This week in the High Court of Australia

Apologies to everyone…having been on holidays I missed the beginning of the High Court’s law term.  I will shortly post details of the cases heard last week.

This week there are three cases being argued in the High Court of Australia.

First cab off the rank, on Tuesday 11 February 2014, is the case of Australian Financial Services and Leasing Pty Ltd v Hills Industries Ltd, an appeal from the NSW Court of Appeal.  In this case a rogue and his companies were heavily indebted to Hills Industries and another company, Bosch Security.  The rogue generated fake invoices for the purchase of non-existent equipment from Hills and Bosch.  Using these invoices he raised funds from AFSL.  AFSL thought it was purchasing goods from Hills and Bosch and leasing them back to the rogue.  The funds were paid by AFSL to Hills and Bosch by electronic transfer.  The rogue told Hills and Bosch the moneys were partial repayment of the debts he owed to them.  As a result of that partial repayment, Hills desisted from taking proceedings against the rogue’s companies to recover the debts, and Bosch agreed to setting aside various default judgments and abandoning other proceedings that were currently on foot. Ultimately, the fraud was discovered, and AFSL commenced proceedings seeking the restitution of the funds paid to them.  At first instance Einstein J ordered Hills to pay restitution to AFSL, but dismissed AFSL’s claim as against Bosch.  Einstein J found that Hills had given no consideration for the moneys it had received from AFSL.  Nor had Hills suffered detriment arising out of a (speculative) change of its position after receiving those moneys. Einstein J upheld Bosch’s defence of “change of position”, as Bosch had incurred a detriment by extinguishing its legal claims against AFSL.  The Court of Appeal unanimously dismissed an appeal by AFSL and allowed an appeal by Hills.  Their Honours held that the “change of position” defence was made out by both Bosch and Hills.  This was because, by discharging the debts owed to them by TCP, they had each given up an opportunity to enforce payment of those debts by TCP.  The Court of Appeal found that in such circumstances it would be unjust for either Bosch or Hills to be required to pay restitution to AFSL.  At issue in the High Court is whether or not Hills and Bosch were required to demonstrate actual expenditure or financial commitment or loss in order to make out the defence of change of position in a claim for payment by mistake.  Also at issue is whether in any event Hills and Bosch had a defence to the claim for restitution because the receipt and application of funds by Hills and Bosch was a bond fide discharge of the indebtedness of the rogue’s companies.

On Wednesday, 12 February 2014 the Court will hear argument in State of Western Australia v Brown.  This case arises out of a joint venture established in 1960 to develop the iron ore deposits at Mount Goldsworthy in the Pilbara region of Western Australia. The State of Western Australia and the joint venturers executed an agreement, the operative form of which was given effect to by the Iron Ore (Mount Goldsworthy) Agreement Act 1964 (WA).  In the context of proceedings for the determination of native title in relation to land in the Pilbara region, an order was made to determine as a separate question whether the Mount Goldsworthy mineral leases were subject to the native title rights and interests of the Ngarla People or whether the rights granted to the joint venturers extinguished those native title rights and interests. At first instance, Bennett J found that the Mount Goldsworthy mineral leases did not confer exclusive possession on the joint venturers so as to extinguish wholly the native title rights and interests of the Ngarla People, but found that the rights granted under those mineral leases and the underlying agreement were inconsistent with the native title rights and interests continuing to exist in the area where the mines, town sites and associated infrastructure were constructed, but not in the undeveloped areas.  As a consequence of this inconsistency, her Honour held that the Ngarla People’s native title rights and interests were wholly extinguished in the developed areas of the mineral leases.  Brown, on behalf of the Ngarla People, appealed.  The State of Western Australia and the joint venturers cross-appealed, arguing that the trial judge should have found that the Ngarla People’s native title rights and interests were wholly extinguished across the whole of the area which was subject to the mineral leases. The Full Court of the Federal Court of Australia allowed the appeal and dismissed the cross-appeal.  Greenwood J found that the native title rights of the Ngarla people were not extinguished by the grant, but that the exercise of the granted rights by the mining companies would prevent the exercise of each of the native title rights (over the whole land) for so long as the mining companies carried on the activities contemplated by the agreement.  The Full Court concluded that the Ngarla people were prevented from exercising their native title rights over the whole land while the joint adventurers continued to hold their rights as granted.

