Quickenden v Commissioner O'Connor of the Australian Industrial Relations Commission

Black CJ, and French J: Introduction 1 Dr Terry Quickenden, a Senior Lecturer at the University of Western Australia ("the University") challenges the validity of a certified agreement made under the Workplace Relations Act 1996 (Cth) between the University and the National Tertiary Education Industry Union ("the Union"). He is not a member of the Union but would be bound by the agreement if valid. He also challenges the validity of the provisions of the Workplace Relations Act under which the agreement was certified and which give it force and effect. The challenge, which was commenced in the High Court by way of motion for orders nisi for prerogative relief against the Commission, was remitted to this Court and the motion dismissed by Lee J. Dr Quickenden has appealed to the Full Court against that decision. The issues in the appeal concern the scope of the power of the Commonwealth to make laws with respect to trading or financial corporations (Constitution s 51(xx)), whether the relevant provisions of the Workplace Relations Act are laws with respect to such corporations and whether the University is a trading or financial corporation to which those laws apply. There is a separate question whether the certified agreement, by its effect on Dr Quickenden's pre-existing common law contractual rights, amounts to an acquisition of property required to be on just terms pursuant to s 51(xxxi) of the Constitution. The costs order made by his Honour is also challenged. Factual Background 2 On 10 March 1997, the University made an agreement with the Union. The agreement, known as the University of Western Australia Academic, Academic Research and Related Staff Agreement 1997, purported to be binding, according to its terms, on the University, the Union and all persons whose employment was subject to the agreement (cl 4). It was made pursuant to s 170LJ of the Workplace Relations Act and, according to its terms, applied to the University and to academic staff whose terms and conditions were provided by the Awards set out in Schedule A to the agreement and who were members or were eligible to be members of the Union (cl 3). The agreement took effect from the beginning of the first pay period commencing on or after the date of its certification under the provisions of the Workplace Relations Act and was to remain in force until 31 March 1999 (cl 5). 3 On 11 April 1997, the University and the Union made application to the Australian Industrial Relations Commission for certification of the agreement under Division 2 Part VIB of the Workplace Relations Act. The application was heard by Commissioner O'Connor on 9 May 1997. It was opposed by Dr Quickenden who was granted leave to intervene for that purpose in the proceedings before the Commission. Dr Quickenden is and was a Senior Lecturer in physical and inorganic chemistry employed by the University. He is not, and never has been, a member of the Union. Nevertheless the agreement applied to him as one who was and is a member of the academic staff of the University and eligible to be a member of the Union. His opposition to the certification of the agreement was based upon the propositions that: 1. The agreement purported to bind him and he did not wish to be bound by it. 2. The University is not a constitutional corporation for the purposes of an application for a certified agreement under Division 2 Part VIB of the Act. 3. Division 2 of Part VIB of the Act is beyond the legislative power of the Commonwealth. Notwithstanding Dr Quickenden's objections, the Commission certified the agreement on 20 June 1997. 4 On 18 December 1997, Dr Quickenden filed a motion in the High Court seeking orders nisi for the issue of writs of certiorari and prohibition against the Commission quashing its certification decision and prohibiting it from certifying or giving effect to the certification of the agreement. On 5 August 1998, Kirby J remitted the proceedings to the Federal Court at its Western Australian District Registry. The motion was heard by Lee J on 8, 9 and 10 March 1999 and on 10 September 1999 his Honour made an order that the motion be dismissed with costs. On 1 October 1999, Dr Quickenden filed a notice of appeal from his Honour's decision. In the meantime, on 22 May 2000, the Australian Industrial Relations Commission certified a new agreement, the University of Western Australia Academic Staff Agreement 2000, which has subsumed the previous agreement here in contention.

