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[2006] HCA 23
High Court of Australia
2006-05-18
Gleeson CJ, Crennan JJ
Original judgment source is linked above.
GUMMOW, KIRBY, HAYNE, CALLINAN, HEYDON AND CRENNAN JJ
On appeal from the Supreme Court of New South Wales
R C Kenzie QC with M J Kimber SC for the appellants (instructed by Turner Freeman)
D E Grieve QC with J M Miller for the first respondent (instructed by Pryor Tzannes & Wallis)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
Industrial law (NSW) - Industrial Relations Commission - Jurisdiction - Power given to the Commission by s 106(1) of the Industrial Relations Act 1996 (NSW) to declare wholly or partly void, or to vary, any contract whereby a person performs work in any industry if the contract is an unfair contract - Option to acquire shares in company pursuant to an option deed - Option deed made as part reward to option holder as promoter of company - Application to Commission for orders declaring the option deed unfair, harsh, and unconscionable and contrary to the public interest, and orders varying the deed - Whether the option deed was a contract or arrangement according to which the first appellant performed work in any industry - Relevance of the fact that the work performed pre-dated the option deed.
Industrial law (NSW) - Industrial Relations Commission - Writ of prohibition sought to restrain the Commission from exercising jurisdiction - Entitlement of the Commission to determine its own jurisdiction in first instance.
Prerogative writs - Prohibition - Excess of jurisdiction - Industrial Relations Commission (NSW) - Whether writ lies in the circumstances - Commission in Court Session a superior court of record of limited jurisdiction equivalent in status to the Supreme Court - Whether application for prohibition premature -Likelihood or danger of order being made in excess of jurisdiction - Relevance of privative provision purporting to exclude issue of writ - Relevance of specialist subject-matter of disputes before the Commission.
Statutes - Privative clause - Industrial Relations Commission (NSW) - Whether privative provision applicable - Relevance of interlocutory decision of the Commission dismissing a motion by the respondent for pre-emptive relief.
Statutes - Construction - Interpretation - Remedial statute - Purposive approach to construction - Objects of statute.
Statutes - Construction - Interpretation - Composite phrase incorporating technical words - Extrinsic matters - Legislative history - Relevance of Parliament's purpose of successive re-enactment in increasingly ample terms.
Words and phrases - "any contract whereby a person performs work in any industry", "any related condition or collateral arrangement", "arrangement", "decision or purported decision", "industry".
Industrial Relations Act 1996 (NSW), ss 105-109A, 152, 179.
"Although the summons in the commission seems to rely on a contract or arrangement for the performance of work which pre‑dated the formation of the company, [counsel for Mr Batterham and Maylord] did not attempt to support a case of that width. Instead he relied on a contract or arrangement which came into existence after incorporation under which the company took the benefit of the pre‑incorporation work."
The appellants contended that this misunderstood the breadth of their submissions to the Court of Appeal. Given what was said by Handley JA about QSR having accepted the benefit of work done before incorporation but that any contract or arrangement to that effect was not one whereby a person performed the pre‑incorporation work, it may well be doubted that the reasons, when read as a whole, betray a misunderstanding of the kind asserted. It is, however, not necessary to explore that question further. Rather, attention must be directed to the appellants' contention that they should have been permitted to seek to establish, in the proceedings in the Commission, either or both of two propositions. The first of those propositions was that, before QSR was incorporated, parties, other than QSR, had made an arrangement for the performance of work which included the incorporation of QSR and the work later done for QSR. The second was that, upon its incorporation, QSR either became a party to the arrangement or thereafter took the benefit of the arrangement. Each of these propositions fastened upon three facts. First, Mr Batterham performed work promoting the company, negotiating the purchase contract, arranging finance and then serving as a director. Second, the option deed was of benefit to Mr Batterham. Third, he obtained that benefit because he was a promoter of the venture and of QSR. But the relevant question presented by s 106 is not to be answered by doing no more than pointing to the performance of work and the obtaining of a benefit that is in some way connected to the performance of the work. Rather, for the reasons given in Fish v Solution 6 Holdings Ltd, the critical questions are what is the work a person performs in an industry and what is the contract whereby the person performs that work?
