Smith Kline & French Laboratories (Aust) Ltd v The Commonwealth

High Court of Australia|1991-07-01|Before: McHugh JJ, Gummow J

High Court of Australia Mason C.J. Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ. Smith Kline & French Laboratories (Aust) Ltd v The Commonwealth [1991] HCA 43

ORDER Smith Kline & French Laboratories (Australia) Ltd v The Commonwealth Answer the questions reserved for the consideration of the Full Court as follows: Question 1: Whether s. 33(3) of the Federal Court of Australia Act 1976 Cth is invalid. Answer: No. Question 2: If the answer to Question 1 is No, whether the High Court in exercising its discretion to grant special leave pursuant to s. 33(3) of the Federal Court of Australia Act 1976 Cth must be constituted by the Chief Justice and the six Justices of the Court. Answer: No. Order that the plaintiffs pay the costs of the questions reserved. Demurrer of the third defendant allowed. Order that the plaintiffs pay the costs of the demurrer. Action dismissed with costs. Carson v John Fairfax & Sons Ltd (Receivers and Managers Appointed) Demurrer allowed. Action dismissed. Order that the plaintiff pay the defendant's costs of the demurrer and of the action. Objection to competency upheld. Appeal dismissed as incompetent. Order that the appellant pay the respondent's costs of the objection to competency and of the appeal. Carson v Slee Demurrer allowed. Action dismissed. Order that the plaintiff pay the defendants' costs of the demurrer and of the action. Objection to competency upheld. Appeal dismissed as incompetent. Order that the appellant pay the respondents' costs of the objection to competency and of the appeal.

The Court published the following written reasons for judgment: -

Nov. 14 Mason C.J., Brennan, Deane, Dawson, Toohey, Gaudron and McHugh JJ.

These three matters were heard together because they involved a challenge to the validity of statutory provisions requiring that no appeal shall be brought to this Court from a judgment of the Full Court of the Federal Court or a judgment of the Supreme Court of a State unless this Court grants special leave to appeal [1] . At the conclusion of argument the Chief Justice stated:

The determination of the questions argued today has consequences for applications for special leave to appeal presently pending in the Court. In view of that circumstance, having come to a clear and unanimous conclusion that the challenge to the validity of s. 35(2) of the Judiciary Act 1903 and s. 33(3) of the Federal Court of Australia Act 1976 must fail, the Court considers that it is appropriate to announce that conclusion now.

Implicit in what I have said is a rejection of the submission that the jurisdiction to grant or refuse special leave to appeal does not involve an exercise of judicial power. It follows that the argument last advanced by Mr. Ellicott Q.C. must also fail. We leave the making of formal orders and the delivery of reasons to a later date.

Federal Court of Australia Act 1976 Cth, s. 33(3) and Judiciary Act 1903 Cth, s. 35(2).

It is convenient to describe very briefly the nature of the three proceedings before dealing with the questions of validity.

Smith Kline & French Laboratories (Australia) Ltd v The Commonwealth

In this action the plaintiffs sought declarations that s. 33(3) of the Federal Court of Australia Act and s. 35(2) of the Judiciary Act are wholly invalid or invalid in so far as they purport to confer on this Court the power to grant special leave to appeal from judgments of a Full Court of the Federal Court. The plaintiffs also sought a declaration that they are entitled to appeal as of right from the judgments and orders of the Full Court of the Federal Court in two proceedings in that Court. In the first of the two proceedings, the plaintiffs sought against the second defendant in this Court, the Secretary to the Department of Community Services and Health: (a) injunctions to restrain use, without the first plaintiff's consent, by the second defendant in the evaluation of applications to import and market generic cimetidine, of confidential information and of a sample provided by the first plaintiff to the second defendant; and (b) declarations as to the invalidity of reg. 5e of the Customs (Prohibited Imports) Regulations (Cth). In the second proceedings in the Federal Court, the third defendant in this Court, Alphapharm Pty. Ltd., sought declarations that the second defendant was entitled to act in the way sought to be restrained in the first proceedings. The two proceedings were heard together by Gummow J. who dismissed the first proceedings and made declarations in the second proceedings in favour of Alphapharm Pty. Ltd. The plaintiffs appealed and, in each case, the Full Court of the Federal Court dismissed the appeal with costs. The plaintiffs claimed that the judgment of the Federal Court in each appeal was given or pronounced in proceedings in which the matter in issue amounted to or was of the value of $20,000 or upwards or involved directly or indirectly a claim, demand or question to or respecting property or a civil right amounting to the value of $20,000 or upwards. On the assumption that the claim is correct, the plaintiffs would have in each case an appeal as of right to this Court from the judgment of the Full Court of the Federal Court if s. 33(3) of the Federal Court of Australia Act and s. 35(2) of the Judiciary Act are invalid. That is because, under s. 33 of the Federal Court of Australia Act before its amendment in 1984, an appeal as of right lay in such a case.