The Grounds of the Appeal 5 The grounds of appeal reflected the grounds upon which the prerogative relief was sought. As there is some overlap between them, it is convenient to set them out in substance: 1. The Commission had no jurisdiction to certify an agreement between the University and the Union made binding upon Dr Quickenden when Dr Quickenden was not a party. 2. The Commission has no jurisdiction to certify the agreement because the University is not a constitutional corporation within the meaning of the Workplace Relations Act, that is to say it is neither a trading nor a financial corporation formed within the limits of the Commonwealth. 3. Part VIB of the Workplace Relations Act, under which the Commission purported to act, is ultra vires the power of the Commonwealth under s 51(xx) of the Constitution to make laws with respect to trading or financial corporations formed within the limits of the Commonwealth and the incidental power under s 51(xxxix) in that it purports to confer a power to regulate the internal management of officers and employees of such corporations. 4. The Commission lacked jurisdiction to certify the agreement in that certification contravened the guarantee under s 51(xxxi) of the Constitution by effecting the compulsory acquisition of Dr Quickenden's property, namely his contractual rights, upon other than just terms. In addition, Dr Quickenden seeks an extension of time within which to appeal against the costs order made by his Honour on the basis that, having regard to s 347 of the Workplace Relations Act, no such order ought to have been made. Statutory Framework - The Workplace Relations Act 1996 (Cth) 6 The object of Part VIB of the Workplace Relations Act as it stood in 1997 is "to facilitate the making, and certifying by the Commission, of certain agreements, particularly at the level of a single business or part of a single business" (s 170L). Division 2 of Part VIB deals specifically with agreements involving "constitutional corporations" or the Commonwealth. The division is said to set out the requirements that must be satisfied for applications to be made to the Commission to certify certain agreements between employers who are constitutional corporations or the Commonwealth on the one hand, and organisations of employees or employees on the other (s 170LH). The term "constitutional corporation" is defined in s 4(1) of the Act thus: "Constitutional corporation means: (a) a foreign corporation within the meaning of paragraph 51(xx) of the Constitution; or (b) a body corporate that is, for the purposes of paragraph 51(xx) of the Constitution, a financial corporation formed within the limits of the Commonwealth; or (c) a body corporate that is, for the purposes of paragraph 51(xx) of the Constitution, a trading corporation formed within the limits of the Commonwealth; or (d) a body corporate that is incorporated in a Territory; or (e) a Commonwealth authority." 7 It is a prerequisite of an application made to the Commission under Division 2 that there be: "..an agreement in writing about matters pertaining to the relationship between: (a) an employer who is a constitutional corporation or the Commonwealth; and (b) all persons who, at any time when the agreement is in operation, are employed in a single business, or a part of a single business, of the employer and whose employment is subject to the agreement." (s 170LI(1)). The agreement must be made in accordance with ss 170LKJ, 170LK or 170LL (s 170LI(2)). Section 170LJ, which is the material section for present purposes, provides for agreements between employers and one or more organisations of employees. Agreements may be made with one or more organisations of employees where, when the agreement is made, each such organisation has at least one member employed in the single business or part whose employment will be subject to the agreement (s 170LJ(1)(a)). In addition, the organisation must be entitled to represent the industrial interests of the members in relation to work that will be subject to the agreement (s 170LJ(1)(b)). It is a requirement of s 170LJ that the agreement be approved by a valid majority of the persons employed at the time whose employment will be subject to the agreement (s 170LJ(2)). The term "valid majority" is defined in s 170LE. The details are not material for present purposes, save that it is plain that a valid majority does not require anything more in numbers than a majority of those who validly vote for or otherwise decide to approve the proposed agreement. 8 An application to the Commission to certify such an agreement must state that it is made under Division 2 (s 170LM(1)) and, if it is an agreement under s 170LJ, must be made within twenty one days of the day on which it is approved (s 170LM(2)). 9 The processes for certification of agreements are set out in Division 4. If an application is made to the Commission in accordance with Division 2 or 3 then the Commission must certify the agreement if, and must not certify the agreement unless, the requirements of s 170LI are met (s 170LI(1)). These requirements include satisfaction of the no-disadvantage test, a public interest test, genuine approval by a valid majority of employees if made under s 170LJ, appropriate explanation of the agreement, the inclusion of dispute settlement procedures, the absence of coercion and the inclusion of a nominal expiry date no more than three years after the date on which the agreement comes into operation. 10 Division 5 deals with the effect of a certified agreement. Such an agreement comes into operation when certified (s 170LX(1)). Subject to s 170LX it remains in operation at all times afterwards (s 170LX (1)). It ceases to be in operation if the nominal expiry date has passed and it is replaced by another certified agreement (s 170LX(2)). It also ceases to be in operation if terminated under certain other provisions of the Act. While a certified agreement is in operation, subject to s 170LY, it prevails over an award or order of the Commission, to the extent of any inconsistency with the award. (s 170LY(1)(a)). A certified agreement also prevails over terms and conditions specified in a State law, State award or State employment agreement to the extent of any inconsistency (s 170LZ(1)). 11 Division 6 deals with the persons bound by certified agreements. When the application for certification is made under Division 2 the agreement binds the employer and all persons whose employment is, at any time when the agreement is in operation, subject to the agreement (s 170M(1)). The agreement also binds any organisation of employees which has made the agreement with the employer (s 170M(2)). 12 There is a special provision dealing with the question of costs in proceedings under the Act. It is in the following terms: "347(1) A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under s 170CP) should not be ordered to pay costs incurred by any other party to the proceeding unless the first-mentioned party instituted the proceeding vexatiously or without reasonable cause. (2) "Costs" includes all legal and professional costs and disbursements and expenses of witnesses." Statutory Framework - University of Western Australia Act 1911 (WA) 13 The University of Western Australia is established by the University of Western Australia Act 1911(WA)as a body corporate capable (inter alia) of doing and suffering all such acts and things as bodies corporate may by law do and suffer (s 6). The primary objective of the Act, set out in its preamble, is to provide for "instruction in those practical arts and liberal studies which are needed to advance the prosperity and welfare of the people". The Senate is the governing authority of the University (s 5). It is empowered to appoint deans, professors, lecturers, examiners, and other officers and servants of the University and has the "entire control and management of the affairs and concerns of the University, and may act in all matters concerning the University in such manner as appears to it best calculated to promote the interests of the University" (s 13). It has the control and management of all real and personal property vested in or acquired by the University (s 14). It may, with the approval of the Governor, grant leases of and mortgage such lands although leases up to twenty one years do not require such approval (s 15). It may invest trust monies of the University not immediately required for the purposes of the trust to erect buildings on University land (s 15A). There is provision for the University to raise loans, subject to guarantee by the State Treasurer and the Governor's approval (s 15B). The Senate may also dispose of any real or personal property acquired by gifts, devise or bequest, as it thinks fit (s 16). It is empowered to make by-laws (ss 16A-16B), regulations (s 16E) and statutes (s 31). The statutes may relate, inter alia, to the control and investment of the property of the University (s 31(1)(u)). There is provision for the grant of Crown lands to the University (s 35) and for exemption of its property from rates and taxes (s 36). There is also provision for its public funding by "Such amounts as may be appropriated by Parliament from time to time…" (s 37(b)). All fees and all other moneys received by the Senate under the Act shall be applied solely for the purposes of the University (s 38). Subject to certain exceptions, the provisions of the Financial Administration and Audit Act 1985 (WA), which regulates the financial administration, conduct and reporting of statutory authorities, apply to the University (s 41). Statutory Framework - The Higher Education Funding Act 1988 (Cth) 14 The University relies upon the provisions of the Higher Education Funding Act in support of its characterisation as a trading or financial corporation. In substance, the University submits that students incur a liability to it for part of the cost of their courses which liability is their Higher Education Contribution. Under the statutory scheme provision is made for the Commonwealth to lend to the student an amount equal to the unpaid part of the contribution and apply the amount so lent in discharge of the student's liability to the University. 15 The University is an "institution" for the purposes of the Act (s 4). By s 39 each institution is, in respect of each semester, to require each "contributing student" undertaking a designated course of study at the institution to pay to the institution in respect of that semester "… a contribution ascertained in accordance with this section, towards the costs of the provision of that course of study". There are formulae for the calculation of the contribution amount for pre-1997 students and for later year students (ss 39(3)-(7)). Each unit of study is to be allocated to one of three Bands in accordance with Ministerial guidelines. The contribution is worked out by reference to a prescribed Band amount and a "student load" for the Band. The student load for the Band is the student's student load for the course, in the semester, for units of study in the Band expressed as a proportion of the standard student load for the course in the year in which the semester occurs (s 39(6)). 16 An institution cannot permit a contributing student who is not an excepted student to enrol for, or undertake a designated course of study in a semester unless the student has paid at least seventy five per cent of the contribution and provided a written request to the Commonwealth to pay the remainder of the liability (s 41(1)(a)). Alternatively, a student can be enrolled if the student gives the appropriate officer of the institution a document requesting a loan from the Commonwealth equal to the unpaid part of the contribution and the application of that loan in discharge of the student's liability to pay the unpaid part of the contribution (s 41(1)(b)). 17 There are various other provisions relating to the mechanics of the scheme and the repayment of loans. Those mentioned illustrate the essential characteristics of an obligation imposed on each institution to require payment from students, the creation of a liability for the contribution owed by the student to the institution and the provision for the Commonwealth to lend the requisite amount to the student to discharge that liability. The Decision at First Instance 18 The first contention raised by Dr Quickenden before his Honour was that the conciliation and arbitration power does not authorise legislation whereby agreements or awards can be made which will bind a person who is not a party to any industrial dispute actual or imminent. His Honour accepted that the Parliament could not, under the conciliation and arbitration power, sanction an agreement or award as between an employer and a union which, in settlement of an industrial dispute, purports to impose obligations on a person who is not a member of the union (although it permits agreements and awards to impose obligations on an employer in respect of such a person). But in the absence of any submission that the conciliation and arbitration power would support Division 2 of Part VIB it was unnecessary to consider that issue. For the purposes of the motion his Honour assumed that, if the relevant parts of Part VIB are not within the corporations power, they are beyond the legislative power of the Commonwealth. 19 His Honour then considered the scope of the corporations power. He rejected the Commonwealth submission that the power is plenary in the sense that no conditions apply to its exercise. In so doing he referred to Re Dingjan; Ex parte Wagner (1995) 183 CLR 323. He identified as its ratio the proposition that there must be a sufficient or necessary connection between the law made under the corporations power and a constitutional corporation. The law must fix upon events or circumstances that impact upon, or have significance for, such a corporation by, at least, affecting the activities, functions, relationships or business of the corporation. 20 His Honour then considered the provisions of Part VIB against this criterion. He concluded that the relevant laws in Part VIB in respect of constitutional corporations are principally laws affecting the relationship of employer and employee. A law empowering or controlling a corporation in the relationship it may form with its employees had, in his Honour's view, a necessary or sufficient connection with that corporation by the impact it had upon the activities, functions, relationships or business of the corporation and satisfied the requirements for validity identified in Dingjan. His Honour considered the validity of s 170LM to be not so clear. In binding an employee to an agreement between a constitutional corporation and a union of which the employee was not a member, the Act might be seen as extending its operation to an outsider using a corporation "as a mere peg or reference point for the legislation". Nevertheless his Honour concluded the provision delivered a benefit to such a corporation albeit it was, in his opinion, an "unusual benefit". According to the tests applied in Dingjan it would supply the degree of connection to the corporation necessary to attract the corporations power. 21 Having found the legislation to be within power, his Honour then turned to the question whether the University is a constitutional corporation. Relevantly for this case, that equates to the question whether it is a trading or financial corporation. There was no issue that it was formed within the limits of the Commonwealth. 22 His Honour referred to the authorities on the characterisation of "trading corporations" and the wider application given to that term in recent times. So a public authority established for and carrying out public services could at the same time be a trading corporation by reason of the extent of its involvement in trading pursuits - E v Australian Red Cross Society (1991) 27 FCR 310 (Wilcox J). From Commonwealth v State of Tasmania (1983) 158 CLR 1 (the Tasmanian Dam case) his Honour drew the proposition that as long as the trading activities of a corporation are a substantial part of its activities the fact that it performs functions in the public interest will not deny it the character of a trading corporation. He relied especially upon the reasoning of Mason J which his Honour saw as encapsulating the opinion of the majority. 23 Turning to evidence of the activities of the University, his Honour found that its Annual Reports for 1995, 1996 and 1997 showed that it had engaged in activities that could properly be characterised as trading. He referred to its conduct of the annual Festival of Perth and revenue generated by ticket sales therefrom and to its sale of publications and services. He also noted that under the name Withrop Technology the University sold computing equipment and services in 1996 and 1997, returning gross revenue of $4.8 million and $7.1 million in those years respectively. Fees and charges collected from overseas students in 1997 amounted to $22.5 million. Accommodation services were provided by the University under the business name "Currie Hall" yielding fees of $1.6 million in 1997. Parking fees in that year returned $0.8 million. His Honour observed that: "In earlier times the provision of such services and the collection of fees therefor, may have been regarded as an incidental activity necessary for the operation of the University as an institution of learning, not able to be isolated to make the University a trading corporation but the activity must be considered in conjunction with other activities of a trading nature that are undertaken to provide the University with sources of revenue that enable the University to carry on the enterprise of offering education services in return for fees." (par 50) He also characterised the University as "…more than a passive investor receiving interest or dividends from investments". It bought and sold properties and obtained revenue as the lessor of a substantial number of properties. Although the funds and property may have originated in grants, bequests, gifts and endowments of land "…the activities of the University as a lessor and as a developer of land are of such a scale that they may be regarded as part of the business carried on by the University" (par 51). 24 The trading activities adverted to in the judgment at first instance were found to represent a substantial part of the operations of the University. Even allowing for the development costs of land and property, the net revenue from these activities amounted to about eighteen per cent of its total operating revenue for 1997. The hallmarks of a trading corporation were satisfied by these facts and the University was found to be a trading corporation. 25 Although it was strictly unnecessary to do so, his Honour went on to consider whether the University was also a financial corporation. He referred to State Superannuation Board v Trade Practices Commission (1982) 150 CLR 282 where it was held that investment in loan transactions, including short term loans and use of the skill and advice of persons with expertise in matters of finance to form financial judgments on investment decisions, gave the Board the character of a financial corporation, such activities being carried out on a sufficiently significant scale. He referred to the placement by the University of substantial funds and deposits on the short-term money market and in short-term bills. He inferred from the level of investment activities that considerable administrative services were devoted to them and that they involved the use of financial skills assisted by sound financial advice. His Honour concluded that, having regard to their more than incidental role, these activities led to the conclusion that the University could also be described as a financial corporation in the constitutional sense. 26 The last issue considered by his Honour was whether the certification of the agreement involved an acquisition, other than on just terms, of Dr Quickenden's common law rights arising under his contract of employment with the University. It was not in contention that a contractual right, amounting to a chose in action, was property for the purposes of s 51(xxxi) of the Constitution. It was not conceded however that Dr Quickenden's contract provided valuable rights or interests able to be regarded as property. But on the assumption that it did, his Honour concluded that there was no acquisition. The contract was subject to the Tenure Regulations of the University which provided that Dr Quickenden's employment was subject to the terms of any award or registered agreement pertaining to his employment under appropriate industrial relations legislation. The Tenure Regulations were ambulatory in nature and broad enough to include, as part of the terms of Dr Quickenden's employment, an agreement certified under Part VIB. Moreover, s 170M of the Workplace Relations Act was properly to be characterised as a law with respect to corporations, not with respect to the acquisition of property. So even if there were an acquisition effected by s 170M it was not a law with respect to the acquisition of property attracting the requirements of s 51(xxxi). 27 His Honour dismissed the motion with costs.

The Issues for Determination 28 The issues for determination in this appeal reduced to the validity of the impugned provisions of Part VIB as an exercise of the power conferred on the Commonwealth Parliament by s 51(xx) of the Constitution, and if they be valid, whether the University is a constitutional corporation to which they apply and whether, in any event, the certification of the agreement pursuant to Part VIB amounts to an acquisition of property on other than just terms. The question whether the impugned provisions can be supported by the conciliation and arbitration power in s 51(xxxv) need be answered only if they are not supported by the corporations power. 29 There is an ancillary issue about the order for costs made by his Honour, it being contended by counsel for Dr Quickenden, Ms McLure QC, that no order for costs ought to have been made because of the provisions of s 347 of the Act. To enable this issue to be raised we granted leave to appeal out of time against the order for costs.