"A promoter is not entitled to recover any remuneration for his services from the company unless there is a valid contract, enabling him to do so, between him and the company … Until the company is formed it cannot enter into a valid contract[12]. …
The reward may take many forms. … [One] is for the promoter to be given an option to subscribe for shares at a particular price (eg par) within a specified time. If the shares have meanwhile gone to a premium this will obviously be a most valuable right; it is a perfectly legal arrangement[13], but particulars of the option have to be given in any prospectus …"
"(1) Subject to the exercise of a right of appeal to a Full Bench of the Commission conferred by this or any other Act or law, a decision or purported decision of the Commission (however constituted):
(b) may not be appealed against, reviewed, quashed or called in question by any court or tribunal (whether on an issue of fact, law, jurisdiction or otherwise).
(2) A judgment or order that, but for this section, might be given or made in order to grant a relief or remedy (whether by order in the nature of prohibition, certiorari or mandamus, by injunction or declaration or otherwise) may not be given or made in relation to a decision or purported decision of the Commission, however constituted.
(3) To avoid doubt, this section extends to any decision or purported decision of the Commission, including an award or order of the Commission."
"[A preliminary hearing is] sensible ... where a party has a substantial threshold argument which, if it succeeds, will knock out the claim and save the costs and inconvenience that attend a protracted hearing of proceedings on the merits. But, as with any threshold relief of this kind, it must be conserved to a clear case where it is plain that the invocation of the jurisdiction impugned is wholly misconceived or, upon analysis, lacks an arguable legal foundation. Necessarily, refusal of relief at the threshold will not finally determine that jurisdiction exists for any order which the Commission might make between the parties. This is because, to secure relief, the claimants must demonstrate that no order could be made which would be within jurisdiction. This burden … is a heavy one".
(1) The privative clause issue: Did the Court of Appeal err, the jurisdiction and powers of the Commission having been invoked, in calling into question a decision of the Commission on a matter within the Commission's jurisdiction? Did doing this constitute a breach of, or failure to comply with, s 179 of the IR Act so that, on that ground, it was legally erroneous?
(2) The comity and restraint issue: Whatever the strict requirements of s 179 of the IR Act, did the Court of Appeal err in its approach to the entitlement of the Commission in Court Session to determine its own jurisdiction and, having regard to the applicable principles of restraint, did it err in affording relief when it did, before the Commission had heard and finally determined the application before it?
(3) The substantive rights issue: Assuming that there is no impediment to the Court of Appeal's orders on either of the foregoing grounds, did the Court of Appeal err in providing the relief it did, having regard to whether the case before the Commission was reasonably arguable? Was that case clear in fact and in law to the degree that warranted intervention by the Court of Appeal in advance of a concluded hearing and decision of the Commission about its jurisdiction and powers?
(1) Subject to the exercise of a right of appeal to a Full Bench of the Commission conferred by this or any other Act or law, a decision or purported decision of the Commission (however constituted):
(b) may not be appealed against, reviewed, quashed or called in question by any court or tribunal (whether on an issue of fact, law, jurisdiction or otherwise).
(2) A judgment or order that, but for this section, might be given or made in order to grant a relief or remedy (whether by order in the nature of prohibition, certiorari or mandamus, by injunction or declaration or otherwise) may not be given or made in relation to a decision or purported decision of the Commission, however constituted.
(3) To avoid doubt, this section extends to any decision or purported decision of the Commission, including an award or order of the Commission."
"[T]he final words 'quashed or called in question in any court of law' seem to their Lordships to be clearly directed to certiorari. 'Quashed' is the word ordinarily used to describe the result of an order of certiorari, and it is not commonly used in connection with other forms of procedure (except in the quite different sense of quashing a sentence after conviction on a criminal charge). If 'quashed' were for some reason not enough, the expression 'called in question in any court of law' is in their Lordships' opinion amply wide enough to include certiorari procedure. Accordingly they are of opinion that paragraph (a) does oust certiorari at least to some extent."
(1) The first suggested reason was that the decision of the Commission was interlocutory and thus did not create any res judicata or issue estoppel[52]. There is nothing in s 179 that draws any such distinction. Decisions and purported decisions, as well as awards and orders, referred to in the section, may be interlocutory as well as final. The section still applies. The suggested gloss, exempting interlocutory decisions and orders, would be perverse and confusing, given the uncertainty that can sometimes arise over such classifications. There is no reason for this Court to lend support to such a modification of the statute.