On Thursday, 13 February 2014 the Court will hear argument in Achurch v The Queen. Achurch was convicted of three offences relating to the supply of prohibited drugs.  He was sentenced to 14 years imprisonment with a non-parole period of 6 years.  The Crown appealed on the grounds that the sentencing judge had failed to sentence Achurch in accordance with the NSW Crimes (Sentencing Procedure) Act 1999 because the second and third offences attracted a standard non-parole period of 10 and 15 years respectively.  The NSW Court of Criminal Appeal upheld the appeal, sentencing Achurch to 18 years imprisonment with a non-parole period of 13 years. The High Court subsequently delivered judgment in Muldrock v The Queen [2011] HCA 39 in which it held that the Sentencing Act id not require the Court to commence by asking whether there were reasons for not imposing the standard non-parole period, but simply required the Court to the court to take into account the full range of factors in determining the appropriate sentence for the offence, while being mindful of two legislative guideposts: the maximum sentence and the standard non-parole period.  Achurch then applied for leave to have his appeal re-opened, arguing that the effect of Muldrock was that his original sentencing did not proceed according to law.  This application was rejected by an enlarged bench of the NSW Court of Criminal Appeal, which held that not only should the Crown appeal have been allowed, but that no lesser sentence was warranted.  In the High Court, Achurch challenges both the construction of the sentencing Act by the (second) Court of Criminal Appeal, and also the decision not to reopen the appeal on the grounds that the sentence could, in accordance with correct principle, have been lawfully imposed.

Political donations restrictions ruled to be unconstitutional

Today the High Court delivered judgment in Unions NSW v State of New South Wales [2013] HCA 58 in which the Court unanimously held that reforms to the Election Funding, Expenditure and Disclosures Act 1981 (NSW) introduced by the O’Farrell government are invalid because they impermissibly burden the implied freedom of communication on governmental and political matters, contrary to the Commonwealth Constitution.

Section 96D of the Act purported to prohibit the making of a political donation to a political party, elected member, group, candidate or third-party campaigner, unless the donor was an individual enrolled on the electoral roll for State, federal or local government elections.  The Act also purported to cap the total expenditure that political parties, candidates and third-party campaigners could incur for political advertising and related election material.  For the purposes of this cap, section 95G(6) of the Act aggregated the amount spent on electoral communication by a political party and by any “affiliated organization” of that party, ie a body or organization “that is authorized under the rules of that party to appoint delegates to the governing body of that party or to participate in pre-selection of candidates for that party (or both)”.

The High Court unanimously held that sections 96D and 95G(6) burdened the implied freedom of communication on governmental and political matters. Although the implied freedom of political communication arises by way of implication from the system of representative and responsible government provided for by the Commonwealth Constitution, nonetheless the freedom also applied to restrictions on political communication arising in the course of a State election. This was because there is an overlap in the discussion of political and governmental matters at a State and federal level and that it may be difficult to separate those kinds of issues.  The Court accepted that the Act had general anti-corruption purposes.  However, the Court was not satisfied that the impugned provisions were sufficiently directed towards those anti-corruption purposes. 

New grants of special leave to appeal to the High Court of Australia

Last Friday, 13 December 2013, the High Court granted special leave to appeal in three cases.

The first is Commonwealth Bank of Australia v Barker.  In that case Mr Barker was employed by the Bank as an executive manager.  His contract of employment entitled the Bank to terminate his employment without cause on four weeks’ written notice.  His position became redundant.  In the letter informing him of this redundancy, the Bank told Mr Barker its preference was to redeploy him to a suitable position within the Bank. Ultimately, however, the Bank terminated his employment.  Mr Barker sued the Bank for breach of contract, and for misleading and deceptive conduct.  He argued that certain written policies of the Bank dealing with redundancy were incorporated into his contract of employment, and that the Bank had breached those policies. The primary judge held that the policies were not incorporated into his contract of employment.  However, the primary judge found that the contract of employment contained an implied term of mutual trust and confidence.  His Honour also found that the Bank had been almost totally inactive in complying with its redundancy policies in relation to Mr Barker, and that this was a serious breach of the implied term of mutual trust and confidence which sounded in damages. His Honour awarded Mr Barker damages of $317,000 for loss of the opportunity to be redeployed to a suitable position within the Bank.  The main issue in the appeal is whether or not the implied term of mutual trust and confidence forms part of the common law of Australia.