The Corporations Power 30 Early consideration of s 51(xx) was affected by the doctrine of reserved State powers and the constructional principle that treated legislative powers conferred by the Constitution as mutually exclusive. On these bases provisions of the Australian Industries Preservation Act 1906 (Cth) prohibiting corporations from engaging in defined anti-competitive conduct were held invalid - Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330. But Griffith CJ, with whom Barton J agreed while publishing separate reasons, considered that if, contrary to his opinion, the power extended to the governance and control of a corporation in domestic intra-state trade it would cover laws prescribing "what officers and servants it shall employ, what shall be the hours and conditions of labour, what remuneration shall be paid to them, and may thus, in the case of such corporations, exercise complete control of the domestic trade carried on by them" (348). That observation, obiter as it was in its context, is interesting for its treatment of terms of employment provided by a corporation as an element of its trade. Isaacs J, in dissent, would have limited the operation of the power to "the conduct of the corporations in relation to outside persons" (396) an application which would not extend to the prescription of "a schedule of wages and hours…for these corporations" (396). 31 The doctrine of reserved State powers passed away with the decision in Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (1920) 28 CLR 129. There was discussion of the corporations power, reflecting some of the approaches taken in Huddart Parker, in theBanking case - Bank of New South Wales v Commonwealth (1948) 76 CLR 1, at 255 (Rich and Williams JJ) and 304 (Starke J). But it was not until Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 that Huddart Parker was effectively overruled. That case did not give rise to any definition of the limits of the power conferred by s 51(xx). Barwick CJ however, rejected any suggestion that the overruling of Huddart Parker implied that "any law which in the range of its command or prohibition includes foreign corporations or trading or financial corporations formed within the limits of the Commonwealth is necessarily a law with respect to the subject matter of s 51(xx)" (489-490). Nor did it follow "that any law which is addressed specifically to such corporations or some of them is such a law" (490). The sections, wrongly found to be invalid in Huddart Parker, were valid "because they were regulating and controlling the trading activities of trading corporations and thus within the scope of s 51(xx)" (490). It is important to note that this was not a definition of the limits of the power. Neither he nor the other Justices were prepared to essay such a definition. 32 The application of the power to "the activities of corporations which fall within its description" was asserted by Barwick CJ in The Queen v Trade Practices Tribunal; Ex parte St George County Council (1974) 130 CLR 533 at 542. The Chief Justice was there in dissent on the question, not going to validity, whether a local authority fell within the class of corporation to which placitum xx, and in that case, the Restrictive Trade Practices Act 1971 (Cth) applied. A similar question arose in The Queen v Federal Court of Australia; Ex parte Western Australian National Football League (Inc) (1979) 143 CLR 190, albeit under the provisions of the Trade Practices Act 1974 (Cth). But neither of those cases, which are referred to later in connection with the test for characterisation of a corporation as "trading" or "financial", considered the scope of the power in relation to such corporations. 33 The scope of the power was the subject of significant elaboration in Actors and Announcers Equity Association of Australia v Fontana Films Pty Ltd (1982) 150 CLR 169. Three of the seven Justices characterised it as plenary. Mason J, with whom Aickin J agreed, said at 207: "Even if it be thought that it was concern as to the trading activities of trading corporations and financial activities of financial corporations that led to the singling out in s 51(xx) of these domestic corporations from other domestic corporations it would be mere speculation to say that it was intended to confine the legislative power so given to these activities. The competing hypothesis, which conforms to the accepted approach to the construction of a legislative power in the Constitution is that it was intended to confer comprehensive power with respect to the subject matter so as to ensure that all conceivable matters of national concern would be comprehended. The power should, therefore, in accordance with that approach, be construed as a plenary power with respect to the subjects mentioned free from the unexpressed qualifications which have been suggested." Murphy J also regarded the power as plenary observing that it enabled Parliament "to make comprehensive laws covering all internal and external relations of foreign trading and financial corporations" (212). The power would authorise "…laws dealing with industrial relations so that in relation to such corporations Parliament, uninhibited by limitations expressed in s 51(xxv), may legislate directly about the wages and conditions of employees and other industrial matters" (212). This reflected the consequence adumbrated by Griffiths CJ and Barton J in Huddart Parker on the hypothesis that the power was plenary. Stephen J, without making any general statement about its scope, appeared to reject the assumption that it was confined to the trading activities of a trading corporation (195). Brennan J raised the question whether a law which discriminated between constitutional corporations and the public at large fell within its ambit. But it was not necessary, in his opinion, to answer that question. The question which had to be answered was whether a law affording a discriminatory protection to the businesses of trading corporations was valid (219). His Honour answered that narrower question in the affirmative. In so doing he held that the validity of a law under pl (xx) could not be determined "as though the power were expressed as a power to make laws with respect to the trading or some other activities of or relationship with corporations mentioned in par (xx)" (222). 34 Gibbs CJ, with whom Wilson J agreed, took a less expansive view observing that "the words of par (xx) suggest that the nature of the corporation to which the laws relate must be significant as an element in the nature or character of the laws, if they are to be valid" (182). Nevertheless a law could be one with respect to a trading corporation although it cast an obligation on a person other than a trading corporation (183). The Chief Justice's remarks in his subsequent judgment in the Tasmanian Dam case suggest that in respect of trading corporations, he would have confined the ambit of the power to a power to make laws with respect to their trading activities. That limitation did not reflect the preponderance of views in the Actors Equity case nor in later cases. If there were a preponderance of views in the Actors Equity case it would appear to have been in favour of a plenary power and not so limited.

35 The corporations power, among others, again fell for consideration in the Tasmanian Dam case. Section 10 of the World Heritage Properties Conservation Act 1983 (Cth) prohibited constitutional corporations from damaging or destroying property to which a proclamation made by the Governor-General under s 7 of the Act applied. Proclamations had been made in relation to certain areas of Tasmania affected by a proposed dam and hydro-electric scheme to be carried out by the Hydro-Electric Commission of Tasmania. Gibbs CJ was of the view that the Commission was not a trading corporation but concluded that even if it were and ss 7 and 10 were valid, they "could apply to the Commission only in relation to such of its activities as are properly regarded as trading activities" (117). Mason, Murphy and Deane JJ took a broader view of the power as plenary and as supporting ss 7 and 10 (148, 179 and 268). Brennan J posited, as a necessary condition of validity, that the law must discriminate "that is to say, it must be a law which operates to confer a benefit or impose a burden upon those persons when its operation does not confer a like benefit or impose a like burden on others…". However his Honour found it necessary to deal only with the issue of validity of one subsection of s 10 which expressly limited the prohibited conduct to conduct for the purposes of the trading activities of bodies corporate to which it applied (241). Wilson J held that the law was not "about trading corporations" but the "protection and conservation of property" (202). Dawson J said that "[f]or a law to be a valid law with respect to a trading or financial corporation the fact that it is a trading or financial corporation should be significant in the way in which the law relates to it" (316).

36 There was no majority formulation of a single test in the Tasmanian Dam case but wide views of the corporations power were expressed in a number of the judgments in Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 which was concerned with the validity of ss 127A, 127B and 127C of the Industrial Relations Act 1988 (Cth). Those provisions, enacted in reliance upon s 51(xx), empowered the Australian Industrial Relations Commission to review contracts for services binding on independent contractors on the grounds that they were unfair, harsh or against the public interest. They were held invalid as not being laws with respect to corporations and not able to be read down to within valid limits. They could have operated on contracts between persons none of whom was a trading corporation. They were too remotely connected to trading corporations to be characterised as laws with respect to them. It is however the criteria for characterisation advanced in that case that are relevant for present purposes. The majority judgments were those of Brennan, Dawson, Toohey and McHugh JJ. Brennan J, applied his previously formulated discrimination test specifying as the condition of validity of a law made under s 551(xx) that it "… discriminate between constitutional corporations and other persons, either by reference to the persons on whom it confers rights or privileges or imposes duties or liabilities or by reference to the persons whom it affects by its operation" (336). His Honour saw no difference between that test and the test proposed by Gibbs CJ in the Actors Equity case that the constitutional character of a corporation should be significant in the way in which the law relates to it. Dawson J said that the way in which the law operates upon constitutional corporations must be such that they impart their character to the law (346). Toohey J characterised the power as "plenary" and regarded the test enunciated by Gibbs CJ as focussing "too narrowly on the process of characterisation" (352). Corporations were identified as the subject matter of the power, but the question was whether there was a sufficient connection between the law and the subject matter to be able to say that the law is one with respect to that subject matter (353). The assessment of the sufficiency of the connection was to be qualitative (353). McHugh J also referred to the power as plenary but required that a law made pursuant to it have a relevance to, or connection with, a s 51(xx) corporation. It is not enough that the law refer to the subject matter or apply to the subject matter (368). It must have "some significance for the activities, functions, relationships or business of the corporation" (369). And if, by reference to the activities or functions of s 51(xx) corporations, a law regulates the conduct of those, inter alia, who work for the corporations it is unlikely that any further facts would be needed to bring the law within the reach of s 51(xx) (369). 37 Mason CJ, Gaudron and Deane JJ dissented in the result. Mason CJ again expressly rejected the proposition that the corporations power is confined in its application to the trading activities of trading corporations and the financial activities of financial corporations: it is a plenary power (333-334). Gaudron J, with whom Deane J agreed, described it in like terms as a plenary power "… to be construed according to its terms and not by reference to implications or limitations which those terms do not require" (364). She did not define the outer limits of the power but held that it extends so that "… at the very least, a law which is expressed to operate on or by reference to the business functions, activities or relationships of constitutional corporations is a law with respect to those corporations" (364). And once it is accepted that s 51(xx) extends to the business functions, activities and relationships of constitutional corporations it follows that "… it also extends to the persons by and through whom they carry out those functions and activities and with whom they enter into those relationships" (365). 38 The case law was recently reviewed by Cooper J in Rowe v Transport Workers' Union of Australia (1998) 90 FCR 95. His Honour held valid provisions of the Workplace Relations Act imposing penalties for certain classes of industrial action. He held it to be sufficient for validity that the law in question "in its legal and practical operation operates on or by reference to the business functions, activities and relationships of a constitutional corporation" (105). The sections in issue in that case were seen as protecting constitutional corporations from adverse effects to themselves and to their activities, functions, relationships or business consequent upon conduct taken against their employees or independent contractors in that capacity (106). 39 It is neither possible nor necessary for the purposes of this case to extract from these authorities an exhaustive statement of the limits of the corporations power. It is sufficient to say that the state of the law after Dingjan supports, as a valid exercise of the corporations power, a law that applies expressly and specifically to constitutional corporations in their capacity as such corporations or to other persons or bodies in their dealings with such corporation or their conduct in relation to them. A fortiori a law is a valid exercise of the power under s 51(xx) if it confers rights or powers or imposes duties or liabilities peculiarly on such corporations or those who deal with them or engage in conduct affecting them in connection with those dealings or that conduct. It may be accepted that a law of general application which happens to apply to constitutional corporations among others is not a law with respect to such corporations for the purposes of s 51(xx).

Whether Part VIB is Supported by the Corporations Power 40 Division 2 of Part VIB deals specifically with agreements involving constitutional corporations as defined in s 4(1) of the Workplace Relations Act. It is not a law of general application but one specifically directed to the subject matter of the power. Its provisions give binding effect to agreements made between such corporations and organisations of employees where such agreements are certified by the Commission. They also purport to bind by such agreements all persons whose employment is, at any time when the agreement is in operation, subject to the agreement. The laws create rights and liabilities between the constitutional corporations to which they apply, the organisations of employees with whom they conclude certified agreements and the employees to whom the agreements apply. The nature of the agreements is defined in s 170LI which describes them as agreements: "… about matters pertaining to the relationship between … an employer who is a constitutional corporation and … all persons who, at any time when the agreement is in operation, are employed in a single business or a part of a single business of the employer and whose employment is subject to the agreement." These elements, made essential by s 170LI, are sufficient to indicate that the impugned laws apply directly to constitutional corporations in that character and to their employees. If satisfaction of a discrimination test as enunciated by Brennan J can be regarded as at least sufficient to determine validity then these laws are valid on that basis. They are also valid if the test applied is that of "sufficient connection". The rights and duties which define the relationship between a corporation and its employees are central to its functioning. It is true that employee relations are not peculiar to constitutional corporations, but neither are trading or financial activities. The fact that the subject of the law is not itself unique does not deprive it of the character of a law with respect to constitutional corporations if it is specifically and uniquely directed to them. That direction is no mere peg or reference point. The constitutional corporation in Part VIB is a necessary party to the agreement for which that Part provides and a necessary repository of the rights and duties which they define. The provisions of Part VIB are therefore a valid exercise of the power.

