it has no very precise meaning but certainly includes treaty obligations and other obligations which are imposed by international law. But the power has been well recognised as being very much broader than that, and the passages to which I have referred in Polyukhovich so indicate. It has been suggested that they include such - - -

KIRBY J: This is a somewhat different view of the power that was advanced by the Tasmanian State in the Tasmanian Dam Case.

MR BALE: We have had to move on, your Honour.

KIRBY J: You have moved on. I see.

MR BALE: We have had to move on. The Court has moved on and we have had to accompany it.

KIRBY J: I see. I just thought I would clarify that.

MR BALE: Certainly, your Honour, Tasmania does not have a reputation of being a strong supporter of broad interpretations of Commonwealth power.

KIRBY J: Yes, that is why I am noting your submissions very carefully.

MR BALE: But in this case we recognise that the Court has moved on and that we are intelligently obliged to move with it and it is still a matter, of course, of the definition of the scope of that phrase, "of international concern". I will come back in a moment if I may to two comments which your Honour Justice Kirby made earlier this morning because they are worth exploring perhaps a little further.

We contend that essentially a treaty is of international concern or, indeed, any other matter is of international concern if it has the capacity to affect Australia's relations with other countries. That seems to be the nub of what the Court said in Polyukhovich. It seems to be the nub of what was said in Victoria v The Commonwealth and, indeed, it might go back as far as what was said in the majority judgment of the Court in Reg v Burgess way back in 1936.

The appropriate protection of proprietary rights of those who invent new plant varieties has, we contend, been recognised in Australia as a matter of international concern. It was recognised some time prior to the enactment of the Plant Variety Rights Act because, of course, that enactment purported to substantially put in place the provisions of the Treaty which was scheduled to it.

It certainly was recognised in Australia at the time of Australia's accession to the 1978 Convention, as evidenced by the fact of concession, that presumably was a matter of international concern when, as the papers before the Court indicate, Australia attended as an observer to the Convention meeting in 1968. So we contend that the enactment of legislation which deals with the protection of the proprietary rights that the originators of new plant varieties enjoy in those varieties, was properly regarded as a matter of international concern, and has properly been regarded as a matter of international concern in this country since some time prior to the enactment of the Plant Variety Rights, and it has continued, as a matter of international concern ever since. There has been nothing to suggest otherwise. We remain a member of UPOV. We perform, I suspect, most of the obligations under the 1991 Act of the Convention whether or not we are bound by it.

There is no reason, in our submission, to contend otherwise, and no basis upon which it can sensibly be contended otherwise that legislation which effect - set standards in this country for the recognition of intellectual property rights wherever they are derived is in plant varieties is other than a matter of international concern. Your Honour Justice Kirby in discussion this morning with my learned friend, Mr Gray, expressed considerable concern in relation to the exercise of the external affairs power on this basis, where there was a possibility that Australia might never accede to the Convention and so that you would have in place convention rights by which we were never bound.

In terms of these two pieces of legislation, I would submit that your Honours' concerns are met because under sections 5 and 10, respectively. If one relies on the external affairs power, we only get substantive rights under that legislation when we accede to the Convention.

KIRBY J: That is subject to section 82 because section 82 itself purports to confer substantive rights of its own force and without entering into international - - -

MR BALE: Conferred from the earlier Act.

KIRBY J: Yes, but as if PBR rights.

MR BALE: Yes, they are, your Honour, and I will come to that in a second, but they are confirming rights which were conferred under an earlier piece of legislation.

KIRBY J: And then changing them into a different kind of right, as I read this Act.

MR BALE: Well, not quite, we would respectfully submit, and that is the significance of sections 12 and 13 to which I have referred, because your Honours will see that in terms of the content of the right, sections 12 and 13 effectively provide for the only substantial changes which the 1994 Act bring about except in terms of the duration of the right, and that is the third substantial change.

If your Honours turn to section 82, you will see that a right which was granted under the 1987 Act and which is preserved does not bring forward or create the rights in that holder that are referred to in sections 12 or 13, nor does it extend the term. So, in other words, so far as existing rights are concerned, that is, rights conferred under the Variety Act are concerned, to the extent that they are brought forward under the new Act, they have no scope beyond that which they previously had.

It is only a new right which has a greater scope and those new rights, in so far as one relies upon the external affairs power, can only be conferred once we become parties to the Convention, if we are not already parties, and we are not concerned with that issue if we rely on the patents power.

CALLINAN J: Mr Solicitor, until such time as Australia accedes to a convention, do Australian corporations or people derive any protection or advantage under it out of Australia? I am thinking of Article 4 which is at page 133 of the materials that we were provided, and there are other places where it is but Article 4 of the 1991 Convention at page 51. When would we not have to be a party actually to the Convention? Would we not have needed to have acceded to it in order that our nationals would derive any protection out of Australia under it?

MR BALE: That would depend, of course, your Honour, on the terms of the Convention and, of course, its adoption in other - - -

CALLINAN J: That is why I am asking you to look at Article 4.

MR BALE: - - - and its adoption in other countries and if another country has adopted a convention which allows the nationals of other countries to register rights in that country, it would not matter that the other country was not a party to the Convention.

CALLINAN J: But we might be assuming obligations to other nationals in our country without providing for our own nationals reciprocal advantages in those countries. What about that?

MR BALE: In either case, your Honour, we may have done it and in any country that has not acceded to the Convention they are under no obligation to provide a comparable power, but of course the scrutiny legislation goes under to ensure that it does conform with the Convention ensures that where one is a party - and that is why one becomes a party, I would assume - that reciprocal rights are going to be offered by those other countries but, if you are not a party to the Convention and the legislation of a particular country confers rights on foreign nationals, then clearly they can be exercised irrespective of the fact that the foreign nationals are not members of a Convention power.

CALLINAN J: But they may very well. Other countries may very well only confer those reciprocal rights upon countries that are parties to the Convention. That would not be a surprising thing, would it?

MR BALE: It would not be surprising if it was so limited, your Honour, and I suspect that - - -

CALLINAN J: That might be a reason, might it not, for caution in upholding legislation in respect of a foreign treaty or convention unless and until such time as we are party to it?

MR BALE: But, your Honour, that really is not, in our respectful submission, what has come to be accepted by this Court as the appropriate test. It might be a reason for caution so far as the legislature is concerned, but it is not accepted - - -

CALLINAN J: It might be a reason for saying that it is not within that aspect of the external affairs power relating to treaties or conventions.

MR BALE: Because we say that that power is simply one aspect of the power to legislate with respect to matters of international concern.

CALLINAN J: I understand that, but if you want to bring it in under a convention or a treaty, that aspect of the external affairs power, what I have just put to you may be a relevant consideration.

MR BALE: Yes, our contentions do not seek to bring it in under that aspect. We seek to bring it in under simply a matter of international concern. These submissions are alternative submissions to those which would rely upon that aspect of the external affairs power which depends upon the existence of a convention or treaty to which we are a party.

KIRBY J: How does the Court then, in a case where you come up in another case saying, "No, no, no, this is not a matter of international concern", how does the Court judge whether a matter is of international concern as against a treaty between Kazakhstan and Uzbekistan which has no apparent international flavour? It is very difficult for a court to say this is a colourable, this is not of international concern. What if this Act of the Convention had two parties, when does it become, when does it move into a matter of international concern?

MR BALE: Your Honour, I can get no more precise an answer to that than Justice Brennan, as he then was, gave in Polyukhovich and that is that it becomes a matter of international concern when it has the capacity to impact upon Australia's relationships with other countries.

KIRBY J: But we cannot judge that. That really is a matter for the Executive Government or the Parliament and that means it is self-divining.

MR BALE: I would submit that this Court can judge it but it takes the Court into the difficult area of whether the Convention is a colourable one or not, to use the phraseology which has already been adopted. But, I would submit that a country, a national government could not be allowed to use agreements, international agreements of the type which your Honour has just described.

KIRBY J: But where does the line get drawn? If you do not adhere to saying, if you are relying on a treaty, if it is that part of external affairs, then you have got to join the Treaty. Once you go beyond that you are in a sea of troubles because there is no way a court can judge. If the Executive Government or the Parliament says it, we have just got to accept.

MR BALE: I accept the difficulty, your Honour, because the area is a grey and uncertain one, like so much, unfortunately, of external affairs.

CALLINAN J: That is very much like the dissenting judgment of Chief Justice Latham in the Communist Party Case who said that the Executive was in the best position to know whether Australia was at war or whether a country was at war, but none of the other Justices of the Court agreed with him.

MR BALE: Yet, again, the Court seems to have moved on and the comments of the judgments in Polyukhovich would suggest that if you accept that the test is one of whether a matter is of international concern, in the sense that I have just described and you take the next step of saying, "Well, it is a matter of exercising a judgment as to whether it is or not", one, then, can only essentially say, "Well, who has to exercise that judgment?" Clearly it is the Executive in terms of determining - - -

KIRBY J: But under the rule of law, and under the role of this Court, we can never forfeit that to the Executive Government. We have our own duty to discharge to say whether, as Justice Gaudron pointed out earlier, this law is properly characterised. But, the question is what criteria can we use once you move away from a treaty. Mr Gray made a good point about the ILO recommendations which are not treaties. You do not subscribe; you are just there in a general conference at the ILO. It is a real problem area, I think, because the external affairs power exists in section 51, which is subject to this Constitution, and which, therefore, is subject to the federal structure of the Constitution.

MR BALE: Your Honour, it would be my submission that it is difficult, idle and possibly almost self-defeating to try and enumerate the criteria by which a matter can properly be judged as being or not being a matter of international concern. The difficulties have been addressed by Justice Brennan in Polyukhovich. At the end of the day, as your Honour properly says, it is going to be for the Court to decide if someone challenges an Executive decision as representing a colourable exercise of Executive power, and the Court is going to have to determine whether, in fact, the issues which backgrounded Australia's accession, or ratification, of a convention were, in truth, matters of international concern or not. One can readily imagine the different members of the Court might see favour in different criteria, but to try and enumerate criteria - it has not been done that I am aware of in the past.

KIRBY J: Either you do or it is in the class that, I think it was Justice White said, when you see it you know it and you have criteria in the back of your mind but you are not capable of articulating. Now, when I look at this area of international relations I am inclined to say this is a matter of international concern. It is the Convention, it is a developed Convention. It has a lot of states. It is a matter on which there is a lot of international agreement and need for international agreement, but I really feel that is a very unsatisfactory way to answer the present plaintiff that comes here, to say what are your criteria for coming to that view?

MR BALE: I guess the criteria can only be, your Honour, it is an international concern because - and I am not trying to define a set of criteria because I have not, in my own mind, formulated a set - but your Honour would say why is this a matter of international concern? What characteristics does this particular matter have that legitimately entitle one to identify it as being of international concern and I guess one simply takes down, lists those criteria which seem to have the potential to impact upon Australia's relations with other countries and one says, yes, there are a gathering of matters which sufficiently identify it as a matter of international concern or the list is too short or too unpersuasive so to categorise it.

GLEESON CJ: Is that a convenient time, Mr Solicitor?

MR BALE: Certainly, your Honour.

GLEESON CJ: Dr Griffith, just before we adjourn, how is your timetable going?

MR GRIFFITH: Your Honour, at the moment we seem to be an hour behind.

GLEESON CJ: An hour behind?

MR GRIFFITH: Yes.

GLEESON CJ: We will resume at 2 o'clock but I gather after what you say we might run into tomorrow.

MR GRIFFITH: Your Honour, I am only involved in this matter. I would hope to be 20 minutes or so in reply. I am not sure how long Mr Bale is going.

GLEESON CJ: You mean you are not going to be here for the rest of the entertainment?

MR GRIFFITH: No. I will be back tomorrow for more entertainment. Could I assist the Court by handing the draft of outstanding issues that we have prepared. I should indicate, also, your Honours, that there is a document, a summary of facts. We have not been able to agree on the flesh and blood of Franklin barley but I could indicate to your Honours that although the plaintiff has no particular knowledge, it is prepared to accept the statement of facts in paragraphs 7 and 8 of Tasmania's submissions as background information being the basis on which it is asserted with respect to Franklin barley that there is an entitlement to registration under the Act.

We have no more knowledge than what is there, your Honour, but we are prepared to accept that the Court may have regard to that.

Could I hand to your Honours the summary of facts and also a document which we head "Outstanding Issues" which would indicate the matter - - -

GUMMOW J: This is not very satisfactory under a stated case procedure. This should have all been sorted out before we got here.

MR GRIFFITH: Your Honour, that much is accepted. We are doing our best to meet your Honours' stipulation.

GLEESON CJ: We can decide at 4.15 whether we will give a "not before" time for your matter tomorrow.

MR GRIFFITH: If your Honour pleases.

GLEESON CJ: You may just have to keep an eye on the progress. We will adjourn until 2.00 pm.

AT 12.49 PM LUNCHEON ADJOURNMENT

UPON RESUMING AT 2.03 PM:

GLEESON CJ: Yes, Mr Solicitor.