In the course of interlocutory proceedings in this Court, Brennan J. directed that two questions be reserved for the consideration of the Full Court: (1) Whether s. 33(3) of the Federal Court of Australia Act is invalid. (2) If the answer to Question 1 is "No", whether the High Court in exercising its discretion to grant special leave pursuant to s. 33(3) of the Federal Court of Australia Act must be constituted by the Chief Justice and the six Justices of the Court.

The third defendant in the action in this Court has demurred on the grounds that s. 33(3) is valid, that the validity of s. 35(2) does not arise for decision in the action and that, if it does, the sub-section is valid. The first ground of the demurrer corresponds with the first question reserved by Brennan J. for the consideration of the Full Court.

Carson v John Fairfax & Sons Ltd (Receivers and Managers Appointed)

In these actions the plaintiff sought declarations as against John Fairfax & Sons Ltd. ("Fairfax") and as against Mr. John Slee and Fairfax that s. 35(2) of the Judiciary Act is invalid and, alternatively, that it is invalid in so far as it purports to confer on this Court the power to give special leave to appeal to this Court from judgments of the Court of Appeal of New South Wales. The plaintiff also sought a declaration that he is entitled to appeal as of right from the judgments and orders of the Court of Appeal in proceeding Nos CA40379/89 and CA40380/89. Those proceedings arose out of two actions brought by the plaintiff in the Supreme Court for damages for defamation in respect of an article written by Mr. Slee entitled "Dr. Rajski: a war on many fronts" published in The Sydney Morning Herald on 27 April 1987 and an article written by Mr. Slee entitled "The criminal phase of the Rajski case" published on 6 May 1988. The first action was brought against Fairfax, the second against Mr. Slee and Fairfax. The actions were consolidated and heard by Loveday J. and a jury of four. The jury returned verdicts for the plaintiff in both actions and awarded the plaintiff $200,000 damages in respect of the first publication and $400,000 in respect of the second publication. Loveday J. entered verdicts with interest in favour of the plaintiff. Fairfax and Mr. Slee appealed to the Court of Appeal against the orders made by Loveday J. The Court of Appeal by majority allowed the appeals, set aside the orders made by his Honour and in lieu thereof returned the proceedings to the Common Law Division of the Supreme Court for retrial limited to the assessment of damages. The Court ordered that the defendants pay the costs of the trial and that the plaintiff pay the defendants' costs of the appeals.

The plaintiff claimed that the judgment of the Court of Appeal was given or pronounced in proceedings in which the matter in issue exceeded £500 or $20,000. The reference to £500 relates to the pecuniary limit of £500 prescribed by the Imperial Order in Council of 13 November 1850 regulating appeals from the Supreme Court of New South Wales to the Privy Council immediately before the enactment of the Commonwealth of Australia Constitution Act 1900 Imp. By that Order in Council, to which we shall refer in more detail a little later, an appeal lay if the judgment was given or pronounced in proceedings in which the matter in issue exceeded £500. The plaintiff contended that the second paragraph of s. 73 of the Constitution confers on an appellant a right of appeal to the High Court in cases in which an appeal lay to the Privy Council immediately before the enactment of the Constitution. The reference to $20,000 relates to the provisions of the Judiciary Act before they were amended in 1984.

The defendants in both proceedings demurred on the grounds that s. 35(2) is valid and that, even if it is invalid, the matters are not ones in which appeals lay as of right to the Court since its establishment or to the Privy Council at the establishment of the Commonwealth or thereafter. The defendants have also filed a notice of objection to the competency of the plaintiff's appeal to this Court. The grounds of objection were that special leave to appeal has not been granted and that the matter is not one in which an appeal lay as of right to the Court at the establishment of the Commonwealth or thereafter.

The appellate jurisdiction of the High Court and the appeal to the Privy Council from the Supreme Court of New South Wales

The High Court shall have jurisdiction, with such exceptions and subject to such regulations as the Parliament prescribes, to hear and determine appeals from all judgments, decrees, orders, and sentences -

(i) Of any Justice or Justices exercising the original jurisdiction of the High Court:

(ii) Of any other federal court, or court exercising federal jurisdiction; or of the Supreme Court of any State, or of any other court of any State from which at the establishment of the Commonwealth an appeal lies to the Queen in Council:

(iii) Of the Inter-State Commission, but as to questions of law only:

and the judgment of the High Court in all such cases shall be final and conclusive.