Trading or Financial Corporation - Criteria for Identification 41 The criteria for identifying a corporate entity as a trading or financial corporation have evolved out of a contest between narrow and more expansive approaches adopted by Justices of the High Court, generally reflecting like approaches to Commonwealth power and the scope of federal jurisdiction. There was little authority on the question before the decision of the Court in the St George County Council case. Quick and Garran, in the Annotated Constitution of the Australian Commonwealth (1901 Legal Books repr) p 606 said that a trading corporation was "one formed for the purpose of carrying on trade". "Financial corporation" was seen as referring to all "financial institutions" formed within the limits of the Commonwealth including "companies which received deposits of money for investment and make advances on the security of land, such as land-mortgage companies and building societies" (607). The nature of the corporations to which the power applies was not the subject of extensive exposition in Huddart Parker. Isaacs J would have treated as outside the range of federal power "all those domestic corporations, for instance, which are constituted for municipal, mining, manufacturing, religious, scholastic, charitable, scientific, and literary purposes, and possibly others more nearly approximating a character of trading…" (393). 42 In Strickland v Rocla Concrete Pipes, Barwick CJ upheld the validity of provisions of the Australian Industries Preservation Act as laws which "…dealt with the very heart of the purpose for which the corporation was formed, for whether a trading or financial corporation, by assumption, its purpose is to trade, trade for constitutional purposes not being limited to dealings in goods" (489). The implication seems to have been that the purpose for which a body corporate was formed was significant in its characterisation. This did not, however, reflect his Honour's position in later judgments. 43 The purpose of formation figured prominently in the judgments of two of the majority Justices, Menzies and Gibbs JJ, in the St George County Council case. In that case a local authority which engaged in the supply of electricity was held not to be a trading corporation within s 5 of the Restrictive Trade Practices Act 1971 (Cth). The Act adopted the class description from s 51(xx) of the Constitution in its definition of the corporations to which it applied. McTiernan J, who was the other member of the majority, focussed upon the legislative intention which he saw as directed to "a free enterprise corporation". He did not in terms address the scope of the class for the purposes of pl (xx). Menzies J had regard for the purpose for which the Council was formed as indicating "both its original and existing character" (551). It was "… a corporation for local government purposes which has defined trading powers" (552). That a corporation trades was seen as insufficient to bring it within the character of a trading corporation: "A university may trade - its bookshop is an example of this - but if incorporated it is not because of its trading within the classification of a trading corporation." (553) A like approach was taken by Gibbs J, The word "trading", he said "forms part of a composite expression which indicates the essential attributes of the kind of corporation to which it refers" (561). A trading corporation was one "formed for the purpose of trading" (562). Barwick CJ and Stephen J dissented, taking the view that the term "trading corporation" referred not to the purpose of incorporation but to the activities of the corporation at the relevant time (561 Barwick CJ and 568 Stephen J). Both accepted that not every corporation, which to any extent engages in trade, is a trading corporation (543 and 572). A corporation whose predominant and characteristic activity is trade will satisfy the description (543). 44 No clear majority view of the scope of the class of trading corporation emerged from St George County Council,having regard to the way in which McTiernan J treated the case as one of statutory rather than constitutional interpretation. In any event, the approach of the dissenters was vindicated in The Queen v Federal Court of Australia Ex parte; Western Australian National Football League (1979) 143 CLR 190 ("the Football Club case). The majority, comprising Barwick CJ, Mason, Jacobs and Murphy JJ, held that a corporation is a trading corporation if trading is a substantial or significant part of its corporate activities (208 Barwick CJ, 233 Mason J, Jacobs J agreeing at 237 and 239 Murphy J). On this test substantial trading activity is a sufficient condition for characterisation of a corporation as a trading corporation regardless of the purpose for which it was formed. Trading must be, of course, within the corporation's legal capacity (208). And trading which is a peripheral part of a corporation's activities will not suffice to lend it the character of a trading corporation (208, 234 and 239). 45 The same approach was taken to the characterisation of financial corporations in State Superannuation Board v Trade Practices Commission (1982) 150 CLR 282. In the joint majority judgment Mason, Murphy and Deane JJ said that "… the Court's approach to the ascertainment of what constitutes a "financial corporation" should be the same as its approach to what constitutes a "trading corporation", subject to making due allowance for the difference between "trading" and "financial"." (303) Moreover the two classes were not to be seen as mutually exclusive. A corporation could be a financial as well as a trading corporation (303). The majority position in the Football Club case was restated and summarised thus: "…it was essential to the majority's approach and to its rejection of St George that a corporation whose trading activities take place so that it may carry out its primary or dominant undertaking, eg, as a sporting club, may nevertheless be a trading corporation". (304) There was nothing in the Football Club case to lend support to the view that a corporation carrying on independent trading activities on a significant scale will not be properly categorised as a trading corporation if other more extensive non-trading activities properly warrant its being also categorised as a corporation of some other type (304). The term "financial corporation" does no more than "describe a corporation which engages in financial activities or perhaps is intended so to do" (305). Just as a corporation could be a trading corporation although its trading activities are entered into in the course of carrying on some primary or dominant undertaking, so too a corporation engaged in financial activities in the course of carrying on its primary or dominant undertaking can be a financial corporation (305). The "activity" test so called establishes a sufficient condition for description of a corporation as a trading or financial corporation. But activities are not the only way in which the categorisation may be made. Absent activity, other indicia may be invoked such as the constitution of a corporation which has not begun to carry on business - Fencott v Muller (1983) 152 CLR 570 at 602. 46 The Tasmanian Dam case required consideration of the nature of a statutory authority, the Hydro-Electric Commission, and whether it was within the reach of pl (xx). The character of the body corporate as a statutory authority of a State was held not to take it outside the class of constitutional corporation (155 Mason J). Its trading activities being a substantial part of its overall activities, it was held to be a trading corporation (156 Mason J, 179 Murphy J, 240 Brennan J and 293 Deane J). See also E v Australian Red Cross Society (1991) 27 FCR 310 in which the Australian Red Cross Society and the Royal Prince Alfred Hospital were held to be trading corporations. 47 Relevantly for the present case, the University of Western Australia will be a trading corporation for the purpose of pl (xx) and therefore a constitutional corporation to which the Workplace Relations Act applies if it engages in substantial or significant trading activities notwithstanding that trading is not its primary purpose. The same consideration applies to its characterisation, which is not mutually exclusive, as a financial corporation.

Whether the University of Western Australia is a Trading or Financial Corporation? 48 Dr Quickenden's submission on whether the University is a trading or financial corporation began by accepting that the question depended largely but not exclusively upon an identification of its activities in order to determine whether trading forms a significant or substantial part of them. The traditional role of a university in undertaking educational and research activities would not appear to be within the conventional concept of "trading" even when those services are provided for a fee at or near their commercial cost. Income from research grants and contracts, it was said, should be segregated. Income from grants and research should not be classified as derived from trading. Income from consulting and research activities undertaken for industry would fall within that category. Reference to the consolidated accounts to review the nature of the trading activities of the University concealed the real nature and origin of the income rather than elucidating it. There was said to have been an absence or failure of proof on this vital issue. 49 The University pointed to various trading activities in which it engages including the buying, selling and renting of property and investing. From these activities it was said to have derived $44.393 million in 1995 and $48.048 million in 1996. Its investment income represented 16.83% and 16.97% of total operating revenues for those two years respectively. Other business activities relied upon were the Festival of Perth, the sale of publications and services, parking, provision of student accommodation and the provision of services through Winthrop Technology. Each of these activities was carried out by the University and not by a separate entity owned or controlled by it. 50 The University also submitted that the fees charged by it for courses are fees for services notwithstanding that they are regulated by legislation and ministerial guidelines. So it was said that under the Higher Education Funding Act 1988 (Cth) the regulation of fees is a condition of receiving Commonwealth grants and not a requirement imposed directly by law. The guidelines themselves, it is said, do not limit the University in such a way as to deny the fees the character of payment for services and facilities provided in the courses offered by the University. No limits are imposed on the number or content of the courses nor on their promotion or design, nor on ancillary matters such as accommodation and other student benefits which may attract potential students. Specifically, in respect of payments made by the Commonwealth to the University under the Higher Education Funding Act it is said that they should properly be characterised as revenue from trading activities. The argument is put thus. Some students pay HECS contributions directly to the University. That is, they pay a fee for services rendered to them. In 1995 fees paid in this way amounted to $8.849 million. HECS payments by the Commonwealth to the University in that year amounted to $17.318 million. Those payments, it was submitted, should also be characterised as revenue derived from trading. 51 It is questionable whether the provision of educational services within the statutory framework of the Higher Education Funding Act amounts to trading. The Act creates a liability for each student to the University in respect of each course of study undertaken in a semester. The amount is not fixed by the University but rather by the Minister under published guidelines. The concept of "trading" is a broad one. It is doubtful, however, that it extends to the provision of services under a statutory obligation to fix a fee determined by law and the liability for which, on the part of the student, appears to be statutory. For present purposes, however, this aspect of the claimed trading activities can be disregarded. For it is plain that the other activities cited are trading activities and are a substantial, in the sense of non-trivial, element albeit not the predominant element of what the University does. The University was not established for the purpose of trading and at another time, closer to the time of its creation, it may not have been possible to describe it as a trading corporation. But at the time relevant to this case and at present, it does fall within that class. 52 It may be added that the characterisation of a body corporate as a trading corporation is a matter of fact and degree. Dr Quickenden has been unable to point to any error in that assessment on the part of the learned primary judge. As to the status of the University as a financial corporation that too is established on the evidence. His Honour's reasons and findings in that respect also are not shown to have been in error.

Acquisition of Property on Just Terms - The Basic Contentions 53 On the hypothesis that the relevant provisions of Part VIB are supported by s 51(xx) of the Constitution and that the University is a constitutional corporation to which they apply, Dr Quickenden contended that the certification of the agreement infringed the constitutional guarantee, embodied in s 51(xxxi), that any statutory acquisition of property must be on just terms. The basis for this contention was that the agreement replaced and overrode pre-existing mutual contractual rights and duties existing between him and the University under his long standing contract of employment. 54 Dr Quickenden says he has pre-existing contractual rights originating in the direct agreement between himself and the University. They are common law rights quite independent in origin of any federal statute. The rights so conferred constitute a valuable chose in action and a species of property. They are said to be displaced entirely by the certified agreement which "as an effective Commonwealth law, necessarily displaces all vestiges of the former contractual rights and obligations between those two". It if be that the common law rights are not displaced but attenuated, that attenuation is an erosion of the property rights and to that extent an acquisition of property. 55 A difficulty in the way of the submission lay in identifying the detail of the claimed adverse effects of the certified agreement. What was pointed to in argument was the alleged imposition under the certified agreement of performance review requirements which did not previously exist, the alleged extinguishment of contractual rights and the substitution of the agreement for them and the fact that Dr Quickenden would be subject, for the first time, to such things as lock-outs by the University under provisions of the Act relating to protected action. 56 It is desirable to consider more closely the content of Dr Quickenden's contract with the University and the operation on it of the certified agreement. This is best seen by reference to the sequence of his appointments and their contractual and regulatory framework within the University.

