Xenophon v State of South Australia & Ors A4/2001 [2001] HCATrans 384 (16 August 2001)

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry

Adelaide No A4 of 2001

B e t w e e n -

NICHOLAS XENOPHON

Applicant

and

THE STATE OF SOUTH AUSTRALIA

First Respondent

ROBERT IVAN LUCAS

Second Respondent

KENNETH TREVOR GRIFFIN

Third Respondent

Application for special leave to appeal

GLEESON CJ

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT ADELAIDE ON THURSDAY, 16 AUGUST 2001 AT 2.30 PM

Copyright in the High Court of Australia

MR C.J. KOURAKIS, QC: If the Court pleases, I appear with my learned friend, MR A.L. TOKLEY, for the applicant. (instructed by Xenophon & Co)

MR B.M. SELWAY, QC, Solicitor-General for the State of South Australia: If the Court pleases, I appear with my learned friend, MR M.D. WALTER, the Crown Solicitor, for the first and third respondents. (instructed by Crown Solicitor for South Australia)

MR N.L. STRAWBRIDGE: Your Honour, I appear for the second respondent with MR A.D. SHORT. (instructed by Minter Ellison Lawyers)

GLEESON CJ: Yes, Mr Kourakis.

MR KOURAKIS: If the Court pleases, the application raises four issues. They are the question of the standing of the applicant to bring the proceedings; the question of the justiciability of the grant of an indemnity; whether there are limits, and this is the third question, on the executives or the Attorney's power to give the indemnity of an indemnity of the type given; those limits arising either from guidelines from the Crown Proceedings Act or a limitation inherent in the Executive power to give such indemnities or to contract generally; and then, fourthly, the question which is raised is whether any of those limits were exceeded and, if so, whether it is for the Executive to determine whether a particular indemnity fell within them all for the courts to review it.

GLEESON CJ: Now, Mr Kourakis, there are some interesting questions floating around in the case, as it were, but you have to meet the argument that appears on page 73, line 25, which is that if we granted special leave to appeal, we would never get to any of those issues because your case would fail on the merits.

MR KOURAKIS: If the Court pleases, and that issue is the last of the issues that I have mentioned, whether there was, in fact, a breach. It depends on an assessment of whether the indemnity given in this case was, in fact, an indemnity with respect to a wrong permitted by the Minister arising out of the performance of his duties. That is, Minister Lucas's duties.

GLEESON CJ: Well, now, contrary to the procedure that lawyers often like to adopt, why do we not go straight to the merits?

MR KOURAKIS: If the Court pleases, that question then falls to be decided by considering the material itself in which the defamatory statement was made. That is at page 6 of the application book.

GLEESON CJ: Was this a press statement, a press release?

MR KOURAKIS: No, it was a leaflet or a pamphlet distributed to a parliamentary electorate of the parliamentary colleague of the Minister, party parliamentary colleague, and it was simply distributed to members of that electorate.

GLEESON CJ: What, in a letter box or something?

MR KOURAKIS: Yes, and that information is only before your Honours as a result of the statement of facts at page 50 at paragraph 2. It is not a statement of fact that has been contested. Your Honours, the relevant defamatory statements are those appearing in the very first paragraph and the very last paragraph on that page.

GLEESON CJ: But in terms of the entitlement to an indemnity, is it right to say, as is suggested in the argument put against you on page 73, that the question is whether the second respondent was acting in the course of his official duties in doing this?

MR KOURAKIS: In my submission, that is the question and, indeed, on that issue, that is the question rather than whether it was open to the Attorney to so decide. In my submission, on review, it was open to the court to decide whether, in fact, he was acting in the execution of his duty and if he was not, then orders that we sought, either by way of a judicial review or declaration, were available to us.

GLEESON CJ: Why is it not part of the duties of a treasurer to argue the political case for his government?

MR KOURAKIS: Your Honour, in certain circumstances it may be, but in this particular case the primary consideration is the nature of the leaflet itself. That is, why it was generated, to whom it was distributed, and the purpose that it was serving. Secondly, the very tone of it, as it were, and, in particular, the opening statements which are easily recognised as party political arguments and attacks, with respect to - - -

GLEESON CJ: But our democracy exists on the basis of party political argument.

MR KOURAKIS: And, if your Honour pleases, it is no part of the applicant's case that that is not open or that there is any reason to restrict such attacks made by persons who are simply parliamentarians or even leaders of the governing party in Parliament. But the question is whether it is part of the Minister's duty, and that is how the guidelines speak of the situation, part of the Minister's duty to produce a pamphlet such as that for distribution in what, in our submission, is simply a parliamentary political or party political process.