But no exception or regulation prescribed by the Parliament shall prevent the High Court from hearing and determining any appeal from the Supreme Court of a State in any matter in which at the establishment of the Commonwealth an appeal lies from such Supreme Court to the Queen in Council.

Until the Parliament otherwise provides, the conditions of and restrictions on appeals to the Queen in Council from the Supreme Courts of the several States shall be applicable to appeals from them to the High Court.

At the establishment of the Commonwealth an appeal lay to the Privy Council from the Supreme Court of New South Wales, pursuant to the Australian Courts Act 1828 Imp (9 Geo. IV c. 83), s. 15 and the Order in Council of 13 November 1850, from any judgment, decree, order or sentence given or pronounced for or in respect of any sum or matter at issue above the amount or value of £500 sterling or involving directly or indirectly any claim, demand or question to or respecting property or any civil right amounting to or of the value of £500 sterling, such appeal being by grant of leave to appeal by the Supreme Court of New South Wales. In the case of an appeal from a final judgment, decree or order, the appeal was of right; in the case of an interlocutory order, the grant of leave was at the discretion of the Supreme Court. The Order in Council did not affect the prerogative power of Her Majesty to grant leave to appeal from any decision of a colonial court, which remained unimpaired.

Section 35(1) of the Judiciary Act, when initially enacted in 1903, provided that the appellate jurisdiction of the High Court should extend to judgments of the Supreme Court of a State, or of any other court of a State from which, at the establishment of the Commonwealth, an appeal lay to the Queen in Council, given or pronounced for or in respect of any sum or matter at issue amounting to or of the value of £300 or involving directly or indirectly any claim, demand, or question to or respecting any property or any civil right amounting to or of the value of £300 or affecting the status of any person under the laws relating to aliens, marriage, divorce, bankruptcy or insolvency. Such an appeal was of right unless the judgment was interlocutory, in which event an appeal could not be brought except by leave of the Supreme Court or the High Court. But, under the sub-section, an appeal also lay to the High Court from any judgment, whether final or interlocutory, with respect to which the High Court granted special leave to appeal [2] . Section 35(1) thus enabled an appeal to be brought to the High Court, either as of right or by leave, from every judgment, decree or order from which an appeal could be brought to the Privy Council under the Order in Council of 13 November 1850.

In 1955, s. 35(1) was amended by substituting the amount of £1,500 for £300 [3] . In 1966, on the change to decimal currency, the amount of $3,000 was substituted for £1,500 [4] . In 1973, s. 35(1) was amended by omitting the reference to the judgments of any other court of a State from which, at the establishment of the Commonwealth, an appeal lay to the Queen in Council [5] .

Act No. 35 of 1955 Cth, s. 2. 2. Act No. 93 of 1966 Cth, s. 3, Sched. 1. 3. Act No. 216 of 1973 Cth, s. 3, Sched. 1.

Pursuant to the Judiciary Amendment Act 1976 Cth [6] , s. 35 was repealed and a new s. 35 substituted. The new section, so far as it is relevant to this case, provided:

(1) The jurisdiction of the High Court to hear and determine appeals from -

(a) judgments of the Supreme Court of a State, whether given or pronounced in the exercise of federal jurisdiction or otherwise; or

(b) judgments of any other court of a State given or pronounced in the exercise of federal jurisdiction,

whether in civil or criminal matters, is subject to the exceptions and regulations prescribed by this section.

(2) Except as provided by the succeeding provisions of this section, an appeal shall not be brought from a judgment, whether final or interlocutory, referred to in sub-section (1) unless the High Court gives special leave to appeal.

(3) Subject to sub-section (4), an appeal may be brought as of right from a final judgment of a Full Court of the Supreme Court of a State given or pronounced -

(b) in any proceedings in which the matter in issue amounts to or is of the value of $20,000 or upwards or which involve directly or indirectly a claim, demand or question to or respecting any property or any civil right amounting to or of the value of $20,000 or upwards.

(4) An appeal shall not be brought from a judgment referred to in sub-section (3) on a ground that relates to the quantum of any damages in respect of death or personal injury unless the High Court has given special leave to appeal on that ground.

(6) Notwithstanding any other Act, an appeal may be brought as of right from a final judgment of a Full Court of the Supreme Court of a State where the ground of appeal, or one of the grounds of appeal, involves the interpretation of the Constitution.

