Citta Hobart Pty Ltd & Anor v Cawthorn [2021] HCATrans 126 (13 August 2021)

Last Updated: 16 August 2021

[2021] HCATrans 126

IN THE HIGH COURT OF AUSTRALIA

Office of the Registry
Hobart No H1 of 2021

B e t w e e n -

CITTA HOBART PTY LTD

First Applicant

PARLIAMENT SQUARE HOBART LANDOWNER PTY LTD

Second Applicant

and

DAVID CAWTHORN

Respondent

Application for special leave to appeal

GAGELER J
GORDON J

TRANSCRIPT OF PROCEEDINGS

AT SYDNEY AND MELBOURNE BY VIDEO CONNECTION

ON FRIDAY, 13 AUGUST 2021, AT 9.29 AM

Copyright in the High Court of Australia
GAGELER J: The practice will be that the presiding Judge will announce the appearances.

MR D.J. BATT, QC appears with MS J.D. WATSON for the applicants. (instructed by Page Seager Lawyers)

MR R. MERKEL, QC appears with MR S.A. BECKETT and MS L.E. HILLY for the respondent. (instructed by Hobart Community Legal Service)

MR M.E. O’FARRELL, SC, Solicitor‑General for the State of Tasmania, appears with MR D.R. OSZ, for the Attorney‑General for the State of Tasmania, intervening. (instructed by Solicitor‑General for the State of Tasmania)

GAGELER J: We would be assisted, Mr Merkel, by hearing from you initially. Mr Merkel, I should indicate, as is apparent from calling on you first, that we might have to think that the question is an important one and that the argument sought to be presented by the applicant is at least reasonably arguable.

MR MERKEL: Your Honours, I would hope to dissuade your Honours against that view in the circumstances of this case, and can I go to the heart of our submissions. The grounds of appeal and the two special leave questions are premised on the positive answer having to be given to one question and that question is, is the applicants’ claim that compliance with the 2010 Commonwealth Disability Standard, being its defence in reliance on section 34 of the Commonwealth Discrimination Act, a defence available to the applicants in respect of the respondent’s claim of unlawful discrimination under the Tasmanian Act.

Critically, we say, the only pathway to a positive answer to that question is that by not providing that defence, the Tasmanian Act is inconsistent with section 34 of the Commonwealth Act and, to that extent, the Commonwealth Act is invalid under section 109. We see that as the question common to both special leave grounds.

But, can I say, for the reasons summarised by each of the members of the Full Court, the asserted defence is not a defence available to the applicant in respect of the respondent’s claim under the Discrimination Act. Rather, it is a defence only on the proper construction of the Commonwealth Act to a claim of unlawful discrimination under that Act. Accordingly, the applicants’ reliance on that defence was found correctly by the Chief Justice and Justice Wood, but also necessarily by Justice Estcourt, to be misconceived.

Can I just emphasise the importance of the word “misconceived”? We say we can accept why your Honours would consider the Burgundy Royale test as a matter of importance that your Honours in the High Court have not considered. But a precondition to that issue arising must be that there is a question arising under the Constitution in the matter. If the defence that is sought to be put forward is misconceived, we say it means that it is not available as a matter of law. If it is not available as a matter of law we say you do not get to section 109.

Can I, just by comparison with the situation that if this arose in Burns v Corbett, the pleading that the matter is between residents of two States of itself does not make it a matter arising under the Constitution. Before it becomes a matter arising under the Constitution and would attract an issue such as Burgundy Royale it must be shown that the persons are residents of two States. If one is a resident of another country or of Canberra the constitutional question would not arise. We say likewise here the situation is that ‑ ‑ ‑

GAGELER J: Mr Merkel, it is a different constitutional question there, is it not? It is a question of diversity jurisdiction in that case.

MR MERKEL: Yes, your Honour, but by way of ‑ ‑ ‑

GAGELER J: It is an underlying constitutional fact.

MR MERKEL: I appreciate that, your Honour, but by way of analogy, if the Commonwealth law on the proper construction of the Act is not available as a defence in proceedings in Tasmania, other than under the Commonwealth Act, there is simply no ground for inconsistency because the two legislative regimes provide different pathways for a discrimination claim.

Can I go to the heart of why I say that is correct because I need to take your Honours to the Discrimination Act and the Human Rights Commission Act? Can I come straight to it to look at the scheme, because the scheme of the Human Rights Commission Act can be described very briefly, and this is why we say the inconsistency alleged is misconceived because it does not arise.

GORDON J: Mr Merkel, may I ask a question? Is not the problem with your proposition that you seek to expand the idea of colourability to extend to merits review?

MR MERKEL: No, your Honour. We say that the critical question is has a defence arisen – has a defence given rise to a matter arising under the Constitution and we say ‑ ‑ ‑

GORDON J: The only basis upon which someone would not recognise that as a matter is if it was colourable when here there is no dispute that this defence was not colourable.