GLEESON CJ: But why is it not part of the duty of a Minister to argue his case, or his government's side of the case, on a controversial political issue as vigorously as circumstances, in his judgment, require?

MR KOURAKIS: Your Honour, in our submission, there is a distinction between what that Minister can do as the leader of a governing party and what is, indeed, part of his function as a Minister. In that sense, no one could take issue with the proposition that the leader of the governing party in the Parliament would argue as vigorously as he could for a particular piece of legislative change. But, in our submission, there is a difference, that is, that there is at least a separation of functions, although clearly not of identities, in this respect.

McHUGH J: But why is it not part of his functions to persuade his fellow members of Parliament and, indeed, the broader community that it is in the interest of the State to sell the State's electricity assets?

MR KOURAKIS: If your Honour pleases, it is certainly part of the Minister's responsibility in reporting to Parliament, and Ministers are obviously accountable to Parliament, to argue for legislative change that would assist government administration but, in my submission, although clearly there are circumstances in which that can be extended to advocating a particular course publicly, in the end it is a question of fact and degree, characterisation, the way in which I put it, which has to be applied to this particular pamphlet. Ultimately, to obtain the orders we seek, we would have to persuade this Court that that particular pamphlet is, when one comes to draw the line, on the side of being a party political pamphlet.

GLEESON CJ: What is the line between? Between what and what?

MR KOURAKIS: Between the Minister's duties in administering a government department and what the same person does as the leader of the governing party in Parliament, or a leader of the governing party in Parliament. If the Court pleases, the very fact that those opening paragraphs do and make, what, in my submission, is political attack on a particular parliamentarian - - -

GLEESON CJ: What is wrong with a political attack?

MR KOURAKIS: As made between parliamentarians and politicians, clearly nothing. That is their daily work. The submission I make - - -

McHUGH J: Just to move off the subject slightly. In Lange's Case, we held that you do not lose the constitutional right of freedom of communication on political matters even if you intend to injure your political opponent.

MR KOURAKIS: The constitutional protection to the right of free speech, though, is obviously, with respect, one that applies to parliamentarians and Ministers. In terms of drawing the distinction between an Executive act and Ministerial act and the actions of parliamentarians though, that is defining the limits, if you like, of Executive power. In my submission, a more careful delineation is required. If the Court pleases, as to that question, there are no further submissions that I have to make but I can move to the questions of standing and justiciability.

If the Court pleases, on the question of standing, Justice Bleby below held that there was no standing on the part of Mr Xenophon. The applicant contends that he had standing at least on three grounds. Firstly, as to the payment, in answer to the claim that he made for what was the first defamation arising from the leaflet I have just taken your Honours to, Mr Xenophon had standing as the person who had received moneys out of consolidated revenue and, for that reason, in our submission, had standing to seek orders declaring in the end whether that payment was made validly or not because, of course, that might affect his position should any action be taken to recover that money in the future. Or simply so that he could know whether the money that had been paid to him out of the consolidated revenue had been paid validly, and for that reason, had standing.

Secondly, in our submission, he had standing simply as a member of the Parliament that had made appropriations and funds available to satisfy indemnities. As to the second indemnity, which was one given to Mr Lucas, both as to his legal costs in contesting the defamation proceedings that, as yet, are not resolved and, indeed, are still continuing, Mr Xenophon had standing because he was placed in a position of a forensic contest with Mr Lucas, who had the benefit of that indemnity, contesting the legal proceedings and deciding to take such forensic procedures in defence of them with the benefit of the indemnity and the public purse.

So, being a litigant opposing Mr Lucas, who had the benefit of a government indemnity, that gave the applicant standing for those reasons. If the Court pleases, as to the question of tracing the standing arising from Mr Xenophon's position as receiver of the money and arising from his position simply as a member of the Parliament, his Honour Justice Bleby decided that placed him in no different position to any other member of the public and, in our submission, with respect, the learned judge was in error. As to the question of Mr Xenophon's standing by reason of being in contest with Mr Lucas, who had the benefit of the government provided indemnity, his Honour Justice Bleby erroneously found that Mr Xenophon's application did not seek to challenge that part of the indemnity. His Honour Justice Bleby so found at page 40.

That is plainly not so, if the Court pleases, because by paragraph 1 of the application and by paragraph 3, orders were sought quashing the indemnities. Those indemnities appear at page 7 and 10 of the application book and it is clear that they extend to the provision of assistance to Mr Lucas for the payment of his own costs. If the Court pleases, turning to the question of justiciability, both his Honour Justice Prior and his Honour Justice Bleby considered the test established by Lord Diplock in the CCSU Case, and your Honours can see that that was set out by his Honour Justice Prior at page 21 of the application book.