The Contract and the Certified Agreement 57 Dr Quickenden was first employed by the University as a Senior Demonstrator in the Department of Physical and Inorganic Chemistry by letter dated 29 October 1970. His appointment commenced on 1 January 1971. The offer of appointment was made "…in terms of the Conditions of Appointment attached". The Conditions of Appointment were signed and the offer thereby accepted by Dr Quickenden on 25 November 1970. The conditions included a requirement that as a Senior Demonstrator he would work under the general direction of the Head of Department and would be required to perform such duties as the Head of Department might from time to time direct or any statute of the University might require (cl 1(ii)). He would be subject to the University Act, the Statutes and Regulations of the University and to any general directions issued from time to time by the Senate to the staff (cl 3(i)). He was also subject to dismissal from office or suspension if guilty of such misconduct as in the opinion of the Senate would render his continuance in office detrimental (cl 3(iv)). 58 Dr Quickenden's appointment was renewed for three years from 1 January 1974 by letter dated 29 June 1973, again on the Conditions of Appointment relating to Senior Demonstrators. On 23 November 1973, he was advanced into the higher segment of a Senior Tutor's salary range with effect from 1 January 1974. 59 On 22 July 1974, the Senate of the University approved regulations for tenure and dismissal conditions and procedures for academic staff. Under those regulations established academic positions of Senior Tutor, Senior Demonstrator and above could be filled by permanent, short-term or temporary appointments (reg 1). Permanent appointments fell into two classes namely, 'subject to review' and 'not subject to review'. A permanent appointment not subject to review meant an appointment to be held in a permanent capacity until retiring age, retirement on grounds of invalidity, resignation, dismissal or compulsory relinquishment because the post had become redundant. The conditions of a permanent appointment not subject to review could be varied upon the recommendation of the Vice-Chancellor to the Senate "…in very exceptional circumstances" (reg 5(1)). A procedure was specified for such cases (reg 5(2)). A permanent appointment subject to review was one for a specified period at the expiry of which it would normally be converted to a permanent appointment not subject to review (reg 6(1)). The regulations also provided for the dismissal of staff. No member of the academic staff could be dismissed "during the period of his employment" except for "gross inefficiency or major dereliction of duty in regard to the staff member's work" or "gross misbehaviour" (reg 11). Procedures for the investigation of complaints and the dismissal of staff were set out (regs 12-22). The tenure regulations remained unamended until December 1988. 60 On 1 September 1975, Dr Quickenden was designated as a Senior Tutor. This appointment was subject to the Conditions of Appointment for Senior Tutorships. They were similar in all relevant respects to the Conditions of Appointment for Demonstrators. 61 By resolution of the Senate on 12 December 1982, Dr Quickenden's status was increased from Senior Tutor to Lecturer with effect from 1 January 1983. This appointment was subject to Conditions Governing Permanent Appointments to the University. The conditions were applicable to Lecturers, Senior Lecturers and Associate Professors (cl 1). The University's evidence did not disclose the date on which those conditions were adopted. They were established indirectly by reference to a resolution passed to amend them in 1984. It is not in dispute, however, that they applied at all material times. Like the terms and conditions of Senior Demonstrators and Senior Tutors, they required the staff member to work under the general direction of the Head of Department (cl 2(ii)). A lecturer was appointed "… in terms of and subject to the regulations governing tenure and dismissal for academic staff … and unless otherwise stated in the formal offer of appointment will be appointed "permanent subject to review" for an initial period of three years from the date of commencing duties" (cl 5(i)). A lecturer would cease to hold office at the end of the year in which the age of sixty five years was attained (cl 5(ii)). Various provisions were made for salaries, superannuation (cl 6), study leave (cl 7), long service leave (cl 9), maternity leave (cl 10), special leave (cl 11) and private and consultative work (cl 13). 62 By resolution of the Senate on 25 November 1985, Dr Quickenden was made a Senior Lecturer with effect from 1 January 1986. It appears that by this time he had achieved the status of permanent appointment, not subject to review in the terms of the Tenure Regulations. 63 On 19 December 1988, the Senate resolved to amend the Tenure Regulations and the Academic Staff Conditions of Appointment. These amendments flowed from a four per cent second-tier salary increase granted by the Australian Conciliation and Arbitration Commission to academic staff employed under the Australian Universities Academics and Related Staff (Salaries) Award 1987. 64 The variation to the Tenure Regulations affected, inter alia, reg 5 relating to permanent appointments not subject to review and the procedure by which the Vice-Chancellor could take action to recommend to the Senate that the conditions of such an appointment be varied. The regulations relating to dismissal were also altered so that the conditions and procedures relating to suspension or termination were to be "…those determined from time to time by award or registered agreement pertaining to the staff member's employment under the appropriate Industrial Relations legislation" (reg 8). At the same time the Conditions of Appointment for Lecturers were varied to include, inter alia, a new clause 4 providing that: "A lecturer will be subject to the University Act, the Statutes and Regulations of the University and to any general directions issued from time to time by the Senate and to the terms of any award or registered agreement pertaining to the Lecturer's employment under the appropriate Industrial Relations legislation." 65 The affidavit evidence of the Vice-Chancellor asserted that the Tenure Regulations, as varied, provided, inter alia, that a lecturer would be subject to "the terms of any award or registered agreement pertaining to the Lecturer's employment under the appropriate Industrial Relations legislation". That is in fact a provision of the Conditions of Appointment as amended in 1988 and not of the Tenure Regulations. The learned primary judge found as a fact what was recited incorrectly in the Vice-Chancellor's affidavit (judgment par 71). No basis was demonstrated for the application of that amendment to the Conditions of Appointment applicable to Dr Quickenden's contract. The Tenure Regulations, however, were incorporated by reference in his Conditions of Appointment as a lecturer and in that respect his conditions were ambulatory. 66 The certified agreement which is challenged in these proceedings, is divided into Parts A to E and Schedules A to F. Parts A and B of the agreement deal with preliminaries (cls 1-8) and appointments/terminations (cls 9-12). Part C deals with Salaries, Salary Packaging and Additional Payments (cls 13-21). Part D deals with Leave (cls 22-28) and Part E with other provisions (cls 29-39). Part F comprises Schedules A to G providing details in relation to the Application of Awards, the Summary of Changes and Commitments given, Salaries and Additional Payments, Academic Staff Incremental Progression, Employees Eligible for Supported Salary, Procedures for the Settlement of Grievances and the Salary Packaging agreement. Clause 10 of the agreement, which deals primarily with appointment and termination contains subclause (f) which is complained of as a specific alteration of Dr Quickenden's common law rights. It provides: "(f) Employees will be subject to performance review conducted by the head of department or other supervisor nominated by the Vice-Chancellor which shall be separate from development reviews. Such performance reviews shall be conducted on a three yearly basis according to the procedures agreed between the parties." 67 As the University pointed out in its submission, the terms of the contract of employment were ambulatory in a number of important respects. It was subject to any general direction of the Senate to staff including resolutions of the Senate relating to the Tenure Regulations, public holidays and the taking of long service leave. The contract was variable according to Senate resolutions within the framework mentioned above. The Tenure Regulations, as amended in 1988, made the terms and conditions relating to suspension and termination those "…determined from time to time by award or registered agreement…". The latter reference is not limited to particular technical definitions of those terms in any specific Acts relating to industrial relations. Their generic meaning is evident from the reference in the amendment to the Regulations to "appropriate Industrial Relations Legislation". The term "registered agreement" encompasses an agreement which takes effect by reason of the operation of the Act whether or not the condition of its operation is registration of certification. The regulations which applied to Dr Quickenden by virtue of his terms and conditions of appointment as a lecturer therefore allowed for the possibility of an agreement such as that which is in issue in the present case. 68 In relation to the specific complaint that the performance review clause (10(f)) reflects a change in Dr Quickenden's contractual rights, the outcome of the process itself is not linked by the certified agreement to any right on the part of the University to reward or sanction its staff members. It may be that the information derived from such a review could inform the carrying out of procedures already in place for advancement, promotion, dismissal or suspension of a staff member. But that is not to say that the contractual rights of the member have thereby been altered. The University also submitted that there was, implicit in the requirement to comply with the general directions of the Head of Department, a requirement to comply with directions which might relate to review of performance. It is difficult to escape such an implication as a necessary incident of the role of the head in relation to staff. The right of the University under the contract of employment to terminate a staff member's employment for gross inefficiency or major dereliction of duty under the Tenure Regulations also necessarily attracts a requirement to assess performance. Reasonable directions to enable such assessment to be undertaken are a proper incident of that power and indeed indispensable to procedural fairness in its exercise. 69 The broad brush complaint that common law contractual rights were displaced by the certified agreement faced another threshold issue. For while the agreement bound Dr Quickenden by force of law, it did not thereby terminate his contract of employment. It created rights and obligations which were statutory in character and could operate in addition to the rights and obligations under his contact and, where inconsistent, no doubt displace them. There is nothing in the agreement however which expressly sets aside or displaces the terms of existing or common law rights generally. The agreement itself is not, on the face of it, and is not expressed to be, exhaustive of the rights and duties of those bound by it. If anything it focuses upon the rights of employees, rather than their obligations. 70 Having regard to the ambulatory nature of the terms and conditions of Dr Quickenden's contract with the University, the absence of any demonstrable specific detriment arising from the agreement, and its co-existence, subject to its terms, with the common law contract, there has been no acquisition of property. The certified agreement and the statutory provisions under which it was made are not therefore laws to which s 51(xxxi) applies.

Conclusion 71 For the preceding reasons the appeal is dismissed. On the question of the costs order below, his Honour's reasoning, which is set out in the judgment of Carr J, is correct and his order should not be disturbed. I certify that the preceding seventy one (71) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Chief Justice M Black and Justice R French.

ON APPEAL FROM A JUDGE OF THE FEDERAL COURT OF AUSTRALIA

AND: COMMISSIONER O'CONNOR OF THE AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

introduction 72 There are three issues in this appeal. The first is whether the learned primary judge erred when he held that the third respondent, the University of Western Australia ("the University"), is a trading corporation and a financial corporation. The second is, assuming that the University is a trading or financial corporation, whether his Honour was in error in holding that the provisions of Div 2 of Pt VIB of the Workplace Relations Act 1996 (Cth) ("the Act") and associated provisions are laws with respect to trading or financial corporations. I shall refer to them as "the challenged provisions". The third issue is whether the challenged provisions are ultra vires the Constitution because they purport to authorise the acquisition of the applicant's property on other than just terms. His Honour held that they were within power.

factual and procedural background 73 The appellant is a tenured senior lecturer at the University of Western Australia. He has never been a member of the second respondent, the National Tertiary Education Industry Union ("the Union"). On 10 March 1997 the University and the Union entered into an agreement known as "The University of Western Australia Academic, Academic Research and Related Staff Agreement 1997" ("the Agreement"). The Agreement, as its name might suggest, related to the terms and conditions of employment of academic staff at the University of Western Australia. It was expressed to apply to those members of the University's academic staff who were members or eligible to be members of the Union. The appellant has at all material times been eligible to be a member of the Union. 74 In April 1997 the University and the Union applied to the Australian Industrial Relations Commission under s 170LM (which is in Div 2 of Pt VIB of the Act) for the Commission to certify the Agreement. The appellant gave notice to the Commission that he objected to certification of the Agreement insofar as it purported to bind him as a member of the academic staff of the University eligible to be a member of the Union. He was given leave to intervene in the proceedings before the Commission. He submitted that the Agreement would have the effect of altering, without his consent, the terms and conditions of his employment with the University. In particular, he objected to a provision of the Agreement that employees of the University be subject to "performance reviews … conducted on a three (3) yearly basis according to the procedures agreed between (the University and the Union)", a provision that he argued was not a term of the contract of employment made between him and the University. 75 In June 1997 the Commission certified the Agreement. 76 On 18 December 1997 the appellant filed a notice of motion in the High Court of Australia seeking orders nisi; first, for the issue of a Writ of Certiorari to quash the Commission's decision to certify the Agreement, as a decision made without, or in excess of, jurisdiction, and secondly, for the issue of a Writ of Prohibition directing the Union and the University not to act upon the Commission's decision. 77 On 5 August 1998, by consent, the High Court ordered that the motion be remitted to this Court for determination. After such remittal, the Court directed the appellant to give notice to the Attorneys-General, pursuant to s 78B of the Judiciary Act 1903 (Cth), and also directed that the hearing of the motion be treated as the hearing of an application for orders absolute. In response to the notices given to the Attorneys-General, the Attorney-General of the Commonwealth intervened pursuant to s 78A of the Judiciary Act, on behalf of the Commonwealth both at first instance and at the hearing of this appeal. The Commission filed a submitting appearance.