MR MERKEL: We accept that, your Honour, but we say before you can get to it as a defence it must be shown that the Commonwealth law provides a defence outside the Commonwealth Act. We say the Commonwealth Act properly understood has a regime which is much like what the Court considered in Re East; Ex parte Nguyen – it is not on our list of authorities, but we cite it in our submissions. There, the High Court considered the Racial Discrimination Act pre‑Brandy and the question is could you bring the proceeding outside that Act. Six of the Judges of the Court, Justice Kirby was the seventh, agreed – indicated that in that – this is at paragraph 26:

The elaborate and special scheme of Pt III of the Act was plainly intended by the Parliament to provide the means by which a person aggrieved by a contravention of s 9 of the Act might obtain a remedy –

and critically, at paragraph 32, the Court decided that you could not bring a proceeding outside that Act because the Act provides its own:

exclusive regime for remedying contraventions. The only right that the Act creates is a right to engage the processes prescribed by it and the duties or liabilities that are created are correlative to that right.

What I was hoping to do with your Honours was to show why that is precisely what the Commonwealth Act does. It does not purport to give a defence outside a complaint made under the Commonwealth Act then referred to the Human Rights Commission for inquiry and then lead into a Federal Court proceeding. If that is the case there is simply no scope for the argument there is inconsistency.

What I was hoping to do, your Honours, if I could go to the scheme of the Act because it comes up under Part 2, starting with section 22 of the Commonwealth Act, the scheme is a particular form of disability discrimination in each section which is said to be unlawful. Then one gets to the standard and we find the same scheme. So, one gets to section 32:

It is unlawful for a person to contravene a disability standard.

The unlawfulness arises in respect of particular forms of discrimination. Could I then go to section 34, which is the critical section:

If a person acts in accordance with a disability standard this Part . . . does not apply –

Therefore, it is not unlawful under this part, that is Part 2. Could I then go next to section 41, which shows that this Act does not intend to create any rights except in respect of offences. Section 41 says:

Except as expressly provided by this Division, nothing in this Act makes it an offence to do an act that is unlawful –

That is supplemented by section 125 which says – and this is a critical section we say:

This Act does not confer on a person a right of action in respect of the doing of an act that is unlawful under a provision of Part 2 unless a provision of this Act expressly provides otherwise.

So, when we go to the statute itself, this merely is a scheme for prescribing unlawful conduct. Then we go to section 13(3). The operation of 13(3), your Honours, is that there is intended to be concurrent jurisdiction with the exception of a disability standard which can provide, when it comes to that section, that Commonwealth law is exclusive, or State law is not to be affected. Then we get to (4) which assumes concurrent jurisdiction because you have a complaint able to be made in one jurisdiction or the other, but not both. Then one goes to section 31(2)(b), which is the provision that enables a disability standard to show it:

is not intended to affect the operation of a law of a State –

Could I next go to the standard, which is at application book page 123 ‑ ‑ ‑

GAGELER J: Mr Merkel, is all of this founded on the proposition that a matter arises under the Constitution only if the constitutional argument is a good one?

MR MERKEL: No, your Honour. We say that a precondition to the constitutional argument being a good one or not is whether there is an inconsistent Act, in other words an Act that applies in Tasmania that denies – is inconsistent with the limited defence given under the Tasmanian Act. If they, for example, quoted the Road Traffic Act or some building plan act and said compliance with that Commonwealth Act gave us a defence, the Court would have to consider does that Act apply in respect of the proceeding to offer a defence which is not given under the Tasmanian Act.

GORDON J: But is that not, Mr Merkel, as I put to you earlier, extending colourability to merits – include merits. Sometimes it is described as fabricating jurisdiction, being the label that is attached to certain conduct. Here, there is no suggestion of it. What you are asking us to do is to look to the merits of the matter and to extend the circumstances in which a tribunal itself might determine a matter, whether it is within jurisdiction or not. The only carve‑out up until now has been colourability.

MR MERKEL: Your Honour, may I say this? When you look at Burgundy Royale, colourability is one example. Another is points not arguable and we would say if it is misconceived and the inconsistency does not arise, the mere assertion of it does not create a matter arising under the Constitution. That is to be contrasted with where a claim in defence is made under a federal Act, that unless it is misconceived, but if it were misconceived such as it had no merit because it did not give rise to a defence at all, then you would not have a matter arising under the Constitution.

We say the concept of whether this defence so‑called under section 34, meaning compliance with the standard is a defence to the Tasmanian Act, must be based upon the Commonwealth Act having an application in Tasmania other than in proceedings under the Commonwealth Human Rights Commission Act.

What I wanted to say is critical to our argument, if you go to page 123 of the application book, your Honours will see the object of the standard is stated - in the last two lines:

the provision of that access –

which is in accordance with the standard:

covered by these Standards, will not be unlawful under the Act.