The critical amendment to s. 35(2), the validity of which is challenged by the plaintiffs in the present proceedings, was made by s. 3(1) of the Judiciary Amendment Act (No 2) 1984 Cth. By that sub-section the word "An" was substituted for the words "Except as provided by the succeeding provisions of this section, an" and certain sub-sections were omitted, including sub-ss. (3), (4) and (6).

Section 33 of the Federal Court of Australia Act, as initially enacted, made similar provision for appeals to the High Court from judgments of the Federal Court as was then made by s. 35 of the Judiciary Act for appeals to the High Court from judgments of the Supreme Court of a State. There was, of course, no need to distinguish between judgments given in the exercise of federal jurisdiction and other judgments. Except as provided by another Act, no appeal lay to the High Court from a judgment of the Federal Court constituted by a single judge [7] Sub-sections (3) and (4) provided:

(3) Except as provided by the succeeding provisions of this section, an appeal shall not be brought from a judgment of a Full Court of the [Federal] Court unless the High Court gives special leave to appeal.

(4) Subject to sub-section (5), an appeal may be brought as of right from a final judgment of a Full Court of the [Federal] Court given or pronounced -

Sub-section (5) corresponded to s. 35(4) of the Judiciary Act. 1. s. 33(2).

By s. 3(1) of the Federal Court of Australia Amendment Act 1984 Cth, amendments were made to s. 33 so that it corresponded with s. 35 of the Judiciary Act as amended. The words "Except as otherwise provided by another Act" were substituted for the words "Except as provided by the succeeding provisions of this section" and sub-ss. (4) and (5) were omitted.

The plaintiffs' challenge to the validity of s. 35(2) of the Judiciary Act and s. 33(3) of the Federal Court of Australia Act rested on five submissions. They were: (1) the second paragraph of s. 73 of the Constitution prevents Parliament from enacting a law which deprives a litigant of his or her right of appeal to the High Court from a judgment of a Supreme Court of a State from which an appeal lay to the Privy Council at the establishment of the Commonwealth, the right of appeal to the High Court being conferred by the first paragraph of s. 73; (2) neither s. 35(2) nor s. 33(3) is an "exception" or "regulation" which it is within the power of Parliament to prescribe under the first paragraph of s. 73; (3) the two provisions, in so far as they purport to delegate to the Court the power to determine for itself what appeals it shall hear, are an abdication of legislative power; (4) the power conferred by the two provisions is not judicial power; and (5) if the power conferred is not judicial power, the jurisdiction to grant or refuse special leave to appeal in every case must be exercised by all the Justices of the Court.

Parliament's power to prescribe exceptions and regulations and the restraint upon that power imposed by the second paragraph of s. 73

The first submission made by Mr. Ellicott Q.C. for the plaintiffs assumed that the first paragraph of s. 73 confers an appeal as of right from a judgment of a Supreme Court and then asserted that the second paragraph prevents an exclusion or deprivation of that appeal as of right in those cases in which an appeal lay to the Privy Council at the establishment of the Commonwealth. The plaintiffs sought to find support for the submission in the notion that the High Court was established as an alternative court of appeal to the Privy Council, a notion said to be supported by the Australasian Federal Convention Debates and by authority.

The Convention Debates provide strong support for the view that the establishment of the High Court as a national court of appeal was not intended to supersede or exclude the appeal to the Privy Council from the Supreme Courts of the States. That sentiment on the part of at least some of the delegates was manifest in the Convention Debates. In conformity with that sentiment, the Constitution does not confine or restrict the right of appeal from the Supreme Courts of the States to the Privy Council. But it would be a mistake to say that the appeal to the High Court from the Supreme Court of a State for which s. 73 provided was seen merely as an alternative to the right of appeal to the Privy Council. The prevailing sentiment of the delegates, as expressed in the Convention Debates [8] , was that Australia should establish its own final court of appeal, just as the United States had established the Supreme Court of the United States, subject only to preserving the appeal to the Privy Council. Ultimately, s. 74 preserved the prerogative appeal by special leave from the High Court to the Privy Council, but that appeal was qualified by the necessity for a certificate in relation to constitutional "inter se" questions and was subject to the Parliament's power to make laws limiting the matters in which leave might be asked [9] .

See the remarks of Mr. Symon on 25 March 1897, pp. 130-131. 2. s. 74, third paragraph.