The statutory background 78 The following description of the statutory background is taken largely from the reasons of the learned primary judge. 79 The object of Pt VIB is expressed as being "to facilitate the making, and certifying by the Commission, of certain agreements, particularly at the level of a single business". Parties to such an agreement, and the nature of the agreement able to be certified, are set out in Divs 2 and 3 of Pt VIB. 80 Division 2 of Pt VIB (ss 170LH - 170LM), headed "Making agreements with constitutional corporations or the Commonwealth", sets out the requirements that must be satisfied for an application to be made to the Commission to certify an agreement between an employer that is a constitutional corporation and an organisation of employees, or between such an employer and its employees. 81 Section 4(1) of the Act defines a "constitutional corporation" as, inter alia, a body corporate that is, for the purposes of s 51(xx) of the Constitution, a financial corporation or a trading corporation formed within the limits of the Commonwealth. 82 Section 170LI states that for an application to be made to the Commission under the Division there must be an agreement, in writing, about matters pertaining to the relationship between such an employer and all persons who, at any time when the agreement is in operation, are employed in a "single business", or part of a "single business" of the employer. 83 "Single business" is defined in s 170LB(1) of Div 1, Pt VIB as, inter alia, the activities carried on by a body, or other entity established for a public purpose by, or under, a law of a State. 84 The University is a body corporate established under s 6 of the University of Western Australia Act 1911 (WA). It was established under s 3 of that Act to provide "further instruction in those practical arts and liberal studies which are needed to advance the prosperity and welfare of the people" and to afford "special encouragement and assistance … [to] … those who may be hindered in the acquisition of sound knowledge and useful learning by lack of opportunity or means." The public purposes for which the University has been established are thus defined and the activities which constitute the "single business" of the University are the activities carried on by the University to effect that purpose. 85 Under s 170LJ(1) an employer may make an agreement with an organisation of employees. The Union is an organisation of employees registered under Pt IX of the Act. Section 170LJ(2) provides that the agreement must be approved by a "valid majority of the persons employed at the time whose employment will be subject to the agreement". 86 Section 170LE states that a "valid majority of persons employed at a particular time whose employment is or will be subject to an agreement" approves an agreement if the employer gives all of the persons so employed a reasonable opportunity to decide whether they want to give the approval and, if the decision is made by a vote, a majority of the persons who cast a valid vote decides to give that approval. 87 The Acting Vice-Chancellor of the University, in a statutory declaration in support of the application filed with the Commission, declared that the total number of employees "covered" by the Agreement was 1,528. He declared that the means used to ascertain whether "a valid majority of the persons employed at the time" approved the Agreement was a ballot. He also declared that ballot papers were distributed to "all academic staff" and that as at 8 April 1997, 469 votes received approved the Agreement and 26 votes opposed it. 88 The Act does not specify how a "vote" is to be conducted. The primary judge assumed, and it is not in issue, that the University complied with the requirements of s 170LE and, in particular, that "all academic staff" to whom ballot papers were distributed, were all of the persons, employed at the time, whose employment would be subject to the Agreement. 89 In Div 3 (ss 170LN - 170LS) certifiable agreements are those made, inter alia, to settle or prevent industrial disputes or to prevent "industrial situations" giving rise to industrial disputes. An "industrial situation" is defined in s 4(1) as "a situation that, if preventive action is not taken, may give rise to" an industrial dispute as defined in the Act. The definition of "industrial dispute" in s 4(1) includes a situation likely to give rise to an industrial dispute [emphasis added]. 90 Under Div 3, an agreement able to be certified is one made between the employer carrying on a single business and an organisation. It does not include an agreement between an employer and employees. The agreement must be approved by "a valid majority of employees" whose employment will be subject to the agreement. 91 Division 4 (ss 170LT - 170LW) sets out the requirements of an agreement able to be presented to the Commission to be certified, whether made under Div 2 or Div 3. One of the requirements of Div 4 is that the agreement must include procedures for settling disputes between the employer and the employees whose employment will be subject to the agreement, about matters arising under the agreement. 92 With the exception of ss 170M and 170MA in Div 6, the remainder of Pt VIB does not distinguish between a certified agreement made under Div 2 or Div 3. In particular, the provisions of Div 8 relating to the negotiation for certified agreements involving bargaining periods and "protected action" in the course thereof, apply equally to Div 2 and Div 3 agreements. Under s 170M(1) a certified agreement made under Div 2 "binds … all persons whose employment is … subject to the agreement". Section 170MA provides that a certified agreement made under Div 3 "binds … all members of the … organisation[-] … concerned". As the primary judge noted, s 170MA recognizes that under the conciliation and arbitration power, a certified agreement cannot be said to bind a person not a member of the organisation with which the agreement is made. However, s 170M provides that an agreement made between a constitutional corporation and an organisation will bind a person whose employment is subject to the agreement. Thus if an agreement provides that it applies to all relevant employees who are eligible to be members of the organisation (as the Agreement so provides in this matter) then, subject to the constitutional issues, s 170M operates so as to bind not only members of the organisation but also persons who are not members of the organisation. It is that provision which is at the core of the challenged provisions. 93 Under ss 170MN(1) and (2), 170ND and 170NF an employee whose employment is "subject" to the agreement, who engages in "industrial action" against the employer, is liable to the imposition of a penalty to a limit of $2,000. The primary judge observed (and I respectfully agree with him) that ascertaining who is an employee, whose employment is subject to the agreement, would be a matter of construction of the agreement.

The decision at first instance 94 It was common ground at first instance and it was assumed, but not decided, that the challenged provisions were not within the conciliation and arbitration power conferred by s 51(xxxv) of the Constitution. For the purposes of the motion, it was also assumed that if those provisions were not within the corporations power, they were beyond the legislative power of the Commonwealth. 95 His Honour, after reviewing the evidence and the authorities, found that the University's trading activities represented a substantial part of its operations and that it was a trading corporation. Although he noted that it was unnecessary to decide whether the University was also a financial corporation, his Honour expressed the view that it was a financial corporation. 96 The primary judge found that the challenged provisions delivered a benefit to a corporation. The benefit was the assurance from the Act that the corporation would be able to impose on all of its relevant employees, during the course of a certified agreement, adherence to the obligations in the agreement accepted by those employees who constituted the "valid majority" which either made the agreement or approved an agreement made with an organisation, notwithstanding that the "valid majority" might be a small minority of those employees whose employment were subject to the Agreement. His Honour applied tests explained by the High Court of Australia in Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 and held that the provision of such an unusual benefit to a corporation would supply the degree of connection between s 170M and constitutional corporations necessary to attract the corporations power. 97 His Honour then turned to the question whether the challenged provisions purported to authorise the acquisition of property on other than just terms. He assumed, for the purposes of the decision, that the appellant's contract of employment with the University provided valuable rights or interests capable of being regarded as "property" under s 51(xxxi) of the Constitution. The question was, as his Honour explained, whether the imposition, by the Agreement, of the terms relating to periodic performance review and the imposition of "mentoring" at the direction of the University resulted in it obtaining an interest in property by the operation of Pt VIB. His Honour found that at all material times the appellant's contract of employment with the University had been subject to the Tenure Regulations of the University which, in turn, (so his Honour found) provided that his employment was subject to the terms of any award or registered agreement pertaining to his employment under appropriate industrial relations legislation. There was no submission that anything turned on the Agreement being "certified" rather than "registered". His Honour held that the Tenure Regulations were ambulatory in nature and broad enough to include as part of the terms of the appellant's employment, the terms of an agreement certified under Pt VIB. 98 Although (given the conclusion immediately above) it was not strictly necessary for him to do so, his Honour then examined whether the challenged provisions could properly be characterised as a law with respect to the acquisition of property for a purpose in respect of which the Parliament has power to make laws. His Honour held that the challenged provisions were properly to be characterised as a law with respect to corporations by regulating their conduct rights and obligations. Incidental to that operation there might be an acquisition of property, but s 170M was not a law with respect to the acquisition of property of a person for the purposes of the corporations power. For those reasons, published on 10 September 1999, his Honour ordered, on that date, that the motion be dismissed.

trading or financial corporation 99 The appellant submitted that the primary judge had applied the wrong test in concluding that the University was a trading corporation. His Honour had, so it was put, based his conclusions on "… the fact of and the quantity of revenue generated by the University of Western Australia in its absolute context." The appellant submitted that it was not sufficient, in order to characterise the University as a trading or financial corporation, for it to engage in substantial trading or financial activities. It was necessary, so the appellant contended, to look at the whole of its activities when determining the character of the University. The answer was not to be found by reference to a "… mechanistic quantification of the revenue generated …". The appellant contended that those of the University's activities which could properly be described as trading or financial were all ancillary or a by-product of or incidental to the primary activities and the sole purpose and objective of the University which were said to be non-commercial, and non-trading in character. The appellant submitted that having regard to the purpose of the establishment of the University, both by reference to the University of Western Australia Act and how it conducted itself, how it saw its main activity and its actual activities, its trading activities were properly to be characterised as incidental, or a by-product, or ancillary. Revenue generation was one factor to be taken into account, but was not determinative. 100 On the question whether the University was a financial corporation, the appellant submitted that the primary judge had erred in his interpretation of what had been held by the High Court in State Superannuation Board v Trade Practices Commission (1982) 150 CLR 282. That case was not, so it was argued, authority for the proposition that it was sufficient to characterise a corporation as a financial corporation if it engaged to a substantial extent in financial activities. The appellant contended that it was also necessary for those activities to be commercial in nature and involve financial dealings with customers and the like.