So that the standards themselves contain the very indication that they are to operate consistently with Part 2 to show that what conduct would otherwise be unlawful under that Act, if compliant with the standards, is not unlawful of the Act.

But that only means lawful or unlawful takes you directly to the Human Rights Commission Act, and the Human Rights Commission Act has the procedures that we have indicated. It starts with a complaint under section 46P, then a termination of the complaint by the President under 46PH and then you can go under 46P, 46PH and then 46PO gives you a right to an application to the court.

So that what we have is a Commonwealth scheme concurrent with the State scheme which only applies in respect of a discrimination claim made under the Commonwealth Act and we say when you look at the standard, when you look at section 31 and you look at section 32, the Commonwealth Act scheme is self‑contained for a complaint for discrimination under the Commonwealth Act.

We say that the question arising under the Constitution does not arise until there is an act that is inconsistent. We say there is no inconsistency because there are two pathways. That is the first argument, but we also say that there has been a distinct line of authority which is not, and which has never applied Burgundy Royale, which is the line stemming from Justice Brennan’s decision in Re Adams.

What his Honour said in respect of the administrative tribunal in Re Adams is that the Tribunal is under a duty to form an opinion once a constitutional question has arisen as to that question and as to whether it could give rise to invalidity. Prima facie, his Honour’s approach was that acts are to be treated as valid and, prima facie, to be acted upon. But if an opinion is formed that it is not valid, that opinion is not an exercise of adjudicatory authority because a tribunal of anything other than a Chapter III court has no jurisdiction in the matter.

So, his Honour has said, and this has been followed time and again in New South Wales, but also been recognised in the Federal Court in Qantas v Lustig by Justice Perry, whenever you have a constitutional question going to validity the Tribunal is under a duty to form an opinion about validity and act upon it, but in doing so it is not exercising adjudicative authority because it cannot be conferred with jurisdiction to determine that question.

His Honour outlines in great detail in Re Adams why that was a duty of the Tribunal. It must act upon its opinion and the proper course is for the Tribunal to mould its procedures to meet that exigency, such as if a person in the position of the applicant wished to claim invalidity, the proper course is not to have just merely raised a defence and said to the Tribunal, “There is no jurisdiction”, but to have actually gone to the court for declaratory relief and prohibition which they did not do.

GORDON J: Mr Merkel, that raises two very important issues here. One is that this Act, that is the relevant Act for this Tribunal, did not have the provisions that sometimes exist in other Acts, including the Commonwealth AAT for referrals of questions of law. So, put aside that statutory element which is lacking, there was nothing stopping you seeking a declaration in the Supreme ‑ ‑ ‑

MR MERKEL: Your Honour, there was nothing stopping either side seeking a declaration, but, prima facie, the Tribunal was required to act on the basis that the matter that has arisen before it under a State law has arisen under a valid law. But the vice of my learned friend’s argument is simply that there is no matter. Once the federal constitutional issue has been raised, on the approach they are putting, jurisdiction is lost. There is nothing to refer and in the New South Wales Court of Appeal cases their Honours had taken that point in saying that you could not refer a question of law arising in the matter if it is a constitutional issue because the constitutional issue does not arise in the matter because there is no jurisdiction to deal with it.

Can I say this. Justice Brennan’s approach, which was applied in Gaynor,....., Sunol and also recognised in Qantas v Lustig as distinguishable from the line of cases of Burgundy Royale, has never been questioned.

GAGELER J: Mr Merkel, would I be correct in understanding that neither Burgundy Royale nor Re Adams have been explored in judgments of this Court?

MR MERKEL: I think that is a fair conclusion. I could not be comprehensive but there certainly would be nothing authoritative on it. We say that both questions come back to only arise if the first question that we have put is answered affirmatively because a precondition of both questions arising, your Honour, is that the defence might misconceive. We would say a misconceived defence would plainly not give rise to a constitutional question any more than any other defence.

Can I finish on making three points, your Honours? We would wish to say that the submission that what we are putting is unworkable and incoherent is, we say, quite the contrary. If one looks at the consequences of what we are contending, far from it being incoherent and unworkable.....coherent and workable, namely that the opinion is to be formed or the Act must give rise to a real question, not one that does not arise.

But look at what the outcome is, we say, in the present case. The Tasmanian Tribunal has dismissed the claim on the ground it has no jurisdiction even though it may transpire, as it has, that the ADA Act is relevantly invalid. That is the first thing. That is anomalous in the extreme. The second is that by reason of section 13(4) of the DDA, the applicant, or the respondent now, would be precluded from bringing a proceeding in a Commonwealth Tribunal, and the third is that a litigant in the position of the applicant can achieve those outcomes by merely asserting the constitutional claim rather than doing what was suggested as appropriate in Sunol and other cases of going to seek declaratory relief because that relief would decide whether there is a matter or is not a matter.