MR BALE: Your Honour, I just have four more points that I would wish to make and I am encouraged by my colleagues to confine myself to a minute each. In relation to the first: your Honour Justice Kirby this morning referred to the fact that Australia had not ratified the Convention. Of course, that - you were referring to the 1991 Act of the Convention at that point and the important thing about that is - - -

KIRBY J: I was slipping into an error that many others did before me until Mr Gray made us wise about it.

MR BALE: The important thing about it, of course, your Honour, is that since Australia ratified the 1978 Act in 1989, it has been a member of UPOV, it continues as a member of UPOV, and it has undertaken and remains obliged to follow the obligations which the Convention imposes upon it. So that, if, for example, the 1991 Convention was not an adequate activity to satisfy Australia's commitments under the Convention, we would be at risk of being brought before the International Court by a disappointed party who claimed that they were not able to get their proper rights under the Convention.

KIRBY J: You say before the International Court?

MR BALE: Yes.

KIRBY J: An individual could bring Australia before - - -

MR BALE: No, not the country; another country whose citizens were not being accorded the rights which the Convention would assure to them.

The second point is that it was contended for the plaintiff that the anticipatory enactment of a convention does not attract an exercise of the external affairs power. Our submission in relation to that is that there is no authority for that proposition, and it does not fit easily with the established concept that constitutional power may be exercised in relation to a matter which is of international concern to Australia. There may well be all sorts of matters which warrant the anticipatory enactment of convention provisions, of the getting ready-type provisions that your Honour Justice Gummow, I think it was, referred to, or your Honour Justice Hayne, one or the other yesterday, all sorts of machinery provisions which should be appropriately put in place before the full Convention provisions were to take effect. If it is not the - - -

KIRBY J: How long do you have to get ready or to be in a state of anticipation before you have slipped out of anticipation into rejection? How can an Act then move in and out of constitutional power?

MR BALE: I am not sure that it does, your Honour, because as long as you can identify that there is a matter of international concern, that is sufficient to justify the exercise of power. As I have said previously, the substantive rights which the Convention confers do not, unless they are justified under another head of power, become operative until Australia becomes a party to the Convention. So that is the protection that the Acts provide against the concern which your Honour expresses in this regard. But if it is not the external affairs power, then our submission would be that the incidental power would be sufficient to allow that to be done.

The third point that I would make relates to paragraphs 28 and - or perhaps before I move to that, simply draw your Honours' attention very quickly to the schedule to our written submission which lists a number of conventions which were enacted in Australia in the sense of being scheduled to legislation when they had not yet come into force. Without going through them in detail, let me simply say that there are more than half of them in respect of which their provisions brought them into force or brought parts of them into force before Australia became party to the conventions which were scheduled.

So if the external affairs power is not enough to sustain the legislation which the Court is presently considering, there must be a real question over a number of those pieces of legislation which have for a fair time been accepted as valid; and one of them is the Racial Discrimination Act which this Court has, of course, held to be valid, because there were certain provisions of the Racial Discrimination Act which were brought into force before Australia became a party to the Convention upon which it depends.

The third point related to points 28 and 29 of our written submission and I have already indicated that the only additional benefits which the 1994 Act brings to a patentee or the holder of rights, the grantee of rights, as compared with the 1987 Act, are those which are canvassed in sections 12 and 13 of the Breeder's Act and as well an extension of time. In other words, there are no new substantive rights attaching to a transfer of a PBR and it follows from that, in our contention, that the Breeder's Act is, in its present operation, appropriate and adapted not just to the 1991 Act of UPOV but also to the 1978 Act of UPOV and it would be valid, in our contention, on that basis.

Finally, as to paragraph 30 of our written submissions, we contend that should the Breeder's Act be held to be invalid but the Variety Act not, then all of the Breeder's Act must fall, including that provision in it which repeals the Variety Act, and, therefore, the Variety Act would continue in force, Australia's obligations under the 1978 Act of the Convention would continue thus to be protected and the rights conferred by that Act would remain in place. Those are my submissions, may it please the Court.

GLEESON CJ: Thank you, Mr Solicitor. Yes, Dr Griffith.

MR GRIFFITH: Your Honours, dealing first with the patents power issue, it is our submission that the grants of rights under each of the Acts cannot be characterised as laws with respect to patents of inventions and it is to be remembered that the conditions in section 5 and section 10, particularly, are framed by reference to patents, they are not framed by reference to placitum (xviii), generally.

In our submission, these legislations do not comply because they impose no requirement that the plant varieties in respect of which those rights are conferred be inventions. It might be argued, we will concede, that the process of breeding or origination, as it is called in the first Act may constitute an invention for the purposes of the meaning of that word within placitum (xviii) but we submit that the rights are granted with respect to the product of that invention, the plant variety, which may not constitute an invention at all.

Your Honours, when one goes to the PBR Act, I should say the Breeder's Act, one sees that there is a deliberate dichotomy between the requirements of section 5 and section 12 of the Variety Act which required the aspect of newness for the variety and that, within section 10 and section 11 of the Breeder's Act, where, we would say quite deliberately, the requirement of newness is omitted. In that respect it is quite clear that whatever is established as PBR is, by direct omission from the previous requirement in the Variety Act, intended to be a right which has, so far as articulated in this statute, which does not have as its essential requirement the aspect of newness.

In our submission, the Commonwealth has failed to address this issue but we say that what might have been protected was the new process but in this case what is protected is the product. So that if one invented a new process to produce the product - and if we take the example of my learned friend the Solicitor for the Commonwealth of a blue rose - that would be a prohibited matter by reason of the rights granted under each of the Variety Act and also under the Breeder's Act.

My learned friend submitted in his submissions that the definition of "breeding" is for the purpose merely of identifying the breeder, but he said that does not make the process that which is subject to the Act. The subject of the matter of the grant is the product. That was my friend's submission.

GLEESON CJ: But we are dealing by hypothesis with new varieties, are we not?

MR GRIFFITH: Your Honour, I am going by reference to the terms of the Act. The Act deliberately has a contrast between the Variety Act and the Breeder's Act so as to not require as part of the qualification by reference to the external affairs power in section 10(b) in contrast to section 5(a) or to require in section 11, in contrast to section 12 of the former Act, the aspect of newness.

GAUDRON J: But does that not come from the definition of "plant variety": that can be distinguished from any other plant grouping by the expression - - -

MR GRIFFITH: That does not mean it must be new, your Honour.

GAUDRON J: I would have thought - - -

MR GRIFFITH: It just means it must be distinguished. It might be a blue rose already out there. It is perhaps the sort of thing that was referred to by the Supreme Court in the Chakrabarty Case where they referred to the obvious fact that Einstein could not have patented E equals MC squared nor Newton patented the law of gravity and the fact that one cannot just pick up something and call it a patent if it is already there. It may well be that one falls within the definition of "variety" without having to have this aspect of newness, in our submission.

GLEESON CJ: If that is right, the long title to the Act is misleading.

MR GRIFFITH: Well, it could well be, your Honour, because when one looks at the terms of the provision - our point, your Honour, is there is nothing in this Act which requires that there be an invention. That one is entitled to registration from the registrar, as of right, on satisfying the statutory requirements without one of those aspects on which the registrar has to be satisfied that there is an invention - that the plant be an invention. There is no requirement for that and the registrar is obliged to register whether or not that be so.

Your Honours, to use my learned friend's example of the blue rose, were one to develop a blue rose not by the mechanism of cross-breeding, introducing flowers across a crowded field, but to do it by the form of genomic intervention, genetic engineering, the sort of aspect referred to in section 3(5) of the PBR Act, because of the result being the same, if one produced a rose of the same characteristic, on my learned friend's arguments, that would be proscribed by the legislation even though one had a truly new inventive process which would otherwise fully fall within the definition of invention. That is the point we wish to make as to the disconformity between the concept of invention and the structure and operation of the Act which describes what is to be the inquiry by reference to the process but provides for the protection to be by reference to the product.

Your Honours, the Commonwealth submitted that it is sufficient if the plant variety is new and stable and that then necessarily it would constitute an invention. We say, your Honours, that there is no requirement of newness and this is also picked up in section 43 of the Breeder's Act which requires no aspect of newness. Secondly, your Honours, we say, in any event, merely because something is new in the sense of being distinguishable, in our submission, that does not make it inventive or an invention.

McHUGH J: I am not sure that the omission of "new" in section 10 and 11 may not be a mistake. The definition of "breeder" in section 3 says:

"breeder", in relation to a new plant variety -

and section 5 which defines "breeding" says:

A reference in this Act to breeding, in relation to a new plant variety, includes a reference to the discovery of a plant - - -

MR GRIFFITH: Your Honour might be well to say there is a mistake, but where are the mistakes in this Act. Our submission is that the entire legislation is a mistake. One has to work hard to introduce into the definition of section 11 the aspect of newness as a requirement when one can see it is consciously dropped from the corresponding definitions of section 5(a) and section 12 of the previous Act.

GAUDRON J: But what about 10(b)?

the breeding of the plant variety constitutes an invention.

MR GRIFFITH: Your Honour, that is breeding. It may be one works very hard and says "breeding" means breeder which means new, but our points are that the Acts in the object of their direction do not stipulate with clarity what we say is an integral aspect of the description of invention. Not strictly to the Statute of Monopolies but just describing what is an invention.

GAUDRON J: But if you turn back to 10(b) for the moment, do we not have to read the whole of the Act subject to that? If it is not an invention you do not get the right.

MR GRIFFITH: By reference to invention, yes, your Honour; but what we say is that when one looks at this term of the Act there is no aspect of incorporation of the definitions of what is provided for the Act. It may well be that then one says the operation of 10(b) would suspend the capacity to grant rights.

HAYNE J: It is more than that, is it not. Section 26 has to be taken into account. How can one be an applicant is one is not the breeder or an assignee of the breeder of the variety, and the variety must be distinct. If one is not the breeder of the distinct variety - - -

MR GRIFFITH: What we say section 10(b) does not require that plant variety equal invention. We admit that one can look at the Act in various ways, but what we refer to here is the disconformity to the usual concepts. The second point we make is to say that even if one introduces an aspect of newness as a requirement, the fact that newness is stipulated does not make itself an inventive process or an invention. A new use for an old substance has never been patentable. If we could refer to Commissioner of Patents v Microcell [1959] HCA 71; 102 CLR 232, particularly 246, 247, in Re Application of Compagnies Reunies des Glaces (1930) 48 RPC 185 at 187. Also, may I refer to the Mirabella Case [1995] HCA 15; (1955) 183 CLR 655, which, to some extent, would seem to be a recent statement of the sort that Justice Kirby inquired of this morning, where their Honours Justices Brennan, Deane and Toohey said at 664, 665:

traditional patents law under s 6 of the Statute of Monopolies long recognised cumulative requirements of an element of invention (as distinct from, eg, mere discovery or analogous use) in the subject matter as described by the specification and novelty or newness as disclosed by comparison with a prior art base.

That would seem to us to be a short description of the elements required for the concept of invention.

Our submission is that newness or novelty and invention are discrete requirements. Even if it was not until 1952 with the introduction of that expression in the 1952 Patents Act, it was necessary to distinguish between them. In this regard we refer to the discussion in the Werner Case (1989) 25 FCR at page 565. If the Commonwealth submissions were correct, anyone, we would say, could patent any new plant variety. We submit that that is not the case.

GUMMOW J: What is the significance of section 43(2)?

MR GRIFFITH: Of the Breeder's Act, your Honour?

GUMMOW J: Yes. It seems to be requiring a comparison with common general knowledge.

MR GRIFFITH: Just an aspect of distinction, your Honour. If one says it is different, that it not even an aspect of - - -

GUMMOW J: But that is the language of obviousness and, thus, of inventiveness, the notion of what the common general knowledge was.

MR GRIFFITH: It might just say, your Honour, it is different. We say, your Honour, that aspect in itself could not constitute an invention, and then one could say, "Well, it would seem to be something different". It is not even saying "you". But, your Honours, in a way it is difficult for us to make complete of what is - - -

GUMMOW J: And it seems to be common knowledge anywhere. It does not seem to be territorially confined.

MR GRIFFITH: No, your Honour.

GUMMOW J: So, that is a narrower version of common general knowledge.

MR GRIFFITH: It may be, your Honour, but it is not by reference, we would submit, to the usual concept of that which is required for a convention.

Your Honours, we would submit that merely because there are rights constituting variety rights and breeder's rights under the Act, there is no requirement that they be an invention and that they are not expressed or qualified as being in the nature of patent rights. So that on that basis we say that neither law can characterised as a law with respect to patents of inventions.

Now, it is generally submitted by the Commonwealth, particularly in my learned friend oral submissions that there is a broad aspect of expression to the power, but what my learned friend was unable to do in articulating that approach to indicate that there was a limitation to anything more general than saying that the essential thing is something new that is done or created. In our submission, your Honour, that is to express no limitation at all on the power and although my learned friend said that he could only indicate by example words which were not comprehended by the totality of section 51(xviii), in the end he gave no example.