The second case is Lee v The Queeen.  The appellants in this appeal were the unsuccessful appellants in Lee v The Queen, in which the High Court upheld orders made in favour of the NSW Crime Commission that the appellants be compulsorily examined under the Criminal Assets Recovery Act 1990, even though the subject matter of the examinations overlapped with the subject matter of the criminal proceedings.  In this latest appeal, the Lees challenge the dismissal of their appeals against conviction by the NSW Court of Criminal Appeal.  The main ground of general importance is the question of whether or not there had been a miscarriage of justice because a transcript of the evidence given before the Crime Commission had been released, unlawfully, to the DPP prior to the trial.

The third case is Sidhu v Van Dyke.  In this case Van Dyke claimed that Sidhu, with whom she was in a romantic and sexual relationship over several years, made clear and unambiguous promises to her on several occasions that a property known as Oaks Cottage was her home and that he would transfer it to her (or procure its transfer to her). She also claimed that she acted reasonably in reliance on those promises to her detriment, including by performing certain tasks for the benefit of Sidhu and by remaining in part-time employment. Van Dyke commenced proceedings claiming an order that Oaks Cottage be transferred to her, or a declaration recognising her interest in Oaks Cottage by way of constructive trust or charge, or an order for the payment of equitable compensation to her. The primary judge held that the effect of the evidence given by Van Dyke during cross-examination was that it was entirely possible that Van Dyke would have remained living on the property, carrying out tasks on the property (even if not to the extent of the work she in fact carried out) and working part-time, whether or not the promises had been made. According to the primary judge, that made it impossible to find that she was acting in reliance on the promises to her detriment. The NSW Court of Appeal, applying a number of English decisions, held that there was a presumption of reliance which had not been displaced by Van Dyke’s evidence, and that it was not necessary for the plaintiff to prove that “but for” the promises she would not have acted in the way she did; it was sufficient that it was a cause, even if not the sole cause. In addition, the Court of Appeal held that the measure of compensation was not the detriment suffered by Van Dyke, rather it was the value of the unfulfilled promises.  Both of those issues fall for determination in the appeal to the High Court.

Judgments this week in the High Court of Australia

On Wednesday, 18 December 2013 the High Court will end the year by delivering judgment in four cases.

The first is Clark v Macourt.  In this case Clark and a company known as St George Fertility Clinic Pty Ltd carried on business providing assisted reproduction technology services in Sydney.  The appellant and St George entered into a deed in which the appellant purchased the business carried on by St George, along with various assets of the business.  Macourt was a party to the deed as guarantor of the obligations of St George.  The assets of the business that were sold to Clark included frozen sperm.  Of the 3,513 straws of sperm only 504 were useable.  Because of her inability to use the majority of the sperm supplied by St George, Clark ceased making payments due under the deed.  St George commenced proceedings for the balance of the purchase price, and Clark cross-claimed for damages for breach of contract relating to the unsuitability of the sperm sold by St George. St George (and Macourt) ultimately conceded the breach of contract.  At issue in the proceedings is how damages are to be assessed. This raises important issues as to the relevance of the regulatory regime in which assisted reproductive technology services are provided, whether damages are to be assessed by reference to the cost of replacement sperm or alternatively the value of the St George sperm had she been able to use it, and the extent to which payments made by patients mitigated her loss.

Next is Reeves v The Queen.  Reeves was infamously dubbed “The Butcher of Bega” by the press.  The main issue on appeal arises out of his conviction for the offence of maliciously inflicting grievous bodily harm with intent, contrary to section 33 of the Crimes Act 1900 (NSW). This charge arose out of the performance of a vulvectomy.  The applicant had been prosecuted for the offence of female genital mutilation (section 45) but the jury had been unable to reach a verdict.  The alternative charge gave rise to the issue of whether or not the patient had consented to the operation (or more accurately, whether the applicant did not have an honest belief that the patient had so consented).  One question on the appeal is what is the correct test for consent in a criminal medical assault case, and in particular does it involve any of the ingredients of “informed consent” as applied in civil cases.  There is also a question of whether the CCA erred in applying the proviso, as well as a challenge to the sentence imposed by the CCA.