The Convention Debates do not support the plaintiffs' contention that the second paragraph of s. 73 was intended to ensure that a litigant would always have an appeal as of right to the High Court from a judgment of the Supreme Court of a State if, at the establishment of the Constitution, an appeal lay from that judgment to the Privy Council. The inclusion of the second paragraph of s. 73 arose out of a concern expressed by some delegates that the words "with such exceptions and subject to such regulations as the Parliament prescribes" in the first paragraph might enable Parliament to exclude appeals to the High Court to such a substantial extent as to leave it with a minimal appellate jurisdiction. Mr. Barton encapsulated this concern when, with reference to cl. 74 (as the draft of s. 73 was then numbered), he said [10] :

The difficulty about the clause as it stands is this: That it allows the Parliament to legislate in reference to the jurisdiction of the High Court in regard to appeals in such a way that, little by little, the High Court may become the mere shadow of a Court of Appeal. (Emphasis added.) A little later he went on to say [11] : What I object to is the retention of words which would enable Parliament so to cut down the jurisdiction of the High Court in appeal cases as to leave, in some cases, a person who has a right practically without any remedy by way of appeal. (Emphasis added.) Both Mr. Glynn and Mr. O'Connor expressed similar views [12] , Mr. Glynn making reference to attempts by Congress to exclude appeals to the Supreme Court of the United States. The concern of the delegates was not that the High Court might decline to hear appeals by refusing to grant leave or special leave in the exercise of power to do so conferred upon the Court by Parliament; the concern was that Parliament might itself by prescribing "exceptions" directly exclude appeals. The second paragraph was introduced with a view to confining the power of Parliament in this respect. 1. 4 March 1898, p. 1885. 2. ibid., p. 1886. 3. 31 January 1898, p. 331; 4 March 1898, pp. 1890, 1893; 11 March 1898, p. 2323.

The language of the paragraph confirms that this was its object. That language carefully reflects the language of the first paragraph - "no exception or regulation prescribed by the Parliament shall prevent the High Court from hearing and determining any appeal" of the designated class. The purpose of the paragraph was to ensure that Parliament could not, in the exercise of its legislative power to prescribe exceptions from the Court's appellate jurisdiction and regulations to which that jurisdiction was subject, prevent the Court from hearing and determining any such appeal. The paragraph imposes a restraint on the exercise of that legislative power so that Parliament cannot deprive the Court of jurisdiction to hear and determine such an appeal. The paragraph is not expressed in terms appropriate to confer on a litigant a right to appeal as of course, free from a requirement of the grant of leave or special leave to appeal, in any matter in which at the establishment of the Commonwealth an appeal lay to the Privy Council.

The words "exceptions" and "exception" are used in the first and second paragraphs in the sense of jurisdiction or matters excluded or taken away from the general grant of appellate jurisdiction conferred by the first paragraph. The words "regulations" and "regulation" signify "conditions" and "restrictions" that Parliament may prescribe, subject to which the appellate jurisdiction would be exercised. In other words, "regulation" in the second paragraph corresponds with the words "conditions" and "restrictions" in the third paragraph. In this respect the third paragraph is of particular significance because the existing "conditions of and restrictions on appeals to the Queen in Council" to which it refers include such requirements as pecuniary limitations, that the judgment appealed from be final rather than interlocutory and the grant of leave and special leave, imposed by Orders in Council in respect of Privy Council appeals. Equally, these requirements are "regulations" within the meaning of the first paragraph.

The third paragraph is significant in another respect. In accordance with the principle of constitutional interpretation which calls for a liberal reading of a grant of legislative power, the words "Until the Parliament otherwise provides" should be construed as conferring upon Parliament the power to prescribe such conditions and restrictions on appeals to the High Court from judgments of the Supreme Courts of the States as it sees fit, so long as it complies with the second paragraph of s. 73. There is, in our view, no reason for concluding that the exercise of the power is to be confined to prescribing conditions and restrictions which are not more onerous than those prescribed by the Orders in Council regulating appeals from the Supreme Court of a State at the establishment of the Commonwealth. If it were otherwise, there would be a considerable and inconvenient limitation on the legislative power arising from the differences in the conditions and restrictions applicable under the Orders in Council in their application to appeals from the various Supreme Courts of the States. The Parliament, if it wished to prescribe conditions and restrictions operating uniformly throughout the States, would be confined to the prescription of conditions and restrictions no more onerous than any of those applicable to an appeal from a Supreme Court of a State to the Privy Council. Such an unlikely result could not have been intended.

All that we have said so far with respect to s. 73 has the support of the unanimous and long-standing decision of this Court in Parkin v James [13] . In that case, the question arose whether an appeal lay as of right to the High Court from a final judgment of a single judge of the Supreme Court of Victoria in respect of a sum or matter at issue amounting to, or of a value of, £300. In a judgment read by Griffith C.J., the Court concluded that it did. It is important, for present purposes, to examine the reasoning which led the Court to that conclusion.