We still have no example from my learned friend as what would be a relevant limitation of this wide circumference which he postulated other than making the aspect the essential thing is that there be something new that is done or created. In our submission, particularly having regard to the restrictions of section 5 and section 10 of the respective Acts, that in no way can embrace placitum (xviii), let alone the narrow requirement of those sections that there is a condition of coming into operation not by reference to the totality of the expression in placitum (xviii) but by reference to the aspect of the expression "inventions".

We certainly do not submit that the aspects of rights which may be granted have to be completely exclusive. What we say is that there must be an inquiry as to the aspect of exclusiveness and in this case, by reference to the sections that we have referred to in the two successive Acts, in our submission, the line has been crossed. In effect, what is embraced by my learned friends accepting the phrase which was used by members of this Court in the Nintendo Case 181 CLR 160 referring to the prospect that placitum (xviii) extend to laws with respect to all products of intellectual effort, that that, in effect, abrogates the force of a phrase which we would submit is one whereby there is an aspect of accepted general meaning for the four aspects of intellectual property which are there described.

We say the Court in Nintendo was not intending to hold a law that would be valid, even though it could not be characterised as a law in respect to copyright, patents of inventions and designs or trade marks. We say they remain the essential requirements of the aspect of a power under placitum (xviii) and we say the observations of the Court were in the particular context of dealing with a matter of dispute as to whether the so-called EL rights provided for under the Circuit Layouts Act would, in the circumstances, amount to an acquisition of property under the acquisitions power. The passage quoted is no more than the Court referring to the principle, which must be accepted and is obviously apposite, that when one is exercising the power with respect to the various rights under placitum (xviii), there is no room for the operation of the acquisitions power.

The Court was not addressing itself as to the ambit of Article 18 in a way which a way which in effect redefined it to say that what constitutes the power - and this is the essence, we would submit, of our learned friend's submission, that instead of the four elements of traditional intellectual property rights there defined, there is a rearticulation of the power to be a law with respect to intellectual property.

That is the essence of my learned friend's submission and, in our submission, that is not a construction which was established or justified by the observation in Nintendo dealing with the generality of the argument as to relationship of placitum (xviii) with the acquisitions power.

The Commonwealth also referred to IPEC v Time-Life International [1977] HCA 52; 138 CLR 534, particularly Justice Gibbs at page 541, in support of the proposition that once a patentee sold a particular example of his invention the purchaser could do whatever he or she liked to do with it, what they wished and we would say, your Honours, this highlights the difference between the rights constituting either variety rights or breeder's rights and patent rights. It is the case that there is no provision for exhaustion of variety rights or breeder's rights once the grantee of the right has sold or otherwise disposed of the plant variety, apart from section 23 in the Breeder's Act, so that the rights constituting variety rights and then breeder's rights in substitution extend, we would submit, way beyond patent rights in an uncontemplated manner which had sufficient significant implications for trade of commerce.

GUMMOW J: I thought the Solicitor-General misquoted the patent position, actually, because one used to have restrictive covenants that ran with the goods that attach a condition.

MR GRIFFITH: Yes. Your Honour, what we say here in this case there may be - - -

GUMMOW J: And thereby enforce resale price, might it not? That is what National Phonograph is all about.

MR GRIFFITH: Your Honour, what we say the position here - it is not the goods which one can control and trace. It may be the dealings later with those goods which, inherently in the case of variety rights, are later propagations, so that the right is not a right with respect to the good itself. What the right is to trace goods which may be bred and rebred, for example, through three generations and, for example, into the hands of my client who may seek, having bona fide bought it from a producer, to export the good. That is, in effect, the underlying issue whereby the second defendant and the plaintiff are in dispute.

The claims run to the product of the product, perhaps indefinitely, to the extent that there may be a claim for property rights spreading indefinitely for the life of the right which is created under the legislation. In our submission, this is a large extension to any traditional expression of the right of patent in respect of particular goods themselves. We say it is alien to the concept of patents of inventions.

Your Honours, may we turn then to the issue of external affairs? Now, your Honours, we regard it as of decisive significance that in page 65 of the question reserved book, paragraph 3, line 20, the Commonwealth, who is here to defend this legislation, eschews any reliance whatsoever on the aspect of international concern to support these laws. That is a natural concession because, as those submissions make a virtue, it is quite plain from the laws themselves that they are intended to be expressed by reference to each of the Conventions which are attached, full text, as a schedule, and by reference to the circumstance that the legislature has turned its mind to power and in each of sections 5 and section 10 has made reference to the two sources of power on which my friend, in his submissions, certainly the written submissions, entirely relied upon in his oral submissions, there was some movement.

KIRBY J: There certainly was. There was a distinct, express reliance and, therefore, we cannot ignore it. It is a matter of law and therefore - - -

MR GRIFFITH: I am not ignoring it, your Honour, what I am saying is that - - -

KIRBY J: You are making a forensic point, are you?

MR GRIFFITH: My starting point is to say, your Honour, it is for the Commonwealth, one would suppose, to say, "We justify these laws because, as the Government of Australia, the Commonwealth, we regard ourselves as enacting matters of international concern", and, your Honour, it is certainly a very late revelation of this possibility that it appeared, not in the written submissions, but in the oral argument. Your Honour, we say, secondly, it is not for us to establish the absence of international concern, it is for those who seek to justify the legislation to draw such material as is appropriate, bearing in mind the issues which were subject to a matter of exchange between me and members of the Court yesterday as to how that is done, to establish the issue of international concern.

At the end of the day, it seems the materials the Court have are the Conventions itself; Professor Lazenby's report which we, after some hesitation, were able to bring confidently before the Court as being part of the evidence which might be regarded to indicate the mischief which the legislation was directed to; and we have the Millett article to which I make no objection because there is only three and a half pages which are relevant to this issue and on the second page there is use of the expression "major" and also "deep", which is quite sufficient for our purpose to establish a point that we seek to make, or certainly to reinforce it, that there are significant differences between the two Conventions, the 1978 and the 1991 Convention.

KIRBY J: You say two Conventions, but Mr Gray makes the point that there is the one.

MR GRIFFITH: I am coming to that, your Honour. If I may come to that in order, but we will deal with that. Your Honours, we say that it is for those who seek to satisfy the Court about international concern to come along with material to indicate that to the Court. It is not for the Court to draw, we say, very slim entrails across your Honours' desks to see can we ourselves, looking at this material, say, "That seems to be a matter of international concern". Your Honour Justice Kirby mentioned there may only be two or three parties to a convention. The 1991 Convention only requires five parties for it to come into force. I think there is a similar provision in the previous 1978 Convention. So we say that with this slender material one cannot say that there is any aspect of the case for international concern to be made out.

Although in the second defendant's submissions at paragraphs 4.14 to 4.18 there is a reference to the conventional authority of this Court as to matters of international concern, there is no attempt whatsoever to tie that material to any relevant facts or circumstances which may be of assistance to make that finding in this case. Indeed, your Honours, at the end of the day we would suppose that the main point to be relied upon by the second defendant on this aspect of its submissions is the fact that we continue as a member of the 1978 Convention but, in our submission, that is not to take the matter any further than to say we are continuing to be a party to the Convention itself. It does not say anything with respect to matters of international concern in our respect which can be relied upon separate from the external affairs power to justify quite independently of our being a party to a convention.

The point that we are a party to the Convention is relied upon to say it is international concern. We say this is a case about enacting a legislation because we are a party to it. When one reads the explanatory memorandum, paragraph 2, which I handed to the Court yesterday, one sees there that the explanatory memorandum explains the Breeder's Bill as intending to bring in the scheme in conformity with the 1990 Act of the Convention. We say it is yet another indication that one is dealing here with, as one sees from the Commonwealth's submissions, a situation of enactment by reference to a treaty obligation, not by reference to the concept of international concern.

KIRBY J: What do you say about the schedule to the Tasmanian submission which has a very large number of statutes of the Commonwealth which are said to have brought into force conventions which were not then binding on us?

MR GRIFFITH: Your Honour, there is the dichotomy in this aspect of external affairs between international covenants, particularly those which may be sourced from the United Nations or other multilateral sources, dealing with, if one may say, basic principles - I think your Honour used that expression earlier - than dealing with specific and narrow issues such as this sort which, in their entirety, depend in essence upon their particular terms. In this case, one has a specific legislation which we know from the Lazenby Report there is some international debate as to whether they are a good thing or not a good thing, perhaps depending upon the nature of the particular State's economy, which might be - - -

KIRBY J: One of them I notice is the Petroleum (Australia-Indonesia Zone of Co-operation) Act 1987 .

MR GRIFFITH: This is a very good example, your Honour, because we would suppose that Australia is a party to that Treaty.

KIRBY J: But the point being made by Tasmania is that this is one of several statutes which was enacted at a time when the Treaty had not been ratified by Australia.

MR GRIFFITH: Your Honour, if I may pause. If one is a party to the discussions and negotiate a treaty, one becomes an original signatory to the Convention, as we could have in this case as observer but chose not to. That has no force at all. If there is a requirement, for example, for five signatories before a convention comes into effect, your Honours, Australia may become a party to the treaty by acceding to the treaty or ratifying it, and in that case, your Honours, Australia is a party to that particular instrument, even if it has not yet received the required number of ratifications.

But, your Honours, in that case the convention is not in force but Australia is a signatory to it and is a party. We would suppose, your Honour, that if Australia had signed this Convention and it was the fourth signatory and it did not come in force until the fifth signature was obtained, that would be sufficient to give a basis for the exercise of the power by reference to the external affairs power. We would not cavil at that. It is in the nature, your Honour, of international conventions. Some have a low threshold, as your Honour pointed out, only two. Others have a high threshold, they might have 35 as in the case of, I think, the Nuclear Non-proliferation Treaty. It depends on the nature of the treaty.

Often the number is kept low so that there may be a prospect of early implementation. The Hamburg Convention came in force because it was ratified by five land-locked countries, was what sent it across the line, but nonetheless that was sufficient to get the numbers up so it came into force. This is the usual aspect of international law, but your Honour, the fact that it has not come into force, we say, is not the inquiry. The inquiry is whether or not Australia has ratified, become a party, not whether Australia has signed, but whether Australia has committed itself by ratifying if it was an original signatory or by an instrument of accession if it were not. This is what had not occurred at the time of the enactment of the Varieties Act and which still has not occurred with respect of the enactment of breeder's rights. So, your Honour, that is really what we would say on that point.

Your Honour, we say that the reference points in the Act in section 5(a) and section 10(b) are indicia which the Court can have regard to in dealing with the submission made that there is a separate basis of support by reference to a rather abstract core to issues of international concern without the Court having any further material for the basis of making that submission.

If the Court has any doubts on the issue, in our submission, they should be resolved in favour of not relying on international concern. It is not for us to dispose of that assertion. We say it is for those to assert it to establish it and it is very much, your Honour, something which came, we would submit so far as the Commonwealth was concerned, during the running of the oral submissions and, indeed, your Honour, for that reason our written submissions did not deal with this issue as it might extensively have been dealt with because we did not see it being raised as the basis for justification.

KIRBY J: Do you agree that if the Act is sustained by the patents power that there is no need to examine the external affairs power?

MR GRIFFITH: Of course, your Honour, the sections are disjunctive, but, your Honour, what we do say - - -

KIRBY J: There is nothing in the Act, in the detail of it that it is separate and several?

MR GRIFFITH: Not to us, your Honour. Your Honour, we say that it is useful to have the reference to the patents power because if it were not there one might not have even thought about it, that one is creating new rights which, we say, are disjunctive from a patents of inventions, one would have to go searching for the power. It is quite useful that it is there because at least one can see what Parliament possibly had in mind.

We say, your Honour, having exercised conscious choice not to bring it within the Patents Act because, we say, for the reasons one can pick up from the Lazenby report, it is not such a process which is amenable to articulation by reference to the general operations of patents law, save in the very narrow cases of which there have been two examples of Australia where plant varieties have been registered within the strict requirements of the patents law.

Your Honours, it may well be that there are one or two provisions that involve some inquiry as to whether there are contracting parties, for example, section 29(1) dealing with priority date but that probably does not need any support from external affairs, we would say.

Your Honours, the suggestion of the Commonwealth is that Australia's accession to relevant treaties is unnecessary to invocation of the head of power. One might say in that case why is it my learned friend could really suggest no more than making assurance doubly sure that one should have a provision such as section 5(b) of the Variety Act and section 10(a) of the Breeder's Act.

Clearly, your Honours, the legislature regarded, so far as external affairs was concerned, this issue of significance and we would accept your Honour Justice Kirby's observation and would submit that in considering validity under the external affairs power one should look at the Act as if it is entirely to be supported from external affairs, that is to engage in the inquiry of if this Act were merely supported by the external affairs power would it be valid, not to make the inquiry it may be supported in its initial operation by the patents of inventions power. It may later pick up support from the external affairs power.