Judgment will also be delivered in Unions NSW v State of New South Wales. This is a challenge to laws enacted by the O’Farrell Government restricting funding and expenditure of political parties, candidates for and members of the NSW Parliament, and third party campaigners.  Section 96D of the Election Funding, Expenditure and Disclosures Act 1981 (NSW) now prohibits any such person or body from accepting political donations unless the donor is an individual who is enrolled to vote (previously, political donations could also be made by any entity with an Australian Business Number). Section 95F prescribes caps on the amounts of “electoral communication expenditure” that can be made by parties, candidates and third party campaigners for a State election campaign.  Where the expenditure of a party is less than or equal to the cap, section 95G operates to add any electoral communication expenditure made by “affiliated organisations”, namely bodies authorized by a party’s rules to participate in the pre-selection of candidates, or to appoint delegates to the party’s governing body. The vast majority (in dollar terms) of political donations made to the major parties in NSW have been made by organisations and associations rather than by individuals. The party with the highest proportion of non-individual donations is the NSW branch of the ALP.  The plaintiff in these proceedings challenges the validity of the new funding provisions on the grounds that they impermissibly burden the implied freedom of communication on governmental and political matters, or a freedom of association, contrary to the Commonwealth Constitution, or alternatively contrary to the NSW Constitution.

Finally, judgment will be delivered in Commonwealth Minister for Justice v Adamas.  This case considers the interaction between the extradition treaty with Indonesia, and the Extradition Act 1988 (Cth).  In particular, it will consider the proper role of a court undertaking judicial review of the decision of the Attorney-General to determine that it would not be “unjust, oppressive or incompatible with humanitarian considerations” to surrender the respondent to Indonesia. 

Summary of High Court decision in same-sex marriage challenge

The High Court of Australia has unanimously today upheld the Commonwealth’s challenge to the validity of the ACT’s same-sex marriage laws.

The suggestion made in this blog yesterday that the Court would only make orders with reasons to follow at a later date was too pessimistic an assessment of the Court’s capacity to provide a reasoned judgment.

In those reasons for judgment, the Court agreed with the consensus position submitted by the Commonwealth and the ACT that the reference to “marriage” in the Constitution includes same-sex marriage, thus confirming that the Commonwealth could, if it chose to do so, legislate with respect to same-sex marriage.

However, ultimately the Court held that the ACT’s Marriage Equality (Same Sex) Act 2013 could not operate concurrently with the Commonwealth Marriage Act 1961.  The ACT law was therefore inoperative.  Their reasons for so holding are commendably clear and concise:

It is necessary to bear steadily in mind that the federal Parliament has power under s 51(xxi) to make a national law with respect to same sex marriage. (The Parliament’s power under s 122 of the Constitution to make laws for the government of any Territory need not be considered.) The federal Parliament has not made a law permitting same sex marriage. But the absence of a provision permitting same sex marriage does not mean that the Territory legislature may make such a provision. It does not mean that a Territory law permitting same sex marriage can operate concurrently with the federal law. The question of concurrent operation depends upon the proper construction of the relevant laws. In particular, there cannot be concurrent operation of the federal and Territory laws if, on its true construction, the Marriage Act is to be read as providing that the only form of marriage permitted shall be a marriage formed or recognised in accordance with that Act.

The Marriage Act regulates the creation and recognition of the legal status of marriage throughout Australia. The Act's definition of marriage sets the bounds of that legal status within the topic of juristic classification with which the Act deals. Read as a whole, the Marriage Act, at least in the form in which it now stands, makes the provisions which it does about marriage as a comprehensive and exhaustive statement of the law with respect to the creation and recognition of the legal status of marriage. Why otherwise was the Marriage Act amended, as it was in 2004, by introducing a definition of marriage in the form which now appears, except for the purpose of demonstrating that the federal law on marriage was to be complete and exhaustive?

The 2004 amendments to the Marriage Act made plain (if it was not already plain) that the federal marriage law is a comprehensive and exhaustive statement of the law of marriage. Those amendments applied the newly introduced definition of marriage to the provisions governing solemnisation of marriage and gave effect to that definition in the provisions governing the recognition of marriages solemnised outside Australia. Section 88EA of the Marriage Act (inserted by the 2004 amendments) provides expressly that a union solemnised in a foreign country between persons of the same sex must not be recognised as a marriage in Australia.

These particular provisions of the Marriage Act, read in the context of the whole Act, necessarily contain the implicit negative proposition that the kind of marriage provided for by the Act is the only kind of marriage that may be formed or recognised in Australia. It follows that the provisions of the ACT Act which provide for marriage under that Act cannot operate concurrently with the Marriage Act and accordingly are inoperative. Giving effect to those provisions of the ACT Act would alter, impair or detract from the Marriage Act. Within the Commonwealth, the Marriage Act determines the capacity of a person to enter the union that creates the status of marriage with its attendant rights and obligations of mutual support and advancement. Under the Marriage Act, a person has no legal capacity to attain that status, with the rights and obligations attendant on it, by entry into a union with a person of the same sex.

The full text of the judgment is available here.