As has been seen, s. 73 of the Constitution confers jurisdiction upon the High Court, "with such exceptions and subject to such regulations as the Parliament prescribes, to hear and determine appeals from all judgments, decrees, orders, and sentences of the Supreme Court of any State ". The Court [14] rejected an argument that the term "the Supreme Court of any State" should be construed as meaning "the Court of ultimate appeal in the State, as distinguished from the Court actually designated by that name". The term "Supreme Court" is, their Honours held [15] , "used in the Constitution to designate the Courts which at the time of the establishment of the Commonwealth were known by that name". The effect of s. 73 is:

An appeal to the High Court is given from all judgments, decrees, orders and sentences of the Supreme Courts, but, until the Parliament otherwise provided, the existing conditions and restrictions on appeals to the Queen in Council were to be applicable to such appeals, while Parliament had power to make exceptions from the right of appeal, and to prescribe regulations as to its exercise, subject to the condition that the power of this Court to hear and determine an appeal, in any matter in which an appeal then lay to the Sovereign in Council, should not be denied. [15] That meant that the answer to the question whether an appeal lay as of right from the decision of a single judge exercising the jurisdiction of the Supreme Court of Victoria in Parkin v James depended upon the effect of the conditions and restrictions then applicable to such appeals. It was, therefore, "convenient" for the Court to consider three questions, namely, "(1) What was the law applicable to appeals from the Courts of a State to the Sovereign in Council at the time of the establishment of the Commonwealth? (2) What were the existing conditions of and restrictions on appeals from the Supreme Courts? and (3) What exceptions and regulations have been prescribed by the Parliament as to such appeals?" [16] 1. ibid., at pp. 329-330. 2. ibid., at p. 330. 3. ibid., at p. 330. 4. (1905) 2 C.L.R., at p. 330.

The Court pointed out [17] that the Judicial Committee Act 1844 Imp (7 & 8 Vic. c. 69), which amended Act 3 & 4 Wm. IV c. 41, extended the right of appeal to the Privy Council from courts of last resort in British colonies and possessions to other courts of justice within such colonies and possessions and went on to authorize the making of orders providing for the admission of such appeals, specifically stating that "such Order may be either general and extending to all Appeals to be brought or special and extending only to any Appeal to be brought in any particular Case". Under this statute it was the practice to make Orders in Council regulating all appeals from the Supreme Court of a colony or possession, containing specific restrictions as to the right of appeal and conditions as to its exercise and to make special orders giving leave to appeal in cases not falling within the general order applicable to the particular court [17] . The Court summarized the position in these terms [18] :

In all cases an appeal lay to the Sovereign in Council, but in all cases leave to appeal had to be obtained, either from the Court appealed from or from the Privy Council. The general Orders in Council prescribed the conditions on which the Court appealed from was bound to grant such leave, while in all other cases a special order for leave by the Sovereign in Council was necessary. In the result, some appeals lay to the Privy Council from the Supreme Courts of the States upon compliance with conditions prescribed by the relevant general Order in Council, and other appeals on compliance with the condition of obtaining special leave [19] . The cases in which special leave to appeal was required fell into two classes. The first was where the appeal was not from the court of last resort in the colony of possession, e.g., a decision of a single judge exercising the jurisdiction of the Supreme Court. The second was where the appeal was from such a court but did not fall within the general Order in Council, i.e., where the nature of the question involved in the decision or where the pecuniary value of the civil right in issue did not bring it within the Order in Council [20] . Accordingly, at the establishment of the Commonwealth, an appeal from a decision of a single judge exercising the jurisdiction of the Supreme Court lay to the Privy Council, but only pursuant to a grant of special leave. What then was the effect of any valid exception or regulation prescribed by the Parliament pursuant to s. 73? 1. ibid., at p. 331. 2. ibid., at p. 331. 3. ibid., at p. 332. 4. ibid., at p. 333. 5. ibid., at pp. 333-334.

Their Honours considered [21] that, viewed in the light of this practice which prevailed at the establishment of the Commonwealth, it was "clear" that the expression "an appeal lies" in sub-par. (ii) of the first paragraph of s. 73 did not mean "an appeal lies as of course (i.e., without special leave)" and that there was no valid reason consistent with the usual rules of interpretation of statutes for putting a different construction upon the same words in the second paragraph of the section. They went on to say [22] that Parliament's power to make exceptions was exercisable only in relation to the appeals mentioned in sub-pars (i) and (ii) of the first paragraph of s. 73 other than appeals from the Supreme Court of a State since all the last-mentioned appeals were protected by the second paragraph of s. 73. The word "exception" in s. 73 meant an absolute exception which was to be distinguished from "regulation" in the first two paragraphs, a term that was synonymous with "conditions" and "restrictions" in the third paragraph. With reference to "regulation", the Court observed [23] :