We say that certainly the legislation seeks to have immediate operation, notwithstanding the requirements of section 10(a) that there be no grant of rights under the Act until there is accession to the Treaty. We would submit that my learned friend the Solicitor-General was incorrect when he agreed with the suggestion at the transcript, page 104, that putting section 82 of the Breeder's Act on one side no question arose because of any part of the Act failing because Australia had not entered into the 1991 Convention before enacting it. This is the "getting ready" issue, your Honour. It reminds me of a song I used to sing when I was young and hopeful, about saying, "I'm getting ready for Freddie because Freddie is getting ready for me".

Now, in this case, it is not just the case of getting ready for Freddie, Freddie has already gone to the party. That is the point we seek to make to say that there is really everything operative in the Act apart from the actual grant of breeder's rights. Now, that is a matter which may or may not ever be capable of implementation because we may never become a party to the 1991 Convention, but so far as the existing operation of the Act is concerned, the Act has completely got up and got going. The registry was established at once by transmission under the transitional provisions, the registrar is there, applications may be received and the effect of section 20 in the Variety Act and section 39 in the Breeder's Act is that there is existing property rights established on the proclamation and the coming into force of each of the respective laws which are defined as being personal property and capable of being assignment and sold. I am sorry, your Honours, those references are both to the Breeder's Act. Section 20 says it is "personal property" which can be sold and section 39 provides that there is an existing property right.

The rights to breeder's rights under the Breeder's Act are established on application. So far as, of course, section 82 is concerned, they are fully establishment but so far as other applicants are concerned, they are in the position that so long as eventually, looking from the point of external affairs, the Breeder's Act becomes supported by Australia becoming a party, there will be a relating back of all rights and remedies to 10 November 1994. In that case persons such as my client will be in the position that they will be made subject, we would say effectively retrospectively, to any dealing they have had with respect to a product, including in this case what is alleged to be a product where there were pre-existing variety rights under the Variety Act law which have now been transposed into rights of - breeder's rights relating back to the original date under the Breeder's Act.

So, that, your Honours, if this Act were supported merely by the external affairs power, persons such as my client will be in the position they will not know indefinitely whether or not lawfully they may trade in a product of Franklin barley because they will never know whether this Act is going to come into force and whether the condition of 10(a) is going to be satisfied.

GLEESON CJ: You accept the proposition that if the Breeder's Act is invalid, but the Variety Act is valid, the consequence of that is that the relevant rights are now rights under the Variety Act?

MR GRIFFITH: No, your Honour, we do not say that. First, our proposition is the Variety Acts could not be valid because of our later accession point. Our second proposition, is that 78 does operate according to its terms in the Breeder's Act. The Variety Act is repealed, in our submission. We submit that the transitional provisions are not a recognition of continuing rights in any way, so as one might say that there is anything of the Variety Act remaining. What we say is the transitional provisions confirm absolutely that there is a complete substitution of continuing rights under the Breeder's Act.

We would say if the Breeder's Act is unlawful, it nonetheless remains that there is an expression of contrary intention for section 8 of the Acts Interpretation Act, because Parliament, in Part 9, whether it is valid or invalid, has expressed an intention that section 8 of the Acts Interpretation Act should not otherwise apply to the repeal. We say it is not a concept of dependent relative repeal or something like this, by adaption to some principles of equity of the sort, that one section of the Breeder's Act which would be effective would be to repeal the Plant Variety Act.

My learned friend, Mr Gray, says that situation would leave Australia in defiant breach of its international obligations as a continuing party to the 1978 Convention. We would deny that, your Honour, because we could say Australia would be able to re-enact the Variety Act, it could do it next week, and quite possibly, although we have reserved our position on that, it could do it retrospectively back to 10 November 1994 so that there would not be a gap. So, in our submission, it is the case that even if the Variety Act were regarded as otherwise within power, we submit the effect of the Breeder's Act is that it has been repealed, and that in as much as there may be a desire to provide continuing protection, the choice of the Commonwealth would do what my learned friend says they are thinking of doing quickly, namely, become a party to the 1991 Convention and enact it, as we say they could. We say the Breeder's Act is not a good version, but it is a start, or, your Honours, they could just re-enact the Variety Act to be subject to such arguments as may arise about whether or not that is reasonably adapted to purposes of enacting the 1978 Convention.

KIRBY J: Mr Solicitor-General for the Commonwealth said yesterday something in passing which I think we had probably better ignore, in which he suggested that perhaps membership of the new Convention, or the new Act is not far off. Now, what will happen if between now and the decision in this case that occurs, do we decide this matter according to the law as it stood?

MR GRIFFITH: Of course, your Honour, because we would say the Breeder's Act remains just as invalid, it is necessary to re-enact it.

KIRBY J: You say we face that problem if and when it arises?

MR GRIFFITH: There could be - I am not sure where the depository uses Geneva, where is it, but, your Honour, the Ambassador could run in before the Court rises today and put in the instrument. In our submission, that has absolutely no effect on our argument.

McHUGH J: A point you made in-chief was that the Act must be valid at the time.

MR GRIFFITH: That is Communist Party, yes, your Honour, and a Communist Party point, your Honour, but we do not take the defence power analogy any further, your Honour, that having regard to facts and whether there is a foreign digressive treaty - that is a defence power issue, it is not an external affairs power issue and we do not intend to detain the Court to address on those issues, but the point we wish to make, your Honours, that there are no rights under the Act suspended at all. There are property rights immediately granted of value, not just by reference to those translated - I am sorry, variety rights, but also with respect to any new application for breeder's rights after 10 November 1994 which are immediately assignable for value, which are personal property and where the Act says with the utmost clarity, there will be complete retrospective liability for remedies and accounting under the Act if you deal with that matter when this Act comes into force, but it never will, it might never not, but nonetheless you are at risk.

In effect, there is a coercive threat saying you proceed at your peril with respect to a matter where you have no control or even knowledge as to whether or not liability can exist. Now, it may be well said, your Honours, that, on that basis, one could attack the law on the basis it is not a law at all because no subject is in a position to know how to adjust that subject's affairs to comply with it other than by doing nothing. In effect, my client is told it may well be the case, just looking for external affairs, that for the indefinite future you can lawfully continue to deal with Franklin barley because Australia may never become a party, but if it does in 18 years time, 20 years time, then you may retrospectively be liable to full accounting for what you have done including, perhaps, eighteen generations of reproduction and replication of the product.

Your Honour, that consequence is not affected by section 10. Section 10 only suspends the granting of new rights. We have already made our submissions that, we say, that with respect to the translation into breeder's rights of existing rights, there is also a creation of new rights under the Breeder's Act, and those rights are Breeder's Act. Those rights mean Breeder's Acts because there is no Variety Acts which continue in existence. Your Honours, we have sufficiently made the point that a provision such as article 30 or article 32 of the respective treaties cannot enlarge the external affairs power by expressing some requirement as to compliance of Australian laws before Australia becomes a party.

It is a bit like federal clauses. It is accepted in international law that States do their best to become parties, whether they are federal States and cannot deliver by a federalist Act or not, and treaties are dealt with and come into force with respect to those principles. We have already indicated the various ways in which Australia could comply with such a requirement and our basis of contending that, when properly understood, those provisions in no way require Acts to be in force.

Your Honour, on the colourable treaty issue, of course that is a matter such as Koowarta which is referred to in the concept of Australia entering a colourable treaty. My learned friend likens the scene in widening Pitt Street. I am in favour as the next person of widening Pitt Street, your Honour, but that is referring to a colourable treaty which Australia enters. Here we do not even get to first base. We are told that there can be any treaty out here, Kazakhstan, South America or whatever. My learned friend says the only limitation on Australia enacting without the executive in any way even indicating its attitude, let alone be committed to accede to the Treaty, is to get to this exceptional case of colourable treaty. We might get to the millennium after next before we ever find a colourable treaty if that is my learned friend's only limitation on the example. It is an inquiry that does not even arise when Australia is not a party to the Convention.

Of course, the difference in Richardson from here is that in the Richardson Case we were already a party to the World Heritage Convention. We had an obligation under that Convention to take steps to protect world heritage areas and it was held by this Court it was appropriate to protect the Lemonthyme Forest apparently with now the acquiescence of my learned friend the Solicitor-General of Tasmania that that was appropriate by reference to the external affairs power. We would say that it may well be regarded as an incidental matter to the carrying into force of the Treaty even within the external affairs power because they are already a party or by reference to the incidental power.

The incidental power can have no work here. There is nothing to be incidental to. It might be one thing to set up a statutory inquiry to say, "We'd better have Professor Lazenby with coercive powers". It is another thing to bring forward in the entire operation the provisions of the Act including this contemplated retrospective operation on the basis of one saying, "We're just getting ready". It is not getting ready for my client. My client does not know season after season whether it can deal with Franklin barley without - if the right is based on the PBR Act - without Cultivaust saying, "You just wait. When the Convention is finally acceded to by Australia, you are going to pay". Of course, it could be, as we say, 20 or 30 years of liability because of the tracing provisions of this legislation. It is not the first product.

Dealing with the issue that was raised by my learned friend, Mr Gray, with respect to the issue of the operation of the core elements of the Convention, in our submission, your Honours, my learned friend's references to core elements were not core elements; they were the fringe elements. The provisions about recognition for a retroactive date of an application by a foreign holder of plant variety rights under the laws of a Convention country is neither here nor there. The provision he relied upon as being his most prominent provision that we are required as, for example, under Article 4 of the 1991 Convention to accord foreigners the same rights of registration as locals, you do not even need a provision like that in Australia because Australia does not enact discriminatory laws of this sort discriminating between a foreigner and a local with respect to such issues of obtaining rights to intellectual property including intellectual property, properly so called within placitum (xviii).

Of course, our laws would give the same rights to a foreigner or a local. That is the way we operate. The fact that the Convention says it in each version is not a matter of any consequence. What is a matter of consequence, and this is why Mr Millett - I do not know why all these people seem to have agricultural names - is right to say there were deep problems, major differences. What has happened at an international level that in the very short period from 1978, indeed, from 1961 it was clear that this was an area that did not work very well. It was revised in 1968. It was completely rewritten to 1978 and, we say, completely substituted in 1991 - very short periods indeed because it did not work. What one had - it did not work to the extent that it threw variety rights out the window and started again.

We would rely upon the chart table 2 and 3 to my learned friend Mr Gray's supplemental submissions in answer to Western Australia as confirming what we say. If one charts up with little lines the attempts to find scattered through the articles of the 1991 Convention equivalents of the 1978 Convention as is excited by what is put as a brief summary, one will see, in effect, there is a completely new - doing it, as it were, my way, a different way. We would say, your Honour, that underlines the points that the legislation itself indicates. The explanatory memorandum says it. We are going to stop variety rights, we are not even going to continue them for those who already have them. We are going to substitute breeder's rights and they are completely different rights and, your Honours, they are different because in some ways they are more extensive, in some ways they are more restrictive.

Your Honour, the breeder's rights applies only to propagating material, that which is going to get up and get going and keep going, whereas the provisions of section 12 of the Variety Act apply to plants which do not apply to breeder's rights and applies to reproductive material but limited in the case of variety rights to production and sale. In the case of section 11 reflecting the Convention obligation, there is a limitation only to propagating material and it includes various other matters of dealing, including those listed for import/export, offering for sale, et cetera. So that one has a narrower subject matter, only propagating material. One cannot limit the sale of the good itself but one has a wider operation of the reach and, your Honours - - -

GAUDRON J: Would not the plant itself be propagating material?

MR GRIFFITH: Not within the definition of the Act, we would say, your Honour. One can walk off with the plant and that is all right. Your Honour, also we would point out the fact that there are different - - -

GAUDRON J: You can propagate from the plant itself.

MR GRIFFITH: You can do no more than rely upon the terms of the Convention. My learned friend the Solicitor-General has available to him expert evidence at home about this, your Honours. We can only do our best with the legislation.

GAUDRON J: Perhaps nothing turns on it. I just would have thought the definition of propagating material was wide enough to include a plant.

MR GRIFFITH: Your Honour, it does not seem to be the expression, we would submit. Now, it might be, with a bit of rooting hormone, your Honour, when I am finished this case and tomorrow's, on the weekend I can have a shot. But in our submission that is not what the Convention is directed to. It is directed to - - -

GAUDRON J: Seeds.

MR GRIFFITH: - - - in effect, the commercial utilisation, not just walking off down the street with one plant, certainly the breeder's rights laws. Your Honour, what we point out is the difference in extensive inclusions and extensions. For example, in the breeder's rights, one has the extensions of sections 12, 13 and 14 which do not exist with respect to varieties. It is the case that, for the provisions of 82, their operation is somewhat restricted, but nonetheless, when one is looking at the definition of breeder's rights, one says the core element is that which is provided in sections 11, 12 and 13 as being breeder's rights.