It was then suggested that the fact that the Court of Appeal "after fuller argument" concluded that the Commission's jurisdiction did not extend to any relevant contract or arrangement would not "call in question" the interlocutory decision[53]. However, the place for "fuller argument", contemplated by s 179 (in its language, history and purpose), was not the Court of Appeal. It was either in the Commission when it conducted the hearing, or in the Full Bench of the Commission in Court Session, as the IR Act provides[54]. The very mischief addressed by s 179 is the conduct of "fuller argument" in a court of general jurisdiction, separate from the industrial tribunal which Parliament has entrusted with jurisdiction under s 106 of the IR Act, including decisions as to whether it has jurisdiction in the particular case or not. In so far as Handley JA's reasoning contained a suggestion that the Court of Appeal's position was effectively no different from that of the Commission at a final hearing, that suggestion was incorrect. In a final hearing of the proceeding in the Commission all the evidence that the parties considered relevant would be tendered; the admissibility of that evidence would be decided by the judicial member of the Commission hearing the case; and findings and rulings would be made by that judicial member, who could also make orders to give effect to such conclusions. In the event, the Court of Appeal was obliged to reach its decision on materials more abbreviated than those available in a final hearing before the Commission. That is a procedure which, even when legally permissible, is reserved to very clear cases. By reaching a different conclusion on the jurisdiction question, the Court of Appeal did not suggest any identified error on the part of Peterson J. It simply substituted its own opinion on the same substantive issues, using effectively identical material and reaching its conclusion in a like pre-emptory process. The only suggested advantage of the Court of Appeal was "fuller argument". However, that does not authorise circumvention of s 179(1) of the IR Act and the legislative policy that it expresses.
(2) Secondly, Handley JA appeared to consider that the course adopted by the majority was sustained by this Court's approach in R v Australian Stevedoring Industry Board; Ex parte Melbourne Stevedoring Co Pty Ltd[55]. Although the joint reasons in this Court endorse that conclusion[56], in my view it is erroneous[57].
Melbourne Stevedoring involved a challenge to an inquiry held by a delegate of the Stevedoring Industry Board, otherwise than as authorised by its legislation, to consider the fitness of an employer to be registered under federal law. Instead, the Board imposed a sanction on an employer to enforce a policy of the Board. This was a completely erroneous conception of the Board's jurisdiction and powers. The error was fundamental to the exercise of the power and pervasive in the case.
There was no similar fundamental error in the perception by Peterson J of the jurisdiction of the Commission based on the Option Deed. Even if there were, it was not for the Court of Appeal to call into question here his Honour's decision that the jurisdiction of the Commission sufficiently existed. And even if, in some way, the Court of Appeal was authorised to ignore and bypass the decision of Peterson J in the Commission, the supposed error of classifying the deed for the purposes of s 106 of the IR Act was not of the character of the error described in Melbourne Stevedoring.
It is essential to the concept of jurisdictional error (sometimes supported in federal matters as inherent in the nature and purpose of the writs afforded by the Constitution[58]) that tribunals afforded jurisdiction by Parliament must be respected by the courts. They must normally be allowed to determine, at least in the first instance, whether they have jurisdiction and, whilst acting within it, to exercise that jurisdiction without external judicial interference. The restraints that ordinarily operate in federal jurisdiction are reinforced in a case of the present kind by the privative provisions of s 179 of the IR Act.
Principles of comity and restraint deny intervention
"152 Commission in Court Session superior court of record
(1) The Commission in Court Session is established by this Act as a superior court of record.
(2) For the purposes of Part 9 of the Constitution Act 1902, the Commission in Court Session is a court of equivalent status to the Supreme Court and the Land and Environment Court, and is of higher status than the courts referred to in section 52(2)(b) and (c) of that Act."
"The injunction to judicial comity does not merely advance mutual politeness as between judges of the same or co-ordinate jurisdictions. It tends also to uphold the authority of the courts and confidence in the law by the value it places upon consistency in judicial decision-making and mutual respect between judges."
"It does not seem to me that that would be an appropriate course to adopt. First, it is not the function of this Court to supervise the parsing of proceedings in the Commission into aspects within the jurisdiction of the Commission and aspects not within its jurisdiction, a task which in any event could not readily be undertaken … Secondly, because the proceedings in the Commission must begin with a finding of what the contract was, and if it be found that the contract was as asserted by the claimants there is ready opportunity for the fullest exercise of jurisdiction. It therefore does not seem to me that the task can be carried out at all, because it cannot be said that there are aspects of any significance which are clearly outside the Commission's jurisdiction. Thirdly, and most important, I repeat that I do not accept that the Commission will not recognise, if the position so arises, that there is some particular aspect of the proceedings before it which exceeds its jurisdiction, and act accordingly."