Your Honours will see, from paragraph 11, that his Honour Justice Prior understood that passage, which is there set out, to mean that the only person who could challenge the administrative decision was a person directly affected by the rights created by the administrative decision and he reasoned that because the grant of the indemnity, in fact, only had a direct legal effect on Mr Lucas, that it was not justiciable at the suit of Mr Xenophon. His Honour Justice Bleby came to a similar conclusion which can be seen at page 35.

If the Court pleases, the confusion which, in our submission, and the error which, in our submission, arises from that analysis, is best considered in the light of his Honour Justice Wilcox's analysis of Lord Diplock's statement which appears in our materials under tab 6. In the Peko-Wallsend Case 75 ALR 218 at page 249, his Honour Justice Wilcox explained that the importance of the passage was simply to show that unless some particular rights were affected directly by the decision, it was not reviewable.

But his Honour Justice Wilcox, in the Peko-Wallsend Case went on to explain that it was enough, though, that the person - it was not necessary for the person to be a beneficiary of the particular order but simply be affected by it. In our respectful submission, what their Honours have done is to confuse the question of justiciability with standing.

McHUGH J: Not necessarily. The way they approached it might give rise to the submission just put. But one of the problems of justiciability is the question of what criteria is there against which the grant of the indemnity can be judged. I mean, your submissions must rely heavily, if not exclusively, on the approval by Cabinet of the Crown Solicitors, or the representation, as being binding in some way.

MR KOURAKIS: On the guidelines?

McHUGH J: On the guidelines.

MR KOURAKIS: Yes, if the Court pleases. That is an important part of the argument that we put and, if the Court pleases, it is the case that the Court below decided justiciability on both grounds, what, in our submission, firstly, is the mistaken understanding of what flows from Lord Diplock. But also, secondly, on the basis that in the end it was simply a matter of policy and that is the grant of an indemnity. It was simply a matter of - - -

McHUGH J: But have the guidelines any legal force and effect? They have never been approved by the Executive Council, have they?

MR KOURAKIS: No, only by Cabinet.

McHUGH J: Is Cabinet a body mentioned in the South Australian Constitution?

MR KOURAKIS: No. If the Court pleases, what they represent though, is a decision which affects the way in which the Executive, in effect, has allocated tasks amongst its members and it shows, as a matter of the practice which it has adopted, what part of its Executive functions it has decided to give to the Attorney-General. The guidelines, which your Honours can see in the application book, make it clear that, in so far as - - -

GLEESON CJ: What page is that?

MR KOURAKIS: At page 8. It is the guideline in the paragraph (iii) which is of direct concern. The first two paragraphs deal with the assistance to a Minister who is to be a plaintiff; paragraph (iii) with a Minister who is a defendant or proposed defendant. But reading down to the last sentence in that paragraph, the delegation, if you like, of authority to the Attorney-General to give an indemnity is limited, so that:

Such assistance will not be provided where the publication complained of did not reasonably arise from the performance of Ministerial duties.

In our submission, that is a positive restriction on the power of the Attorney-General.

GLEESON CJ: Is that not one of the duties of a Minister, to go into bat for the government on a political issue?

MR KOURAKIS: If your Honour pleases, that question simply takes me back to the submissions I made at the outset, and that is to say that that is so if one means, by Minister, the person who is, in fact, the leader of the governing party and in that capacity, that is one of that persons recognised functions.

GLEESON CJ: Is the ultimate issue, on the merits, the question whether it was an improper exercise of power to grant this indemnity?

MR KOURAKIS: Yes. That is an ultimate issue. Another issue is whether it was within the specifically and more limited grant of power to the Attorney-General for the Attorney-General - - -

GLEESON CJ: Well, that is a sort of subsidiary issue.

MR KOURAKIS: If the Court pleases, yes. If the Court pleases, they are my submissions.

GLEESON CJ: Thank you, Mr Kourakis. We do not need to hear you, Mr Solicitor.

Quite apart from questions of standing and justiciability, in order for the applicant to succeed on an appeal in this matter, it would be necessary to persuade this Court that the grant of an indemnity was not a proper exercise of power. Justice Prior, with whom Justice Lander agreed, resolved that issue in favour of the respondents. On that issue there are insufficient prospects of success to warrant a grant of special leave to appeal in the matter and the application is refused with costs.

AT 2.50 PM THE MATTER WAS CONCLUDED