We say what is there is something quite different from what is provided for the variety rights. That is what the conventions were about. The 1991 Convention was creating something in substitution to deal with these deep problems and major difficulties that are referred to by Mr Millett in his three and a half pages, and my learned friends gloss over that. They just say, "Oh, look at these provisions that are the same". They are about the same as saying "Here is the contracting parties, here are the requirements for coming into force". The elements that my learned friend, Mr Gray, refers to are incidental, they are not the core matters, and your Honours, I have I will be excused for referring to this, but I was reading on the weekend a Latin cookbook, not very well, but my wife helps me with the Latin, and the first recipe was for "pink flamingo", and started "First, catch the flamingo", this is what the Romans did. But, of course, they had no refrigeration, so they made their strong sauces with spices to disguise the fact that the meat had gone off. The next recipe in the book was "pink flamingo without flamingo". Having made the sauce, by then the flamingo had gone off, you threw away the flamingo and ate the sauce.

In our submission, that is really what has happened here, that in each of the two levels of argument, somehow, in the middle of all these ingredients for power, both in respect to patents power and in respect to external affairs power, the essential ingredient has been lost. In the case of one it is patents for inventions, in the other it is the external affairs attaching by reason of being party to a treaty.

Your Honours, the last matter I wish to deal with, and can be done briefly, is my learned friend Mr Gray's submission that there is only one Convention. Now, your Honours, it is quickest answered by going to the 1991 Convention which appears as a schedule, of course, to the - - -

KIRBY J: I think he attaches the argument to the use in the Act, of the 1994 Act of "the" Convention.

MR GRIFFITH: Yes, your Honour, but - - -

KIRBY J: I think that is the source of the argument.

MR GRIFFITH: I am happy to start with the definition, your Honour. The definition in section 3 of the Breeder's Right Act is:

"Convention" means the -

and my learned friend relies upon "the" -

International Convention for the Protection of New Varieties of Plants, a copy of the English text of which is set out in the Schedule -

That is the same expression that applied to the earlier Act, the 1987 Act. Now, your Honour, the 1987 Act annexed, not the 1961 Convention, has annexed the 1978 version. Now, your Honour, I can do the same exercise here, but it is done with utmost clarity, we would say, with respect, and reflects what I have referred to in paragraph 2 of the explanatory memorandum of Parliament's intention. You say, "Well, what is the Convention?". It is not the International Convention for the Protection of New Varieties of Plants which started in 1961 being a continuous convention, it is the Convention, the text of which is annexed starting, in the case of my version, at page 48 of the Act, No. 110 of 1994.

Now, to define what it is about, Article 1 says precisely what it is about. It says:

Definitions....."this Convention" -

that is the Convention which is annexed to the schedule of the Act -

means the present (1991) Act of the International Convention for the Protection of New Varieties of Plants -

Now, Article 1(ii), just so you know where you stand, says the:

Act of 1961/1972" means the International Convention.....of December 2, 1961 -

the original one -

as amended -

and I referred to the fact earlier in my submissions yesterday that one could say that the 1972 variations were amendments. That is how they were expressed. And, (iii):

"Act of 1978" means the Act of October 23, 1978, of the International Convention for the Protection of New Varieties of Plants -

Now, when this Convention refers to "Act" what it is meaning is this Convention. This "Act". What "Act" means is that is a convention, it is not just something which is a continuum on someone else's convention. This meaning is confirmed completely by all the other definitions and operative provisions of the Convention. For example, "Contracting Party" is defined:

means a State or an intergovernmental organization party to this Convention -

that means 1991. It does not mean 1978. It does not mean any earlier one. Article 4 which has been referred to, "National Treatment", it refers to:

nationals of a Contracting Party -

namely, those who are parties to the 1991 Convention. Article 3, dealing with what is to be protected refers to:

Each Contracting Party -

that is parties to this Convention, 1991 -

which is bound by the -

earlier conventions - two of them:

shall apply the provisions of this Convention -

You would not have that provision if it was all the same convention. It is a new one and one can see, although mostly to make clear the fact that there are three or four conventions involved the expression "this Convention" is used in the case of this text, there are various parts of this Convention, particularly in the headnotes to articles, where there are references to "the Convention" meaning this Convention. For example, Article 30 on page 65 dealing with "Implementation of the Convention" refers to:

[Measures of implementation] Each Contracting Party -

to the 1991 Convention -

shall adopt all measures necessary for the implementation of this Convention; in particular, it shall -

do all these things that have already been referred to. Article 31 dealing with:

Relations Between Contracting Parties and States Bound by Earlier Acts -

and we say, your Honours, its plain meaning by reference to international law principles it is the case that when it refers to "Earlier Acts" it is referring to not earlier versions, pre-revision versions of the same convention but referring to different conventions which have already been defined, so, Article 31(1) says:

Between States members of the Union which are bound both by this Convention and any earlier Act of the Convention, only this Convention shall apply.

In other words, once you are a party to this Convention, that is it. You are not a party to the earlier Convention. Indeed, it had to be entirely superseded because it is an entirely new and different convention. For the purpose of coming into force, it is the case that the 1978 Convention had its own provisions requiring accession for coming into force. It was not a case of saying it is a revision to an earlier convention, therefore once you sign up to the revision it has come into force and binds you.

Each of the 1978 and 1991 Conventions had the usual provision that any original convention has, namely for a minimum number of parties. You cannot flock as a pigeon by yourself in the corner; you cannot have a convention on your own. If there was....revisions, then parties could pick up the revision and they would be bound, as a party to the original convention, who has picked up the revision. But, in the case of the 1978 Convention, and in the case of this Convention Article 37, there is the usual provision of accession by at least five States before it comes into force. Article 40 also makes the distinction we make clear:

This Convention shall not limit existing breeders' rights under the laws of Contracting Parties or by reason of any earlier Act or any agreement other than this Convention concluded between members of the Union.

So in our submission, your Honours, it is a matter of statutory construction that the reference in section 3 to the Convention is not to a continuing convention, so as my learned friend, Mr Gray, can attach the nice bits, which he says they are common, they are core, up to 1968 do not worry about the differences. In our submission, there is only one Convention which is referred to in the 1994 Act and adopted as a schedule. It is the 1991 Convention. It defines that according to its own terms. The Act specifically picks it up. The reference then in section 10(a) to the references to the Convention are references to the 1991 Convention. On that basis, our submission is that my learned friend Mr Gray's submissions can have no subject matter of ambulatory convention to attach to.

I should indicate, as is noted in the note which we handed the Court before lunch, that in the event that the Court was against us on the issues of invalidity, there is the issues with respect to the grant, or purported grant, we would say, of Franklin barley, which would require to be remitted for trial. In the event that the Court is with us on the issue of validity, then that would be the end of the matter, in our submission. If the Court pleases.

GUMMOW J: These questions that we are required to answer, it seems - I am not sure I understand them - on page 2 of the book, it goes back to a point that Justice Kirby was raising with you, with the parties, really:

Is the Plant Variety Rights Act (Cth) or any part thereof invalid in that it is not supported by sections -

the industrial property power, the external affairs power or the incidental power:

or any other head of Commonwealth power?

Section 43, for example, is supported by section 77 of the Constitution in the Variety Act. Section 79 of the Breeder's Act is supported by 51(xxxi). What do we make of all this? We are really being asked to say it is all supported, are we, which cannot be true, by either the industrial, property power or the external affairs power. It just cannot be right.

MR GRIFFITH: I see your Honour's point, it is up to us to provide the question.

GUMMOW J: Yes.

MR GRIFFITH: Yes. The difficulty is to parse the odd section that might be otherwise justified, your Honour, when - - -

GAUDRON J: Is it not the sections granting rights that you are concerned with?

GUMMOW J: Is that not really the complaint?

MR GRIFFITH: No, your Honour, because we complain about the whole operation of the Act in the way we have described even though it is suspended, so - including section 82.

GUMMOW J: Well, I have made my point. It appears.....noticed that I am obliged to do.

MR GRIFFITH: Your Honour, I am not quite sure how to answer it other than to say that I am sure the parties will do their best to bring it forward in proper form. If we could have an opportunity to do that on the basis that we will come back to the Court and possibly, your Honour, if there is some submissions to be made we could resort to Justice Kirby again. That is just a suggestion but we agree, your Honour, that, as the other matters your Honour pointed out, despite attempts to anticipate, it has not been the best result.

GUMMOW J: It would have been better to have a demurrer, I feel. I do not like demurrers - - -

MR GRIFFITH: Well, your Honour, we only plead statements of claim as plaintiffs, but, yes.

GLEESON CJ: The document on page 2 of my copy of the book is undated and unsigned.

MR GRIFFITH: Your Honour, there has been a substitute page which was filed, which should be collated as - that was observed, your Honour, and that was filed together with a copy, I think, of page 5 and also page 43 was retyped so it could be read. So, your Honour should have a dated version.

GLEESON CJ: It is signed, is it?

MR GRIFFITH: Yes.

GLEESON CJ: Thank you.

GUMMOW J: Are you not really.....sections 5 and 10?

HAYNE J: And how do you take account of 5 and 10 in answering those questions?

MR GRIFFITH: Your Honours, it is not just 5 and 10 because we complain about the immediate operation quite apart from 5 and 10.

GAUDRON J: Well, it is, as it were, the prospective retrospectivity of which you complain, is it?

MR GRIFFITH: Yes. Well, the existing risk, your Honour, we say, yes. We are affected today. We cannot plant Franklin barley without, if it is just external affairs, being at risk that whatever our legal rights now, they will be retrospectively affected if Australia ever becomes a party, on our argument. But, your Honours, it is unfortunate that the parties did not get this in form to address these issues. I am afraid I can offer no more than say that I am sure we will as soon as we can, if we could have liberty to mention it - - -

McHUGH J: Is it your point that the whole Act is invalid and none of it is severable?

MR GRIFFITH: That is our basic approach, your Honour, except for section 78 if needs be, but we do not need that because we say both are bad so our basic point is they were all invalid.

GUMMOW J: Even 78?

MR GRIFFITH: Your Honour, 78 might not be needed because the earlier Act might be invalid anyway.

McHUGH J: It would go down.

MR GRIFFITH: I suppose it could still could be repealed as an invalid Act, your Honour, 78. But that is our basic point, that the Acts entirely fail and the old section that might be supported by some other power would not stand on its own. I am not sure then how far we can go to meet the point your Honour Justice Gummow has an expression of an order but if we are right, your Honour, we would suppose this would be one of the occasional cases one has in the Court where you just walk away from the Act. The whole thing is gone.

GUMMOW J: You want to say that the question is - and you say there is a clear, positive answer - the question is: is the Plant Variety Act 1987 invalid?

MR GRIFFITH: Your Honour, that is right.

GUMMOW J: You say yes.

MR GRIFFITH: The reference to powers that were put in, your Honour, is just to help understand what were the issues.

GUMMOW J: And you rise or fall by that. That is not what the question says.

McHUGH J: The problem is section 15(a) which reverses the common law presumption. One has to hold valid what one can.

MR GRIFFITH: Your Honour, one problem is, of course, that one can never say that a declaration of this Court for all time has held a law valid. One might say - or that is what I used to say, your Honour. It is only for the moment held not invalid until someone thinks of another argument.

GUMMOW J: No, but it has great effect in trade and commerce, I would have thought.

MR GRIFFITH: Possibly so, your Honour, but - - -

McHUGH J: I mean, legislation stays on the statute even though it has been declared invalid by this Court.

MR GRIFFITH: Yes, but properly read, your Honour, an order of the Court is, we would say, in effect, to say that a law is not valid rather than saying it is valid. Even if the Court order was that it is valid, we say that is only until the next argument comes.

KIRBY J: A problem has been raised with you, and I think you have indicated you are going to think about it and discuss it with the other parties and if you come to any view then that ought to be promptly put before the Court so that it can consider whether the question should be amended.

MR GRIFFITH: We will, your Honour, but it may well be that, as Justice Gummow suggested, our basic point is each Act is invalid. If the Court pleases.

GLEESON CJ: Yes, thank you. Now, Mr Gray, you are going first in the next matter, I believe.

MR GRAY: May it please the Court. The Court has the outline of agreed facts, matters and documents and I just wanted to touch on certain matters of the background before moving into the more substantive parts of the argument. The State of Tasmania was responsible for the development of Franklin barley, and so at one point our submission is that the Grain Marketing Act 1975 is claiming a monopoly in that which Tasmania developed to, as it were, pitch it at the most obvious.

My client holds an exclusive licence from Tasmania for a period of 10 years including the right to a sub-licence. My client's licence involves the territory which is everywhere except Tasmania. That is both within and beyond Australia. As the Court would have seen from paragraph 9 of the agreed facts where we have extracted some of the terms of the licence agreement, my client has obligations to produce seed in commercial quantities in an endeavour to satisfy foreseeable demand to ensure that seed meets the minimum quality standards in any country where it is being sold.

If the Court pleases, it is against that background that one comes to look at the relevant legislation. The Variety Act as well as the Breeder's Act both have a common purpose: to protect the breeder. In a sense there is a public interest in that protection to provide incentive and reward to encourage the production of new plant varieties. One of the purposes of that is of course for the development of food sources in regard to worldwide interests in food sources. At the same time both Acts have a balance and the balance is public interest. If one looks at the various sections of both Acts that deal with acts that do not infringe, they are invariably public interest based, for example, experimental purposes, non-commercial purposes, farmer save seed and, if properly dealt with, use as food. They are not, as it were, limitations on the exclusive rights granted. They are in the nature of defences to claims for infringement. They are said not to amount to infringement.