It is an apt word as applied to appeals under a right of appeal from which there could be no absolute exception, while the words "conditions and restrictions" were equally apt as applied to appeals regulated by the Order in Council, and the Statute of 7 & 8 Vic. Upon the Court's construction of s. 73, a requirement of special leave came within "regulation" and not "exception" or "prevention". Indeed, in speaking of the earlier practice as to appeals to the Privy Council, their Honours said [24] : In one sense, and we think the truer sense, every appeal lay as of right. In some cases it lay as of course upon compliance with conditions prescribed in advance by a general Order in Council, in others only on compliance with the condition of obtaining special leave. But every suitor was entitled as of right to ask the aid of the Sovereign in Council, which might be granted or withheld. 1. (1905) 2 C.L.R., at pp. 332-333. 2. ibid., at p. 334. 3. ibid., at p. 335. 4. ibid., at p. 333.

The Court concluded that the provisions of s. 35 of the Judiciary Act (as enacted in 1903), including the requirement of s. 35(1)(b) that special leave to appeal be obtained in any case where an appeal did not lie as of right pursuant to s. 35(1)(a), represented valid "regulation" (and not "exception" or "prevention") of appeals for the purposes of s. 73. It said [25] :

This section [i.e., s. 35] in one sense imposes restrictions upon appeals, but the restrictions are not absolute, since in all cases an appeal may be brought by leave of the High Court. The term "judgment" includes any judgment decree order or sentence (s. 2), words which must bear the same meaning as they bear in s. 73 of the Constitution. If the cases in which appeals might be brought had been rigidly limited to those enumerated in paragraph (a), the Judiciary Act would have offended against the concluding enactment of s. 73 of the Constitution, but paragraph (b) removes this difficulty. It follows that, by the combined operation of s. 73 of the Constitution and s. 35 of the Judiciary Act, an appeal lies to the High Court from every judgment of the Supreme Court of a State, subject to the regulations prescribed by the Parliament. One of these regulations is that except in the specified cases, 1, 2, and 3, and in the case of all interlocutory judgments, the leave of the High Court must be first obtained. (Emphasis added.) In other words, the Court held that s. 35 of the Judiciary Act had validly prescribed the conditions and restrictions on appeals to the High Court from the Supreme Court of a State in substitution for the conditions and restrictions which had originally been made applicable by the last paragraph of s. 73 of the Constitution. The Court's conclusion in that regard was the foundation of the actual decision that, pursuant to the combined operation of s. 73 and s. 35, an appeal lay as of right to the High Court from the decision of the court below which, as has been said, was a final judgment for or in respect of a sum or matter at issue amounting to, or of the value of, £300 (see Judiciary Act (as enacted in 1903), s. 35(1)(a)). In conformity with the reasoning of the Court in Parkin v James and the decision that s. 35 of the Judiciary Act validly prescribed, by way of regulation, "the conditions of and restrictions on" appeals to this Court from the Supreme Courts of the States, the Court has, in its more recent decisions, regarded a requirement of special leave as a "regulation" and not an "exception" or "prevention" for the purposes of s. 73 [26] . 1. (1905) 2 C.L.R., at p. 336. 2. See Moller v Roy (1975), 132 C.L.R. 622, at p. 633, per Gibbs J.; pp. 638-639, per Stephen J.; p. 639, per Mason J.; p. 640, per Jacobs J. (but cf. p. 625, per Barwick C.J.); Attorney-General (Cth) v Finch [No 2] (1984), 155 C.L.R. 107, at p. 115, per Gibbs C.J., Mason, Wilson and Dawson JJ.

The plaintiffs submitted that Parkin v James should not be followed, more particularly to the extent that it decided that the expression "an appeal lies" in the first and second paragraphs of s. 73 does not mean an appeal lies as of right in the sense of "as of course". In support of this submission, Mr. Ellicott pointed to subsequent statements in this Court which, he suggested, threw a shadow over Parkin v James. One such statement is to be found in Kamarooka Gold Mining Co NL v Kerr [27] where, in an application for special leave to appeal from the Court of Mines (Victoria), Griffith C.J. said [28] :

This application raises the difficult and important question whether s. 73 of the Constitution includes Courts from which an appeal only lies to the Privy Council by special leave. The Court refused the application without answering that question. In the light of the reasoning in Parkin v James, the statement is puzzling and evidently proceeds on a misunderstanding of what the case decided. 1. (1908) 6 C.L.R. 255. 2. ibid., at p. 256.