"While it is apparently true that (at least some of) this work was performed before QSR came into existence, I am not persuaded at this stage that QSR could not have become a party to the arrangement and accepted some burden thereunder or, alternatively could not be made a party to the proceedings, even if not a party to the arrangement, if it may be shown that QSR took the, or some, benefit under it."
"An interlocutory decision of this kind does not pre-judge the final decision or create any res judicata or issue estoppel. A final decision in the commission that it lacked jurisdiction in whole or in part would not call in question the interlocutory decision that the case should go to trial. The position is no different here. The fact that this court, after fuller argument, might conclude that the commission's jurisdiction does not extend to any contract or arrangement which pre-dated the incorporation of the [first respondent] would not call into question the interlocutory decision of Peterson J."
QSR Ltd v Industrial Relations Commission of New South Wales (2004) 208 ALR 368. ↑
Fish v Solution 6 Holdings Ltd [2006] HCA 22; Old UGC, Inc v Industrial Relations Commission of New South Wales in Court Session [2006] HCA 24. ↑
Solution 6 Holdings Ltd v Industrial Relations Commission of New South Wales (2004) 60 NSWLR 558. ↑
Maylord Equity Management Pty Ltd v QSR Ltd [2003] NSWIRComm 366. ↑
The Commission in Court Session has since been re-named, once again, as the Industrial Court of New South Wales: Industrial Relations Amendment Act 2005 (NSW), s 3, Sched 1, cl 4. ↑
The extent of the determination of the Parliament of New South Wales to discourage and repel such interventions can be seen in the still more emphatic language of s 179 of the IR Act following the amendments introduced by the Industrial Relations Amendment Act 2005 (NSW), s 3, Sched 1, cl 5. ↑
See Woolcock Street Investments Pty Ltd v CDG Pty Ltd (2004) 216 CLR 515 at 565-566 [138] applying E (A Minor) v Dorset County Council [1995] 2 AC 633 at 694 per Sir Thomas Bingham MR. ↑
Judicial comity in this context is an antithesis of judicial chauvinism: see Hicks [2003] FCA 757 at [76] per French J quoted above at [73]. ↑
[2006] HCA 22 at [143]; cf Mitchforce Pty Ltd v Starkey (No 2) (2003) 130 IR 378 at 436 [212]-[213]. ↑
See, eg, Mitchforce (2003) 130 IR 378 at 386 [22]. ↑
IR Act, s 7 (definition of "industry"), ss 105, 106. ↑
Cf Mitchforce (2003) 130 IR 378 at 436 [212]-[213]. ↑
IR Act, s 105 in reference to the definition of "contract" which means "any contract or arrangement, or any related condition or collateral arrangement, but does not include an industrial instrument". See also s 106(2) referring to "variation of the contract"; s 106(3) referring to variation "from some other time"; s 106(4) referring to a "series of contracts"; and s 106(5) referring to wide powers to make orders for the payment of money, including against non-parties. ↑
Brown v Rezitis (1970) 127 CLR 157 at 164; Stevenson v Barham (1977) 136 CLR 190 at 192. ↑
(2004) 208 ALR 368 at 379 [55]. See also the references to the "principle of restraint" and to relevant cases in Solution 6 Holdings (2004) 60 NSWLR 558 at 591-595 [136]-[145]. ↑
See, eg, Maltais v Industrial Commission (NSW) (1986) 14 IR 367 at 368. ↑
Ballam v Higgins (1986) 17 IR 131; cf Mitchforce (2003) 130 IR 378 at 436 [213] per Boland J. ↑
Batterham
QSR Limited
(1964) 112 CLR 125
(2004) 208 ALR 368
(1945) 70 CLR 598
(2003) 211 CLR 476
(1991) 171 CLR 232
(1942) 66 CLR 161
(1953) 88 CLR 100
(2004) 60 NSWLR 558
(1993) 51 IR 8
(1991) 28 NSWLR 443
(1909) 10 CLR 114
(1982) 154 CLR 25
(2004) 138 FCR 475
(1984) 155 CLR 107
(1994) 181 CLR 18
(2004) 216 CLR 515
(2003) 130 IR 378
(1970) 127 CLR 157
(1977) 136 CLR 190
(1986) 14 IR 367
(1986) 17 IR 131
(2005) 146 IR 99
(1924) 34 CLR 328
(1953) 87 CLR 548
(1958) 98 CLR 1
(2000) 169 ALR 344
(1990) 33 IR 139