Part of the way in which the Acts provide that public benefit is to cast a positive obligation on the grantee of the grant to provide and meet the public need. So, quite apart from being an exclusive licence in that sense to exclude others, the Act does cast a positive obligation in regard to supply. If the grantee does not meet that, then the secretary either on his own behalf or on the application of a member of the public can go through a process to grant licences to ensure the public need is met.

GLEESON CJ: When you are talking about the public need, which public?

MR GRAY: It is the consuming public of Franklin barley in this case but, in general, it is - - -

GLEESON CJ: The Australian public?

MR GRAY: We would say the Australian public, yes. Certainly, the public in Western Australia.

GLEESON CJ: Including the public in Western Australia.

MR GRAY: Yes, and what has happened in this case, if one looks at the licence agreement, is Tasmania has gone about meeting that obligation by passing that through the licence agreement to my client. So that, when one looks at the relevant parts of the Acts, one is concerned with that aspect as well and that is all in regard to what we would describe as the public benefit aspects of the Act.

Now, to start the analysis in the statutes, I would start with the Variety Act and, as your Honour Justice Gummow mentioned earlier, the correct starting place is section 30. It is at page 50 of the book. That identifies the plant variety rights as personal property and capable of assignment but, in particular, section 30(3) has a relevance because it provides:

Where the grantee of plant variety rights gives another person a licence in respect of those rights, the licence binds every successor in title to the interest of the grantee in those rights to the same extent as it was binding on the grantee of those rights.

So, by talking about something that is more than a mere licence or a bare licence, we would say that it is in the nature of an interest in property itself by reason of this statute.

KIRBY J: You are examining the Variety Act, although repealed, because of the transition provisions of section 82.

MR GRAY: Yes, and because the Grain Marketing Act operated in respect of this Act prior to the repeal. The equivalent section of the Plant Breeder's Act, if I might just jump ahead for a moment, is section 20. There is a slight difference of wording. This is at page 94 of the book, section 20(1) again identifies PBR as:

personal property.....capable of assignment -

and subsection (3) provides:

If a grantee of PBR -

and PBR is defined as the plant breeder's right -

in a plant variety gives another person a licence in that right, the licence binds every successor in title -

So that, we would say that properly characterised, the licence is, by reason of the statute, if appropriately worded, a licence in that right and we would draw to contrast, it is a lease over land rather than a licence to use, or it is an easement rather than a licence to pass. Now, the next step, we respectfully submit, is to move to the nature of the rights, and in the Variety Act at section 12 on page 40.

the exclusive right to sell, including the right to license -

is in 12(1)(a), and other exclusive rights are provided to sell and license in regard to reproductive material; and then parallel wording in regard to production of the plant and in reproductive material.

GUMMOW J: You are talking here about 12(1)(a) or (b), the plants are dead, relevantly, are they not?

MR GRAY: Yes.

GUMMOW J: So, is it (b), that there is still reproductive material?

MR GRAY: Yes. In the case of Franklin barley, essentially the part of the plant that is of value, on current knowledge, is, of course, the seed, which happens to be the reproductive material. But that is not to say what - - -

GUMMOW J: What is the relevant plant?

MR GRAY: The relevant plant is Franklin barley in this case.

GUMMOW J: Yes, I know. But what do you mean by barley? Do you mean the seed, or do you mean that which produces the seed?

MR GRAY: No, we would say the relevant plant is the entire plant. It happens in today's science, as we understand it, that the seed is what is of commercial value.

GUMMOW J: Yes.

MR GRAY: It is not to say that in 10 years' time, or five years' time, other parts of the plant might not be of real commercial value. So, in looking at the Act, one has to - - -

GUMMOW J: What do you say The Grain Pool would be doing that it should not be doing?

MR GRAY: The Grain Pool seeks to set up a monopoly in regard to Franklin barley.

GUMMOW J: In relation to the seed?

MR GRAY: Yes.

GUMMOW J: So, therefore, that clashes, you say, with 12(1), which paragraph of the Variety Act?

MR GRAY: We would say 12(1)(a), in that it dealing with part of the plant, and 12(1)(b) in that it is dealing with a reproductive material.

GUMMOW J: Thank you.

MR GRAY: I just hesitate for a moment, your Honour, because I want to check the definition of "barley" under the Western Australia Act. I think it is section 20 - yes, "barley", in the Western Australia Act is defined at page 157, but it is an inclusive definition.

includes a sample of cereal containing not less than 60 per centum of barley grain or seed.

It is also, of course:

"prescribed grain" means barley - - -

GUMMOW J: That is all it says?

MR GRAY: Yes.

GAUDRON J: So, for the purposes of the Variety Act, there is no difference between grain and seed?

MR GRAY: No, your Honour.

GAUDRON J: But they wish to sell it as grain, not as seed, I take it?

MR GRAY: Yes. In common parlance, they are selling barley grain.

GAUDRON J: Yes.

MR GRAY: It might be used as seed, or it might have other uses. If the Court pleases, section 12(2) identifies that there can be some conditions under section 33 and 34 of the Variety Act and, in particular, 34 is allowing the Minister to impose non-specified conditions. But, more relevantly, section 39 deals with this question of the obligation for meeting "the reasonable requirements of the public". Section 39(1):

For the purposes of this Act, the reasonable requirements of the public with respect to a plant variety in respect of which plant variety rights subsist shall be deemed to be satisfied if -

et cetera. And, under (2):

The grantee of plant variety.....shall, subject to any conditions imposed.....take all reasonable steps to ensure that the reasonable requirements of the public with respect to that plant variety are satisfied.

Under subsection (3) the Secretary can, on his own initiative license to overcome a failure to comply with section 39(2), and under subsection (4) a member of the public who considers the grantee is not meeting those rights can make application to the Secretary. There follows then a procedure for the Secretary handling that and, ultimately, he can license.

HAYNE J: Would the reasonable steps under 39(2) extend to imposing conditions on end use on those who might take the grant?

MR GRAY: We would say that it could if the end use was considered to be an absolutely wasteful use that was wasting a resource.

HAYNE J: Could your client impose a condition on a purchaser that only a portion of it will be used for reproductive purposes and the balance shall be used for malting? Absent agreement to that condition, would it nevertheless have taken all reasonable steps?

MR GRAY: The answer is it is the Minister who would impose the conditions under 34. Under the - - -

GUMMOW J: But the involvement of the Secretary on the agitation of a person aggrieved and so on, that would attract the operation of the Administrative Decisions (Judicial Review) Act, would it not?

MR GRAY: Yes, I understand it does. There is - - -

GUMMOW J: Unless it is excluded in some way.

MR GRAY: No. So that, at - - -

GUMMOW J: So it could become justiciable, in other words.

MR GRAY: Yes.

KIRBY J: The Secretary is defined as "the Secretary of the Department" but "Department" if not defined. Who is the Secretary?

MR GRAY: I cannot answer that immediately, but I will have that looked up. If the Court pleases, if I might just jump ahead for a moment - - -

GUMMOW J: You would have to go to the administrative arrangements, would you not, issued under the executive power, to find who was administering each department?

MR GRAY: Yes, ultimately it is at page 58, section 39(10) that has the Secretary imposing the terms and conditions as the Secretary determines in regard to the license. I will come to the details later, but we say the effect of the Grain Marketing Act and, in particular, section 22, of course, would preclude the operation, or at the very least materially impair the operation, of these provisions in the public interest. Turning to the - - -

HAYNE J: How? How would there be that impairment?

MR GRAY: Because under the Grain Marketing Act, the only person who can buy or sell, subject to the Grain Marketing Pool's permission, is the Grain Marketing Pool. It has an exclusive monopoly in regard to both buying and selling.

Now, if the Court pleases, under the Plant Breeder's Act, the relevant comparable provisions are section 11 at page 90. We would say that section 11 is essentially doing the work of section 12 in the earlier Act and that the matter is being spelt out in section 11, either spelt out in the earlier Act, or implicit or inferred. On this occasion the Act is described as being "Subject to sections 16, 17, 18, 19 and 23". Of those, they are what we would describe as public interest matters.

Sections 16, 17, 18 and 19 speak in language of, where relevant, of no infringement, 23 does, on its terms, speak to limit the right of the exclusive right. Section 19 is the comparable section to section 39 and the Court will see on page 92 that section 19(1) provides that the grantee:

must take all reasonable steps to ensure reasonable public access to that plant variety.

In (2), in particular, at "reasonable prices", so it is contemplating a positive obligation, we would say, on the holder of the grant to meet reasonable public access at reasonable prices.

HAYNE J: Whatever the plant and whatever the circumstances. Is that right?

MR GRAY: That is right.

HAYNE J: Thus, if I develop a new strain of cannabis and can register it, this operates, does it, to oblige access by the public. That cannot be, can it, Mr Gray?

MR GRAY: It does not oblige access by the public.

HAYNE J: But obliges me to, what, take reasonable steps to make it available to the public?

MR GRAY: To make it available, so that if there is a public demand that is reasonable you must take reasonable steps to meet it.

HAYNE J: Whatever may be local law prohibiting sale of cannabis or restricting sale of cannabis?

MR GRAY: We would say subject to the criminal law of the land, subject to matters such as health and regulation, but not subject to a local statute that seeks to create a monopoly in regard to the marketing of the product.

McHUGH J: But why? How do you distinguish between the two? They are both laws passed by the relevant Parliament in what is perceived to be the public interest of the particular sovereign.

MR GRAY: The difference is that one strikes at directly the monopoly being created in the Commonwealth law and we would say would directly conflict with it.

McHUGH J: But to take Justice Hayne's example about cannabis, so would a State requirement that all cannabis be forfeited to the Crown.

MR GRAY: But in that case, particularly under contemporary thinking, there would be a criminal and a health aspect to it.

HAYNE J: Let me change the example to a new strain of digitalis. Let it be assumed that local State law requires that all strains of digitalis be sold only through pharmaceutical chemists, not an unusual sort of provision. How do the two Acts then intersect?

MR GRAY: We would say that there may well be a reasonable public interest of health to allow that to occur.

McHUGH J: Yes, but what is the constitutional doctrine that enables you to draw this distinction about public health? I mean, the Commonwealth legislation gives you this absolute right or it does not or do you read something into the Commonwealth legislation?

MR GRAY: We would say that one would have to allow for a respecting of, for example, the criminal law of the State. One would read that in, but if one is dealing with the simple issue of the marketing of the product, the Commonwealth law intended its law to prevail, otherwise this whole protection would be set asunder by any State legislation that wished to legislate in regard to a monopoly position.

McHUGH J: What about a State law which required all barley to be inspected by State officers and if not in accord with certain standards to be forfeited or not to be sold?

MR GRAY: We would say that law would not be going to dealing with a commerciality of sale but would be dealing with a quality of the product, to, for example, deal with quarantine matters and as such the law would be characterised as not being in conflict. It would not be, per se, seeking to address the exclusivity of sale, rather, it would be addressing the question of quality control.

HAYNE J: But part of the solution - I emphasise "part of the solution" - may lie, may it not, in understanding what is meant in 19 of the Breeder's Act, and 39 of the Variety Act, by "all reasonable steps to ensure reasonable public access".

MR GRAY: Yes.

HAYNE J: The notion of reasonableness takes on particular significance, does it not, in dealing with the cannabis example, perhaps the digitalis example, but may also, may it not, bear upon whether somebody having an exclusive right in respect of a new seed need do more than say, "I will offer it for sale or I will make it available into the world of commerce on terms that no more than X per cent of it is used for seed purposes and the balance is used, in your case, for malting purposes". That may be all that reasonable steps may require of that particular plant breeder, may it not?

MR GRAY: Yes.

HAYNE J: Now, there are other problems that need to be addressed later about the nature of exclusive rights of sale and so on, and you will come to those in due course.

MR GRAY: Indeed.

HAYNE J: But, we need, do we not, to pause at "reasonable steps"?

McHUGH J: I add to what Justice Hayne has put to you. Supposing a person with these rights is in North Queensland, but, we are talking about the Commonwealth public here, one assumes. All that the person surely requires is to take such steps as are reasonable, having regard to his or her position in North Queensland to supply to a relevant area or section of the public in Western Australia or maybe Tasmania or somewhere.

MR GRAY: We would say that, if the Court pleases, one of the prices that a holder of a grant would have paid for his grant was facing up to meeting the responsibility of meeting public need and that the critical words are - what has to be ensured is reasonable public access in Australia and the reasonable steps to be taken would be governed by that, and that is why, with respect, the Act speaks of "rights of assignment" and "rights of licence" because it is recognising that the developer and the holder of the grant might have great skills in that area but no skills in regard to, for example, marketing matters.