my reasoning 101 I do not think that it would be useful to rehearse all of the relevant authorities. Although there are only five main High Court decisions on the question, it is difficult, as senior counsel for the appellant observed in oral argument, to extract from them a majority in favour of one test. However, I set out below the various strands of judicial guidance which, when wound together, facilitate the resolution of this issue. I shall refer to the principles relevant to characterisation of a corporation as a trading corporation, but they are equally applicable to the characterisation of a financial corporation: State Superannuation Board v Trade Practices Commission (1982) 150 CLR 282. 1. Once it is found that trading is a substantial and not merely a peripheral activity, not forbidden by the organic rules of a corporation, the conclusion that the corporation is a trading corporation is open - per Barwick CJ in The Queen v Federal Court of Australia; Ex parte W.A. National Football League (1979) 143 CLR 190 ("Adamson"). 2. A corporation may be a trading corporation even though trading is not its predominant activity: Adamson; State Superannuation Board; The Commonwealth v Tasmania (1983) 158 CLR 1 at 156. 3. In this context "trading" is not given a narrow interpretation. It extends, beyond buying and selling, to business activities carried on with a view to earning revenue and includes trade in services: Actors and Announcers Equity Association v Fontana Films Pty Ltd (1982) 150 CLR 169 at 184-185, 203; Adamson at 218, 235. 4. The description "trading corporation" is merited when the activities of a corporation form a sufficiently significant proportion of its overall activities: Adamson at 233. 5. The trading activities of a corporation may be so slight and so incidental as not to merit the description of it as a "trading corporation". Whether the trading activities are sufficient is very much a question of fact and degree: Mason J in Adamson at 234 (Jacobs J agreeing). 6. The activities test is not the sole criterion for determining the character of a corporation. Consideration has to be given both to current activities and to the intended purpose of a corporation: Fencott v Muller (1983) 152 CLR 570 at 588 and generally; Superannuation Board at 304-305. 7. It has not yet been decided whether trading is a substantial activity when measured in absolute dollar terms or whether substantiality is a relative term. Murphy J in Adamson (at 239) appears to have regarded substantiality as being an absolute rather than a relative concept. See also Wilcox J in E v Australian Red Cross Society & Ors (1991) 99 ALR 601 at 633 and 635. 102 His Honour reviewed the authorities, including those which I have mentioned above. He then, by reference to the Annual Reports of the University, and in particular the operating statement for the year ended 31 December 1997 [AB 453], identified eight individual sources of trading income. They ranged in size from $22.5 million of fees paid by students from overseas down to $0.8 million for parking fees. His Honour, conservatively in my opinion, took the net figure for the sale of land and property (including land developed for sale) of $2 million, whereas the evidence shows gross receipts from land and property sales of $68 million. His Honour did not express the total of those revenues as an absolute figure. The total for the year ended 31 December 1997 was $54.7 million. His Honour must have made this calculation, however, because he expressly noted that the net revenue obtained from these activities represented approximately 18% of the total operating revenues of the University in the 1997 year ($298 million). His Honour expressed his conclusion, on the basis of the extent of those trading activities, in these terms: "The hallmarks of a trading corporation, described in the authorities referred to above, are satisfied by the foregoing facts and for the purposes of the Act the University is a constitutional corporation." 103 I think that there is some merit in the appellant's submission that it may not be sufficient in the process of characterisation in a particular case, simply to make a mathematical calculation of the trading revenues generated by a corporation and compare that figure with the total of its receipts. However, that exercise would be consistent with cases such as Adamson and E v Australian Red Cross Society (1991) 99 ALR 601. 104 His Honour was well aware of the overall activities of the University - see for example paragraphs 12 and 40 of his reasons. It was common ground that the University's principal activities were teaching and research. 105 His Honour did not find that the remainder of the University's activities (i.e. those activities other than the trading and financial activities which he singled out for attention) were other than trading activities. As I see it, he simply referred to those which were obviously trading activities and, on the question whether the University was also a financial corporation, he referred to those activities of a financial nature which constituted a significant or substantial part of its overall activities. 106 Although it is not necessary for me to decide, in my view there were other aspects of the University's activities which could be characterised as trading. Judicial notice can, I think, be taken of the fact that these days universities compete for students. The competition may be more intense within a particular State, but it certainly extends overseas and probably extends interstate. The Higher Education Contribution Scheme, in essence, works as follows. Relevantly, if the University wishes to participate in the Scheme it is obliged to charge fees to the students for the provision of education. If a student elects to pay those fees to the University directly and immediately out of his or her own funds the student gets a discount of 25%, with the Commonwealth paying the balance to the University. Otherwise the student borrows the amount of the fees from the Commonwealth (which the Commonwealth pays to the University on the student's behalf) and subsequently repays that loan when he or she earns certain levels of income. The evidence was that the University derived, in the year ended 31 December 1997, an amount of $29.5 million under the Higher Education Contribution Scheme. I would regard that as being a trading activity. 107 There was evidence that the University provides services under contracts. The relevant item is described as "Other Research Grants & Contracts". The relevant amount was $32.365 million, but the contractual component is not isolated. 108 The appellant had the onus of proof. He could have chosen to adduce evidence to the effect that the character of the University was to be determined not simply by reference to the components of its total operating revenues. He did not do so. In those circumstances, it seems to me, consistent with the authorities, that one may regard the eight items shown in the University's operating statement under the heading "Operating Revenue" as a fair reflection of its activities. The Operating Revenue items sufficiently identify both the source of funds which enable its activities to take place and also the activities themselves. 109 His Honour held that the trading activities amounting (on his Honour's assessment) to 18% of the total operating revenues of the University in the 1997 year, represented a substantial part of the operation of the University. I think, with respect, he was quite right. I think that substantiality in this context, when measured in dollars, does not mean a large absolute figure. I think that it is a relative measure i.e. compared to the total income generated by the corporation. It is not necessary to decide the percentage point below which an amount becomes insubstantial. In Palser v Grinling [1948] AC 291 the House of Lords held that substantial was equivalent to considerable and that substantiality was a relative concept. See also Dowling v Dalgety Australia Ltd (1992) 34 FCR 109 at 138-139 and ASX Operations Pty Ltd v Pont Data Australia Pty Ltd (No 1) (1990) 27 FCR 460 at 478. Whether one has regard to his Honour's calculation of about 18% or my own assessment of at least 28% the trading activities of the University were substantial and formed a significant proportion of its overall activities. 110 I do not accept the appellant's contention that, in characterising the University as a financial corporation, his Honour erred either in law or fact. The evidence showed that in 1997 the University earned $29 million from investing funds in the short term money market and a further $19 million in buying short-term bills. His Honour found, and this was not challenged, that the principal part of the University's current assets was committed to such activities and that in 1997 approximately 5% of the total assets of the University were so employed. These activities, involving the loan of moneys to "outside" parties on a substantial scale, distinguish the present case from Ku-ring-gai Co-operative Building Society (No 12) Ltd (1978) 22 ALR 621 upon which the appellant relied for the proposition that financial activities had to be commercial in nature and involve financial dealings with customers and the like. 111 In my view, this ground of appeal has not been made out.

whether the challenged provisions fall within the corporations power 112 The appellant submitted that the scope of the corporations power was limited to the trading activities or financial activities of a corporation. He relied also on the dissenting judgment of Isaacs J in Huddart Parker & Co v Moorehead (1909) 8 CLR at 396 for the contention that the corporations power did not extend to regulation of the "internal" relationships of a constitutional corporation. Alternatively, the appellant submitted that the nature of the corporation must be significant as an element in the nature or character of the laws, if those laws were to be valid. There had to be something in the law being considered which was significant for a trading corporation in respect of what it did i.e. trade. There had to be some significant element, so it was contended, that linked the element of its trading activities and the law.

my reasoning 113 In my view, the authorities show that it is no longer necessary, in order to establish the constitutional validity of a law based on the corporations power, that such a law relate in some way to the trading activities of (relevantly in this case) a trading corporation. The question is to be answered by ascertaining whether there is a sufficient connection or some discriminatory application to corporations: Re Dingjan; Ex parte Wagner (1995) 183 CLR 323 and the authorities there discussed. In that case, at 364-365 Gaudron J said this: "When s 51(xx) is approached on the basis that it is to be construed according to its terms and not by reference to unnecessary implications and limitations, it is clear that, at the very least, a law which is expressed to operate on or by reference to the business functions, activities or relationships of constitutional corporations is a law with respect to those corporations. In this regard, it is sufficient to note that, although the business activities of trading and financial corporations may be more extensive than their trading or financial activities, those corporations nonetheless, take their character from their business activities [authorities cited]. ... It follows that the power conferred by s 51(xx) extends at the very least to the business functions and activities of constitutional corporations and to their business relationships. And those functions, activities and relationships will, in the ordinary course, involve individuals, and not merely individuals through whom the corporation acts, … or the control of whose conduct is directly connected with the regulation or protection of the corporation. Once it is accepted that s 51(xx) extends to the business functions activities and relationships of constitutional corporations, it follows that it also extends to the persons by and through whom they carry out those functions and activities and with whom they enter into those relationships." 114 Mason CJ and Deane J expressed similar views (see 334) and Deane J agreed with Gaudron J. I accept the submission put by senior counsel for the Commonwealth (intervening), that a law which regulates the industrial rights and obligations of trading and financial corporations, and persons employed by those corporations, clearly relates to the business activities and relationships of that corporation. Furthermore, as the primary judge held, (and I agree with him) the challenged provisions bind an employee to an agreement made by a constitutional corporation with an organisation of which the employee is not a member, or with a group of employees which did not include the employee. Those provisions may be seen to deliver a benefit to such a corporation in that, as his Honour pointed out, it obtains the assurance from the Act that it will be able to impose the terms of the Agreement on all relevant employees employed by it during the course of the agreement subject to acceptance by a "valid majority" of those employees. As his Honour noted, the "valid majority" may be a small minority of those employees whose employment is subject to the Agreement. 115 The challenged provisions can be seen to operate directly on a constitutional corporation in relation to its day-to-day employment relationships. In my opinion, the challenged provisions are quite clearly a law with respect to constitutional corporations. In this case, the fact that the University is a trading corporation has significance in the way in which the law relates to it (see Dawson J in Re Dingjan at 346). The challenged provisions only apply to trading corporations and they apply directly to confer a benefit. That, so it seems to me on the state of the authorities to date, provides a sufficient connection for the challenged provisions to be characterised as laws with respect to constitutional corporations. Once such a sufficient connection is shown, it would be irrelevant, in my opinion, whether or not the conduct sought to be regulated involved relationships internal to corporations. However, it is not necessary to decide that point, because in my opinion the relationship between a corporation and its employees should not be characterised as being "internal". When a corporation enters into a contract with an employee it can be seen to be operating in the employment market place. The terms of the contract may be negotiated solely between the corporation and the employee or, as in this case, an existing agreement may be varied by negotiations entered into by an organisation on behalf of the employees. The challenged provisions operate to bind those employees whose employment is subject to that agreement.