We would say those outcomes bespeak error on the basis of the approach that is being advocated by our opponents. They are the submissions that we would say why neither question sought to be raised actually does arise on the proper construction of the Discrimination Act in the Commonwealth sphere and the State sphere.

If your Honours are disposed to grant special leave, we have made an application for special costs orders. We appreciate that the Court has made those in the CSR Case. We would understand that it may be that your Honours would prefer - or allow us to have that question referred over to the Full Court if your Honours grant leave so it can be considered, as it was, as an application made to the Full Court in the context of the actual hearing, rather than as a precondition.

We say, for the reasons we have set out in our submissions, those special costs orders.....be made by your Honours as a condition of granting special leave or, alternatively, if your Honours were not disposed to do so at this stage, then the question of whether such orders should be made should be referred to the Full Court if your Honours are to grant special leave. They are the submissions that we would put to your Honours against ‑ ‑ ‑

GAGELER J: Mr Merkel, can I ask you about costs in the Tribunal? Your client started the proceedings in the Tribunal. Was he at risk as to costs there?

MR MERKEL: Can I just check for a moment, your Honour? I thought the Tribunal may not be a costs jurisdiction.

GAGELER J: In the Full Court I note that there was no order as to costs. Was there any discussion about costs before the Full Court?

MR MERKEL: Sorry, your Honour, the Full Court left it open to the parties and orders were subsequently made that costs be paid by the applicants to the respondent. So, the current order is there is no order for costs in the Tribunal.....but the applicants were awarded costs in.....special leave as well as these circumstances giving rise to special leave are very much within the.....CSR because they are.....your Honours have indicated at the outset raise an important issue which is really not related to this question at all but relates to tribunals throughout Australia and, therefore, is not a cost that should be borne by the respondent. So, we would say that.....for the special orders to be made of the kind that we have made.

I understand that the applicant is a commercial entity, not recurrent.....as with Tasmania, but we would say the Tasmanian Attorney’s intervention and the basis on which your Honours might grant special leave, if that is what your Honours are proposing to do, would take us fairly and squarely within the kind of principles this Court enunciated in the CSR Case. So, we would say this is a case where special leave should only be granted on the basis of the special orders that we seek.

I should say that costs were agreed to be paid by the applicants to the respondent, and that is where the situation remains. They are the submissions we would put against a grant of special leave or.....special order for costs if the Court is disposed to grant.....

GAGELER J: Mr O’Farrell, we do not need to hear from you. Mr Batt, we are minded to grant special leave on the condition that the applicants not seek costs in this Court and not seek to disturb the position as to costs in the Full Court of the Supreme Court. Do you have anything to say against the imposition of that condition?

MR BATT: Your Honour, whilst we would maintain the reliance on the submissions we made in that regard at application book page 137, if that is the concluded view of the Court then we would wish to proceed with a grant of special leave on that condition.

GAGELER J: Very well.....in the Full Court of the Supreme Court. There will be a grant of special leave to appeal in this matter. Now, it is at least.....

MR MERKEL: Sorry, your Honour, can your Honours hear me? I think we were cut off at the time your Honour Justice Gageler was mentioning what the Court was proposing to do.

GAGELER J: Yes. Mr Merkel, we can hear you, we cannot see you. We cannot see Mr Batt and we cannot see Mr O’Farrell. We can now see you, Mr Merkel, but not other counsel.

MR MERKEL: Thank you, your Honour.

MR BATT: Your Honours, it is Mr Batt speaking. I do apologise – we can hear and see you and we were taken out of the link at the point when your Honour had just commenced to pronounce the orders the Court was minded to make.

GAGELER J: Yes. I will pronounce the order again. On the condition that the applicant not seek costs in this Court and not seek to disturb the position as to costs in the Full Court of the Supreme Court, there will be a grant of special leave to appeal. I was then moving on to ask how long counsel considered would be needed for the hearing of the appeal and I asked Mr O’Farrell about the interest level of other Attorneys‑General.

MR O’FARRELL: Your Honour, I think there will be some interest. .....a discussion between the Solicitors -General. I cannot really inform your Honour much further than that, but I expect that there will be a number of interveners.

GAGELER J: Thank you. I thank counsel for their assistance.

MR BATT: Your Honour, I do apologise. There is one formality, if your Honours consider it ought be attended to. The special leave application was filed one day outside the time permitted by rule 41.02.1 and, in accordance with rule 41.02.2, we seek an order dispensing with compliance with that time limit.

GAGELER J: Yes, the dispensation was implicit in the grant of special leave, Mr Batt.

MR BATT: If your Honour pleases.

GAGELER J: Thank you. The Court will now adjourn to 10.30 am.

AT 9.58 AM THE MATTER WAS CONCLUDED