McHUGH J: But subsection (2) is not concerned about sale so much, it is concerned about production.

MR GRAY: Well, 19(2), your Honour?

McHUGH J: Section 39(2) I am looking at.

MR GRAY: Yes. We would agree that the matter is not spelt out there but if your Honour would look at the wording of 19(2) where one is dealing with the same concept, we would say what is implicit earlier is made clear here that there is to be a reasonable price. That is, a price that would return a reasonable margin to the person marketing. What was in issue here was that, "Yes, we will give you exclusive rights but a price of that is that you must act in a way, either directly or through your licensee or assignee, to make sure that the public interest is met."

If one takes the language of the Statute of Monopolies, even that contained within it the condition that there would be conduct so that prices would be maintained, even back at that time. So that the Act is seeking to balance the respective interests. Now, when one then comes to some State legislation that, on its face, is dealing with exactly the same issue, namely, the monopoly in regard to marketing, that - - -

GAUDRON J: Is it marketing generally or exporting?

MR GRAY: It is identified as the sole marketing authority and its activities are both, under the earlier regime, in the State and out of the country. Under the amended Act it is dealing with export.

GLEESON CJ: Is the barley to which it is referred, barley grown anywhere in Australia?

MR GRAY: Yes. Well, any barley coming into Western Australia.

GLEESON CJ: Any barley coming into Western Australia.

MR GRAY: I just hesitate because I would like to check the wording on that.

GUMMOW J: One has to read some words into it, I think.

MR GRAY: It is certainly any barley grown in Western Australia.

GLEESON CJ: In that it includes that.

MR GRAY: It certainly includes that.

GUMMOW J: Where do we get that wording?

MR GRAY: Well, if we could go to the Grain Marketing Act - - -

GLEESON CJ: The definition of "barley" does not seem to help.

MR GRAY: Section 22(1) at page 165 expresses:

The Grain Pool is the sole marketing authority of prescribed grain.

"Prescribed grains" is at section 20, which identified barley.

GLEESON CJ: I was looking at page 212.

MR GRAY: Yes, your Honour is dealing with the 1997 amendment and again in 22(1) your Honour has the "sole marketing authority of prescribed grain" and "Prescribed grains" barley. So, your Honour, we would say that it is - - -

GLEESON CJ: What about barley grown in New South Wales?

MR GRAY: Your Honour, section 22(1) is dealing with anything sold for export from the Commonwealth so it has to be any grain, from whatever source, any barley grain in this case - - -

GLEESON CJ: .....that Western Australia has legislated to produce the result that if somebody grows barley in New South Wales, they cannot export it from the Commonwealth.

MR GRAY: On that interpretation, yes. The other would be if New South Wales barley was being brought into Western Australia.

GUMMOW J: Is there any provision in the Interpretation Act in Western Australia which would operate upon subsection (2) so that you had "a person in Western Australia shall not".

MR GRAY: I cannot answer your Honour immediately.

GUMMOW J: Otherwise there is a problem with validity of this.

MR GRAY: Yes.

McHUGH J: Mr Gray, why should we construe the Plant Breeder's Rights Act as dealing with these questions of interstate trade? Why is not the proper approach to the construction of the legislation to regard section 90, section 92 of the Constitution as dealing with these issues?

MR GRAY: It may, but equally from my client's perspective it is saying that it holds under Commonwealth law an exclusive right, the State of Tasmania is, my client through his licensee, and that that is to protect its rights throughout the Commonwealth.

KIRBY J: But the federal law must be subject to section 92. I was looking for any mention in the parties' submissions to section 92 and I looked and found nothing.

MR GRAY: We would say that this rather depends on the characterisation of the Western Australian Act which - what it does do is to purport to set up a monopoly.

GLEESON CJ: Yes, but that is not what you were being asked about. What is the effect of the Western Australian Act? You have said it includes creating a monopoly concerning the export from the Commonwealth of barley grown in Western Australia, but is that what it is limited to? Is there a provision of the Western Australian Interpretation Act that limits the territorial operation of sections 20 and 22(1)?

MR GRAY: I cannot presently answer that question, if the Court pleases.

GUMMOW J: We have to read it down in some way, otherwise it is invalid, because it does not have a sufficient connection, even a remote one, with the State of Western Australia in prescribing criminal offences.

MR GRAY: Yes. I am, with respect, reading it down as dealing with grain being, in effect, produced and dealt with in Western Australia.

GLEESON CJ: What if it comes into Western Australia from New South Wales?

MR GRAY: Once a person is dealing with it within Western Australia, it would be potentially caught.

HAYNE J: So are we to read 22(2), do you say, as "a person in Western Australia other than", et cetera, or are we to adopt some other reading?

MR GRAY: We would say that interpretation would be open, yes.

GUMMOW J: What is it that gets the grain into the hands of the Grain Pool as a matter of legal obligation rather than inducement?

MR GRAY: If the Court pleases - - -

GUMMOW J: I was looking at section 29.

MR GRAY: Yes. We would suggest your Honour could start a little earlier in the analysis.

GUMMOW J: Maybe section 25?

MR GRAY: Yes, section 25 identifies the - if I can deal with the earlier version of the Act - - -

HAYNE J: At some point you will need to explain to me why we are dealing with the earlier version of the Act, but do not delay now.

MR GRAY: Thank you, your Honour. The reason, your Honour, is that my client says that it has been precluded from the market at a time where that Act operated and the Commonwealth Acts operated, a period from, I think, 1992 until 1997 and then from 1997 until to date and the future the amended Grain Marketing Act operates.

HAYNE J: Yes, but the action, I thought, was presently framed as action for declarations, not action for some other civil wrong leading to some other relief, but perhaps I am mistaken.

MR GRAY: No, your Honour is correct. There is, in the Act as it is presently framed, a claim for declarations.

HAYNE J: It is not immediately apparent to me at all then why, in an action for declaration, we should be concerned to declare the position in relation to past Acts.

MR GRAY: The reason, if the Court pleases, is that this has been an ongoing dispute between the parties from pre-1997 and the declaration process is seen to be the immediate step through into that issue but there are legitimate commercial interests that relate to it.

GAUDRON J: Has somebody got barley somewhere that has to be delivered to the Grain Pool under the old Act or is it the case that the Grain Pool received barley under the old Act? Which?

MR GRAY: Yes. The latter.

GAUDRON J: So the Grain Pool has, in fact, got the barley, your client's barley, you say?

MR GRAY: Barley in which my client's rights should have been respected.

GAUDRON J: It was not barley that your client grew, or was it?

MR GRAY: At the outset there was some seed provided by my client but under the Variety and the Breeder's Acts, my client has rights in regard to other sales.

GAUDRON J: All right. You go so far as to say the Grain Pool has to give that barley back to someone?

MR GRAY: It would be a question of an account.

HAYNE J: That is exactly what you are not claiming.

GAUDRON J: Yes, exactly. There has to be some present right and we have to know exactly what that right is before we could entertain a claimed present right, before we would deal with a matter like this on the basis of a declaration, I think.

MR GRAY: Yes. Historically, what has happened is that Franklin barley has been grown in Western Australia for some years in the 90s.

HAYNE J: I have no doubt there is a long and deep history. It may be a history of great enmity but is there a present legal claim that requires us to consider the past Act. If there is not, why should we?

MR GRAY: If the Court please, the matter stems from the correspondence that is referred to in the agreed statement of facts and, in particular paragraph 12 and the plaintiffs wishing to run a grain pool for Franklin barley in Western Australia and that matter being - - -

GAUDRON J: I do not understand what that is. What do you mean advising that you want to run a grain pool?

MR GRAY: My client being able to, in Western Australia, buy and sell grain.

GLEESON CJ: The case stated does not seem to deal with any Western Australian legislation other than the Grain Marketing Act.

MR GRAY: No, it does not. The two Acts, the earlier version and the 1997 amendment.

McHUGH J: We are not told what are the facts, whether you have been given any notices. Apparently you have not, from paragraph 12. You have merely written a letter, and got a letter back in reply.

MR GRAY: The substance of the correspondence, if the Court pleases, is that my client faced a section in an Act, and the amended Act, that would make it a criminal offence to it to do what it wished to do. It took up the matter, and was told that the Western Australians took a different view about it. My client then raised the question of the inconsistency between the Grain Marketing Acts and the Variety and Breeder's Acts, and the issue of 109, and was met with the response, "We are going to fight that", but additionally we say that the Commonwealth Acts are invalid. Hence, both issues coming forward.

McHUGH J: But you say plenty about your own issue, but you do not say anything about what you intend to do in Western Australia, or in terms of your pleading. There is nothing concrete there at all. One would have expected that the statement of claim would have set out facts alleging that you wanted to start a business in Western Australia; you wanted to do this; you wanted to do that, and you were being threatened with legal action. There is nothing there.

GUMMOW J: There is a toehold in paragraph 9 on page 5. Then there is a defence for that at paragraph 4 on page 30, and there is a reply to that, I think.

MR GRAY: Yes.

GUMMOW J: What is the reply?

GAUDRON J: Why would you be seeking permission?

MR GRAY: The effect of the statement of claim and defence and reply, is to lay out the correspondence that identifies the core dispute between the parties.

GAUDRON J: What right do you assert which you say is being frustrated by this legislation? Your statement of claim says you have asked for permission.

MR GRAY: The rights that we say are frustrated are the exclusive rights to sell in Western Australia and, in particular, with that, the obligations we have to see that the Western Australian public demand is reasonably met.

HAYNE J: Why is that forbidden by the current Act, when it speaks of export from the Commonwealth? Why are you forbidden from satisfying Western Australian domestic need, or have I missed something entirely?

MR GRAY: No, if the Court pleases. One of our rights under the Breeder's Act, are the sole rights in regard to export. Under section 11 we have, we would say, the sole rights of export. This Act gives the sole rights of export to the Grain Pool.

HAYNE J: What is it your client wants to do in Western Australia? It wants to do something, what?

MR GRAY: It wants to, in terms it, operate its own grain pool, that is, become involved in the marketing - sale, the marketing of grain in Western Australia, including export.

GUMMOW J: And you have been told - and it is admitted paragraph 4(b) of the defence on page 30 - you have been told by the Grain Pool that if you do what you are proposing to do you would be contravening section 22.

MR GRAY: Yes.

GLEESON CJ: But you have not yet done it?

MR GRAY: No, because we face - - -

GLEESON CJ: So the issue, then, is going to concern the relationship between the current Western Australia legislation and the legislation on which you rely?

MR GRAY: The reason we have not done it is that if we do it we face criminal penalties.

GLEESON CJ: But you might have been bluffed out of doing it in the past by reliance upon some inoperative legislation but, for whatever reason you have not done it, what you want from this Court is a declaration that you are entitled now to do it.

MR GRAY: Yes, particularly when we have been threatened with criminal consequences.

GLEESON CJ: Right. Now, what has the pre-existing legislation to do with the question, not whether in the past you were bluffed out of doing something you were entitled to do but whether now you are entitled to go ahead and do it.

MR GRAY: No, the previous legislation deals with events that occurred historically.

GLEESON CJ: Why are they of interest?

MR GRAY: Because my client would wish to pursue claims in respect of past events as being - - -

GLEESON CJ: Claims for damages?

MR GRAY: Account in damages and has been met with the answer that the Grain Marketing Act, on the face of it, provides sole rights to the Grain Pool.

McHUGH J: What sort of an action for damages?

MR GRAY: It would be an action for damages for infringement of Variety and Breeder's Rights.

McHUGH J: Your rights have not been infringed.

GLEESON CJ: It sounds like an action for damages for bluff.

HAYNE J: There are a few of them about.

McHUGH J: Your rights have not been infringed in the slightest. You have not exercised any rights. You were asking for permission and they said they would not give it to you.

MR GRAY: If the Court pleases, yes, those rights remain and the point can then be taken and argued in that litigation but what in fact has happened here, of course, is that the question of inconsistency arises at the statute level, and - - -

GLEESON CJ: Just a very minor point, but it may be of some significance, the first declaration that you seek is on page 7 of the case stated book. Should we in that declaration insert the words "was and" before the word "is"?

MR GRAY: Yes.

GLEESON CJ: Now, assuming we were to make that amendment, what would be the legal basis for making a declaration that something was inconsistent?

MR GRAY: The legal basis would be a comparison of the legislation. The issue of inconsistency is addressed, of course, at a comparison with the legislation. If the Court was concerned that the declaration was, as it were, a barren declaration, it is common ground that there are commercial interests that lie behind this and so that it is not a barren declaration. If this legislation is valid then it would affect the entitlement of my client.

GLEESON CJ: So, what you seek in relation to the past legislation is declaratory relief from this Court about past inconsistency that might then form the basis for some action that you would commence in another court at a future time claiming an account of profits or damages or other relief?

MR GRAY: Yes, and in regard to the amended Act, it is dealing with the issue to date and in the future.

GAUDRON J: I mean, given the power to make declarations is discretionary, why should we make a declaration as to past inconsistencies which you will then go and use to found another action? Why do you not just go and commence your action?