Acquisition of property on just terms 116 The appellant challenged both of the two bases upon which the primary judge rejected his contention that the challenged provisions, by displacing or eroding his common law rights, effected an acquisition otherwise than on just terms. The first basis was that the appellant's employment contract with the University was subject to the terms of any award or registered agreement. The second was that the challenged provisions were not a law with respect to acquisition of property but were properly to be characterised as a law with respect to corporations by regulating their conduct rights and obligations. Incidental to that operation there might be an acquisition of property, but the challenged provisions, so his Honour held, were not a law with respect to the acquisition of property of a person for the purpose of the corporations power.

my reasoning 117 The first of the two above bases for the primary judge's decision raises a contractual issue. 118 The initial contract pursuant to which the University employed Dr Quickenden was evidenced by a letter dated 29 October 1970 from the University to the appellant offering him employment as a senior demonstrator upon the terms and conditions contained in and referred to in that letter. The appellant accepted that offer on 25 November 1970. One of those conditions of appointment read: "A Senior Demonstrator will be subject to the University Act, and Statutes and Regulations of the University and to any general directions issued from time to time by the Senate to the staff." [AB 331, 333]. 119 On 22 July 1974 the Senate approved regulations for tenure and dismissal conditions and a dismissal procedure for academic staff ("the Tenure Regulations"). An examination of those regulations shows that they provide for what are described as "established academic posts" to be filled by a permanent appointment, a short-term appointment (normally 2 to 5 years) or a temporary appointment (normally for not more than 2 consecutive years). A permanent appointment was to be either subject to review or not subject to review. The expression "review" in this context can be seen not to have meant the sort of review, provided by the Agreement, to which the appellant takes exception, but a different sort of review. A permanent appointment not subject to review relevantly meant appointment in a permanent capacity until retirement, invalidity, resignation or dismissal or redundancy. A permanent appointment not subject to review also had to be one which carried study leave and pension rights. It seems to be common ground that the appellant held a permanent appointment not subject to review in that sense. Those regulations contained detailed provisions for dismissal. In brief, a staff member could not be dismissed except for gross inefficiency or major dereliction of duty in regard to his or her work, or gross misbehaviour, the commission or consequences of which constituted a serious impediment to the conduct of his or her work or that of his or her colleagues or students - see Regulation 11(1). Dismissal had to be in accordance with a detailed procedure for complaint, investigation of complaint and the like. The relevant regulations concerning dismissal were Regulations 11 to 17 inclusive. 120 On 13 December 1982 the University appointed the appellant to the post of lecturer with effect from 1 January 1983. On 25 November 1985 the Senate of the University resolved that the status of the appellant (among others) "be increased" from lecturer to senior lecturer with effect from 1 January 1986 [AB 379]. 121 There is no evidence of any change to the Tenure Regulations until 19 December 1988 on which date the Senate of the University exercised its powers under the University of Western Australia Act to amend the Tenure Regulations. 122 The amendments made some presently immaterial changes to the definition of permanent appointment subject to review. The most relevant amendments were as follows: "Part 2 - Dismissal (i) Delete the word "Dismissal" from the heading and substitute the words "suspension and termination". (ii) Delete regulations 11 to 17 inclusive and sub-headings and substitute the following as regulations 8 and 9 respectively: "8. The conditions and procedures under which a staff member's employment may be suspended or terminated shall be those determined from time to time by award or registered agreement pertaining to the staff member's employment under the appropriate Industrial Relations legislation. 9. A decision to dismiss a staff member for misconduct or unsatisfactory performance shall not take effect until ratified by the Senate." 123 There were consequential deletions from the regulations of provisions dealing with the procedure at hearings of complaints. 124 The positions of associate professor, senior lecturer and lecturer were subject to conditions set out in a document entitled "Conditions Governing Permanent Appointments to Lectureships" [AB 371-374]. Those conditions (which are to be distinguished from the regulations) relevantly provided that a lecturer · would work under the general direction of the Head of the Department, would be required to perform such duties as the Head of the Department might from time to time direct or any Statute of the University might require (paragraph 2); · would be subject to the University of Western Australia Act, the Statutes and regulations of the University and to any general directions issued from time to time by the University Senate to the staff; (paragraph 4) and · would be appointed in terms of and subject to the Tenure Regulations (paragraph 5). 125 Paragraph 4 was headed "Regulations and General Directions". 126 On the same date upon which the Senate amended the Tenure Regulations (19 December 1988) it amended the Conditions of Appointment for lecturers. The relevant portion of the Senate Resolution was as follows: "Paragraph 4 - Regulations and General Directions Delete this paragraph and substitute the following: A lecturer will be subject to the University Act, the Statutes and Regulations of the University and to any general directions issued from time to time by the Senate and to the terms of any award or registered agreement pertaining to the lecturer's employment under the appropriate Industrial Relations legislation." 127 I think that a comparison of the terms of the above amendment to the Conditions of Appointment with paragraph 71 of his Honour's reasons for judgment, shows that he was under the impression that the paragraph immediately above was an amendment to the Tenure Regulations. But the relevant amendment to the Tenure Regulations is set out at paragraph 50 above. It did not provide that the appellant's employment was to be subject to the terms of any award or registered agreement pertaining to his employment under appropriate industrial relations legislation. It provided that the conditions and procedures under which a staff member's employment may be suspended or terminated should be those determined from time to time by award or registered agreement pertaining to the staff member's employment under the appropriate Industrial Relations legislation. If his Honour was under this misconception, this was probably due to the way the case was conducted by the appellant at first instance and also the heading to that part of the resolution. 128 Professor Robson, in paragraph 45 of his affidavit [AB 242], declared that the Tenure Regulations, as varied, provided that a lecturer would be subject, among other things, to the terms of any award or registered agreement pertaining to the lecturer's employment under the appropriate Industrial Relations legislation. The person who drafted that paragraph of Professor Robson's statutory declaration thus contributed to his Honour's misapprehension. Professor Robson was not cross-examined on that point. The upshot of all this is, in my view, that immediately before the challenged provisions came into effect it was not technically correct to say that the appellant's employment conditions generally were subject to the terms of any award or registered agreement pertaining to his employment under appropriate Industrial Relations legislation. But, by virtue of the December 1988 amendments to the Tenure Regulations, the conditions and procedures under which his and any other lecturer's employment might be suspended or terminated were those determined from time to time by such award or registered agreement. 129 The detriment which the appellant identified as suffered by him by being bound by the Agreement comprised what was said to be the following: · the imposition upon him of performance review requirements; · the extinguishment of his contractual rights and the substitution of the terms of the Agreement for his common law contractual rights; and · exposure, for the first time, to such matters as lock-outs by his employer under the protected action provisions of the Act. 130 His Honour was of the view (see para 70 of his reasons) that if the provisions of the Agreement overrode the terms of the appellant's contract of employment, this would deprive the appellant of a right of action to sue in contract to prevent the imposition upon him of periodic performance review and mentoring at the direction of the University. This, so his Honour thought, would represent an adjustment of property amounting to an acquisition. 131 In my opinion, the question is one of degree. I appreciate that, to a member of the academic staff of a university, the question whether he or she is exposed to periodic review is no light matter. But it would appear that the review in the present case had no bearing on whether the appellant's employment would be continued or discontinued. It might, so we were told, have some bearing on additional discretionary payments or benefits. As the High Court of Australia explained in Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 420-421 an award imposes certain statutory terms and conditions which do not necessarily displace underlying common law contractual relations. If they conflict, the award or certified agreement may modify the contractual provisions, but otherwise they continue to co-exist. Bryne involved an award, but there does not seem to be any relevant distinction, for present purposes, between an award and a certified agreement. In my view, the appellant has not been able to identify a sufficient legal detriment and consequent benefit to the University as to constitute the acquisition of property. 132 If I am wrong in that conclusion, and there has occurred an acquisition of property, I consider that the challenged provisions fall into the category of laws to which s 51(xxxi) does not apply, because they are a law concerned with the adjustment of competing rights, claims or obligations of persons in a particular relationship or area of activity. The challenged provisions are relevantly directed at promoting industrial harmony in the workforce in which trading corporations and financial corporations operate. Any acquisition of property would be incidental to the adjustment of the competing claims of the respective corporations and employees. The challenged provisions are part of a scheme which provides for negotiation (usually involving an exchange of concessions) followed by a ballot decided by a majority of those who vote. The whole essence of that process is the adjustment of competing rights. The authorities which hold that s 51(xxxi) does not apply to such a law include Nintendo Co Ltd v Centronics Systems Pty Ltd (1994) 181 CLR 134 at 161 and Air Services Australia v Canadian Airlines International Ltd (1997) 167 ALR 392.

costs 133 In a separate judgment, delivered on 19 October 1999, his Honour ordered that costs should follow the event, i.e. that the appellant pay the costs of the Union and the University. We were told by counsel for the Union that it had not claimed costs at first instance, although counsel implicitly foreshadowed such an application in respect of the appeal. 134 His Honour rejected the appellant's argument that s 347(1) of the Act applied and that there should be no order as to costs. 135 Section 347(1) of the Act reads as follows: "347(1) A party to a proceeding (including an appeal) in a matter arising under this Act (other than an application under section 170CP) shall not be ordered to pay costs incurred by any other party to the proceeding unless the first-mentioned party instituted the proceeding vexatiously or without reasonable cause." 136 The University did not submit that the proceeding at first instance had been instituted vexatiously or without reasonable cause. The sole issue was whether the proceeding at first instance was in a matter "arising under the Act". His Honour applied the principle explained in Re McJannet; Ex parte The Australian Workers' Union of Employees, Queensland (No 2) (1997) 189 CLR 654 at 656-657. His Honour's conclusion was expressed in the following terms: "In the instant case, the proceeding was in a matter in which the controversy to be resolved was whether the decision made by the Commission exceeded the authority able to be conferred on the Commission by the Parliament and whether the Union and the University should be directed not to act on that decision. No part of the applicant's case involved application for the enforcement of a right or duty brought into existence by the Act. To the contrary, the applicant sought to enforce another duty imposed on the Commission by law not to act in the absence of an authority lawfully conferred on it pursuant to a legislative power of the Parliament provided by the Constitution, and to enforce a derivative duty to like effect, imposed on the Union and the University. The order sought for the issue of Writs of Certiorari and Prohibition did not, in form or content, relate to the enforcement or any right or duty conferred or created by the Act and, therefore, s 347 of the Act has no application to the proceeding." 137 I agree, respectfully, with his Honour's conclusion and the reasons set out above.

Conclusion 138 For the foregoing reasons I would dismiss the appeal with costs. I certify that the preceding sixty-seven (67) numbered paragraphs are a true copy of the Reasons for Judgment of Justice Carr.

Counsel for the Appellant: Ms C J McLure QC with Mr P J Gethin

Solicitor for the Appellant: Patrick Gethin & Co Counsel for the First Respondent: No Appearance Solicitor for the First Respondent: Australian Government Solicitor

Counsel for the Second Respondent: Mr P W Johnston with Mr W J Ford

Solicitors for the Second Respondent: Messrs Dwyer Durack

Counsel for the Third Respondent Mr R L Le Miere QC with Mr D F Parker

Solicitor for the Third Respondent: Messrs Blake Dawson Waldron

Counsel for the Attorney-General of the Commonwealth, intervening: Mr H Burmester QC with Mr R D Farrell

Date of Hearing: 31 May, 1 June 2000

Date of Judgment: 23 March 2001