MR GRAY: If the Court pleases, if that step had been taken, no doubt the same point would have come up to be dealt with in the same way.

GAUDRON J: Yes, but one usually, if there is a claim to vindicate a legal right, lets the court in which that claim is brought determine whether there is such a right free of a declaration in advance from this Court.

HAYNE J: On some, only of the facts.

McHUGH J: Yes, we do not even know what your cause of action is and whether you have one.

GAUDRON J: And I have no idea of whether you have any barley.

MR GRAY: If the Court pleases, we accept that that substratum is but - relected in a limited one but my client stands without - it is not a question of a theoretical interest.

KIRBY J: But would the legal questions that would have to be resolved for the purpose of resolving the current inconsistency which you assert, in effect, resolve the issues for the past inconsistency by way of analogous reasoning or reasoning or inference from - - -?

MR GRAY: They would certainly go a long way but one cannot say they would necessarily resolve them but the principles would - - -

KIRBY J: You are asking a lot of the Court, really, to make a declaration in respect of a cause of action which you cannot frame and in respect of an action which you have not commenced on facts which we do not know.

McHUGH J: And in respect of a legislation which has been repealed.

MR GRAY: If the Court pleases, one would accept all of that except that the.....inconsistency argument, of course, is addressed on the face of the legislation and the underlying facts, apart from identifying that there is a real issue, then do not have a relevance.

GUMMOW J: Now, I still do not understand. There are some consensual grain pools. Did you want to set up one of them and does the Act contemplate them, the WA Act contemplate them?

MR GRAY: No. My client is simply using "grain pool" in a colloquial sense of saying it wants to engage in the marketing, selling and exporting of grain.

GUMMOW J: Yes. So what you were seeking, really, was an authority in writing under 22(2). If you have that you cannot be prosecuted?

MR GRAY: Yes, because that, of course, raises another point because 22 - - -

GUMMOW J: I am just trying to work out what the actual crunch point was.

MR GRAY: That is a crunch point because looking at 22A, for example, in the old Act, it gives the Grain Pool the exclusive right to licence.

KIRBY J: Did you seek such an authority or do you take the view that the Western Australian Act was not invalid and therefore, that they had no business giving you licences or not?

MR GRAY: It is the latter view that we took that we held the right to license, or Tasmania, and it was exclusive and this legislation, on its face, although speaking of permits was, in substance, claiming the right to license.

GAUDRON J: But you did have some barley to sell, did you?

MR GRAY: Yes, my client obtains barley, in particular, under the licence agreement. Tasmania has an obligation to provide seed barley to my client if it cannot be obtained.

KIRBY J: I am still worried about section 92 here. I mean, nobody wants to talk about section 92. It is like the wall, no one talked about section 92, but this license of Tasmania does seem to be preventing the free flow of goods and products across the borders of Australia, which is something which our Constitution forbids.

MR GRAY: Your Honour, could I just say this: that from the litigant's point of view, it was hoped that this narrow, discrete bite of legal argument would resolve the problem.

GLEESON CJ: Does your client grow barley in Western Australia?

HAYNE J: If it does, it does not plead it.

MR GRAY: I think it does but it does not do it directly.

GLEESON CJ: Well, then the question of the meaning of the word "barley" in the Western Australia legislation and, in particular, whether it is limited in its meaning to barley grown in Western Australia, might dispose of the entire dispute, might it not?

MR GRAY: No, because my client would say that, for example, no, we would say not, because here we are, your Honour, my client wishing to exercise exclusive rights, including licensing, in effect exercise its monopoly rights, in Australia, and in Western Australia that very monopoly is in somebody else.

GLEESON CJ: But if you do not grow barley, if none of the grain with which your client is concerned is grown in Western Australia and if barley in this Western Australia legislation means barley grown in Western Australia, then there is no live issue between you, is there? Now, maybe it does not mean that but that is how we began this discussion, inquiring as to the reach of the Western Australia legislation which, if not read down in some way, seems to have some fairly surprising consequences.

McHUGH J: And can I put this to you, Mr Gray, that before you determine whether the Western Australian legislation is in conflict with any federal law, do you not have to look at the operation of the Constitution on the Western Australian legislation? It may be that section 22 could only have a quite narrow scope of operation by reason of, say, section 92 of the Constitution. So that any conflict between the federal law - or apparent conflict between the federal law and the Grain Marketing Act as properly construed may dissolve. There may be none.

MR GRAY: It would depend on the restricted operation that was left, but if it still retained, for example, any form of monopoly right in a discrete area it would still, we would stay, be a direct contradiction of my client's monopoly rights and Tasmania's monopoly rights as breeders and licensee.

McHUGH J: That is another question. You may not have any monopoly rights, having regard to section 92 of the Constitution. There may be a serious question as to whether, in so far as this legislation seeks to give you exclusive rights to sell, that it infringes section 92 of the Constitution.

KIRBY J: As between the States of Australia as distinct from the rest of the world.

MR GRAY: Quite so, but it would still leave, we would say, well and truly an issue - a post 1997 issue - that is, my client's exclusive right to export.

GUMMOW J: Yes, I know, but where is the threat, given paragraph (e) on page 31? All of this correspondence was designed to smoke the Grain Pool out as to what they were going to do to you if you went ahead and actually brought some barley in for marketing. You were told they would not prosecute you, were you not?

MR GRAY: We were told by the Grain Pool that their policy was of non-enforcement but they were saying, in effect, that the sword would remain hanging. They were not accepting that it was not a breach so they would have - that is only policy, that could change at any stage, and would not provide any satisfactory remedies.

GUMMOW J: In that sense it is like Croome's Case to some extent.

MR GRAY: Yes.

GUMMOW J: The question is whether that founds a sufficient controversy really to make a declaration.

KIRBY J: There is nothing in the Western Australian submissions that suggest that it does not. There is no point taken as I read the submissions on any of the matters that have been discussed with you since we began this hearing, of this part of the matter.

MR GRAY: No.

GLEESON CJ: We will hear what Mr Meadows has to say about this tomorrow, but in your submission, are the words of sections 20 and 22 of the current Western Australian Act to be read literally or are they to be read down in some way and, in particular, are they to be read down by reference to some kind of territorial considerations?

GUMMOW J: There is a Union Steamship problem too there.

MR GRAY: Yes, your Honour, we would submit that they would be read down. If not read down, it would represent a fundamental contradiction of our rights. If read down to Western Australia, they would still represent a significant - - -

GLEESON CJ: Let us forget about your rights for the moment. On the construction of the Western Australian legislation, assuming that your dispute with these people did not exist, would those words be read down in any way? Do they mean that if a New South Wales grain producer grows barley in New South Wales the Western Australian Grain Pool has the sole authority to export that from the Commonwealth?

MR GRAY: We would say that would be read down.

KIRBY J: Presumably "barley" is referring to generic barley. It is not referring to any particular strain, it is generic?

MR GRAY: Yes.

KIRBY J: And that is a global seed, it is not just something peculiar to Australia?

MR GRAY: That is so. Barley, for example, identified in the UPOV Convention papers. So, it is at large.

KIRBY J: It is also identified in the Old Testament. It has been around for a long while.

GLEESON CJ: While I certainly have no details of it, I have an impression from something that I have read, that Lupin is a quite controversial crop at the moment.

MR GRAY: I cannot advance that.

GLEESON CJ: What do you say is the reach of section 22?

MR GRAY: On its face it applies and it would go to export from the Commonwealth. Section 7 of the Western Australian Interpretation Act does provide a reading down, so it does not exceed power.

GUMMOW J: What does it say?

MR GRAY:

Every written law shall be construed subject to the limits of the legislative power of the State and so as not to exceed that power - - -

GUMMOW J: That does not help us.

MR GRAY: - - -

to the intent that where any enactment thereof, but for this section, would have been construed as being in excess of that power, it shall nevertheless be valid to the extent to which it is not in excess of that power.

GUMMOW J: That is an old "feel good" reading down section. It does not actually tell you what words you read in.

MR GRAY: No.

GLEESON CJ: Is all the barley with which your client is concerned grown in Tasmania?

MR GRAY: No.

GLEESON CJ: Is any of it grown in Western Australia?

MR GRAY: Yes. My client's rights relate to not only barley it grows but barley that it can - barley is being exported.

GUMMOW J: It presumably has sub-licensees.

MR GRAY: Yes, my client has the right to sub-license under the licence agreement.

GUMMOW J: And they would be the Pool, would they?

MR GRAY: Yes. One can see all sorts of commercial difficulties with that. If the Court pleases, to answer your Honour the Chief Justice directly, we say that in regard to barley being exported from Western Australia, my client has exclusive rights and that - - -

GLEESON CJ: Does that mean that the bone of contention is that your client would like to commence growing or to license people to grow Franklin barley in Western Australia?

MR GRAY: It would wish to do that but it would also wish to pursue its rights in regard to barley exported from Western Australia. So, when it talks about "property of the Grain Pool" it wishes to arrange for barley to be grown and wishes to deal with that barley, it wishes - it has its own grain as the marketing agent. Equally, it wants to exercise its rights to exclude others from the activities identified in section 11.

GLEESON CJ: Then, it remains a mystery to me, I have to say, why we would set about giving declaratory relief in relation to legislation that has ceased to have operation.

MR GRAY: If the Court pleases, I understand the difficulties the Court has raised and I would like to think that through over night if I could advance that, but we would say that we do have a sufficient interest to seek a declaration in that our interest is real, not theoretical.

GUMMOW J: Which declaration, though? There are two sought.

MR GRAY: The declaration in regard to the repealed Act. In regard to the current Act we have a current, present, alive and continuing interest. That Act seeks to give to the Grain Pool a monopoly in regard to exporting, on its face, and that is the very matter that we say we have exclusive rights in respect to.

McHUGH J: It says it is the sole marketing authority.

MR GRAY: Yes.

McHUGH J: Your argument about public access does not get anywhere in relation to exports from the Commonwealth, does it?

MR GRAY: No.

McHUGH J: So, you have to rely on section 11(1)(e).

MR GRAY: Yes, and on the face of it, that section provides to my client the sole rights in regard to export, exclusive rights, and the Grain Pool is saying it has the sole rights.

McHUGH J: No, it does not say that at all, does it? It says it is the marketing authority.

MR GRAY: The sole marketing authority in respect of prescribed grain that is to be exported. When one looks at the structure of the Act, sole marketing is the only person to be involved in that. We would say it is not allowed to export Franklin barley without - - -

GAUDRON J: Maybe they are both there with piles of barley that neither of you can export.

MR GRAY: There are substantial quantities of barley exported.

GAUDRON J: There is no problem about export from the Commonwealth. You have no trouble, have you, selling it within the rest of Australia?

MR GRAY: No.

GAUDRON J: Do you have any trouble selling it within Western Australia?

MR GRAY: Yes.

HAYNE J: Why? All the Grain Marketing Act bites on is export - intended product. You can sell domestically in Western Australia, can you not?

KIRBY J: I think Western Australia asserts otherwise.

MR GRAY: Yes, and in particular, we are not allowed to sell for export. So, we have rights regarding export in two ways: first of all would be selling for export ourselves, exporting it ourselves; and the other is in regard to other people not exporting any grain within the purview of the Breeder's Act without our consent.

GLEESON CJ: Do you understand Western Australia to assert that you cannot produce barley in Tasmania and sell it to somebody in Sydney for export from New South Wales to California?

MR GRAY: No, I do not understand them to assert that. I understand them to assert that we have no rights in regard to exporting in Western Australia.

GAUDRON J: That is to exporting from Western Australia barley grown in Western Australia. No, but it must be to export out of Western Australia overseas of barley grown in Western Australia.

MR GRAY: I just hesitate at "grown". Certainly, barley that has found its way to Western Australia by being grown or delivered there but one would think that, in all probability, is going to be just barley grown there but otherwise, Western Australia has not raised with us, for example, any suggestion that its legislation deals in other parts of the Commonwealth.

GAUDRON J: You could, presumably, sell it to somebody in New South Wales who could export it from New South Wales or is there comparable legislation throughout the Commonwealth?

MR GRAY: No, I understand not. I understand this is unique to Western Australia so if the Court pleases, this issue, at the practical level, arises from my client wishing to exercise its exclusive rights in regard to producing and selling and exporting and selling for export in regard to Western Australia. Now, we accept that the amendment of 1997 has reduced some of the problems we suffered from the earlier legislation but it leaves still, we would say, conflict and an impairment of our rights.

GLEESON CJ: At least the position seems clear to this extent, we know we do not have to worry about ape seed.

MR GRAY: That much is clear.

GLEESON CJ: We will resume at 9.30 am tomorrow morning and, in the meantime, there might be something to be gained from you and Mr Meadows seeing whether there can be some clarification of the issue.

MR GRAY: Yes, your Honour.

GLEESON CJ: We will adjourn until 9.30 am tomorrow morning.

AT 4.21 PM THE MATTER WAS ADJOURNED

UNTIL THURSDAY, 7 OCTOBER 1999