Much later, in Collins v Charles Marshall Pty Ltd [29] , where the validity of s. 31 of the Conciliation and Arbitration Act 1904 Cth was in question, the Court made certain comments about the second paragraph of s. 73 which did not reflect a complete appreciation of what Parkin v James decided, no doubt because that case was not cited in argument or mentioned in the judgments. Section 31(1) purported to provide for an appeal to the Court of Conciliation and Arbitration from a judgment or order of any other court in two classes of proceedings. Section 31(2) went on to provide:

Except as provided in the last preceding sub-section, there shall be no appeal from a judgment or order from which an appeal may be brought to the Court under that sub-section. The Court held that s. 31 was invalid on the ground that it conferred an appellate jurisdiction on the Court of Conciliation and Arbitration from State courts exercising State jurisdiction and on another ground which we need not mention. 1. (1955) 92 C.L.R. 529.

Dixon C.J., McTiernan, Williams, Webb, Fullagar and Kitto JJ. observed [30] :

In the next place sub-s. (2) cannot constitutionally operate to exclude from the appellate jurisdiction of this Court a judgment decree order or sentence of a Supreme Court of a State in a proceeding arising under the Conciliation and Arbitration Act or arising under an order or award or involving the interpretation of that Act or such an order or award, if the matter is one in which at the establishment of the Commonwealth an appeal lay from the Supreme Court to the Privy Council. For by s. 73 of the Constitution it is provided that no exception or regulation prescribed by the Parliament shall prevent the High Court from hearing and determining any appeal from the Supreme Court of a State in any matter in which at the establishment of the Commonwealth an appeal lies from such Supreme Court to the Queen in Council. If this means "lies as of right", such an appeal lay in effect in the case of every such Supreme Court, except that of Tasmania, where the judgment involved £500 or more. Subsequently, their Honours said, with reference to s. 73(ii) [31] : It may be assumed that when that provision speaks of a court from which an appeal lies to the Privy Council that means lies as of right. In the light of the reasoning in Parkin v James, that assumption cannot stand. 1. ibid., at p. 538. 2. (1955) 92 C.L.R., at p. 543.

Mr. Ellicott also relied upon statements in Cockle v Isaksen [32] which elucidated the suggestion made in Collins v Charles Marshall Pty Ltd [33] that the power in s. 73 to prescribe exceptions was limited. In Cockle v Isaksen, Dixon C.J., McTiernan and Kitto JJ. observed that the power in s. 73 to prescribe exceptions assumed a general rule and specified a particular case or description of case which would be subsumed under the general rule but which, "because it possesses special features or characteristics, is to be excluded from" the application of the general rule [34] . In other words, the power could not be exercised so as to destroy the general rule. Williams J. [35] considered that the Parliament could regulate appeals to this Court by providing that they could only be brought as of right within a prescribed time, though the power to except or regulate could not be exercised so as to destroy appeals altogether from the Supreme Court of a State. The observations made in Cockle v Isaksen, while restricting the power to prescribe exceptions, are not inconsistent with the interpretation of s. 73 which we favour; nor are they inconsistent with the reasoning in Parkin v James.

(1957) 99 C.L.R. 155. 2. (1955) 92 C.L.R., at p. 544, per Dixon C.J., McTiernan, Williams, Webb, Fullagar and Kitto JJ. 3. (1957) 99 C.L.R., at p. 165. 4. ibid., at pp. 171-172.

The point is that, in Cockle v Isaksen, the Court was concerned with the validity of s. 113(3) of the Conciliation and Arbitration Act which specifically provided that an appeal did not lie to this Court from a certain class of judgments, decrees, orders and sentences of a State court (not being a Supreme Court) or of a court of a Territory. The Court upheld the validity of the provision and was, in view of its nature, not concerned to deal with the second paragraph of s. 73. What is significant is that s. 113(3) deprived the Court of jurisdiction by denying any appeal at all in the class of judgments etc. to which it referred. Consequently, the discussion in the judgments centred upon the scope of the power to prescribe exceptions, a matter on which Parkin v James did not offer guidance. The scope of the power to regulate by imposing a grant of special leave as a condition of an appeal did not arise for consideration. Accordingly, there was no occasion for the Court to refer to Parkin v James.

Sections 35(2) and 33(3) are "regulations" within the meaning of s. 73 of the Constitution

Once the distinction between "exception" and "regulation" as earlier stated is accepted and the imposition of a requirement for the grant of special leave to appeal is seen as a condition of the appeal, thus constituting a "regulation" of the appeal to this Court, it follows that neither s. 35(2) nor s. 33(3) "prevents" this Court from hearing and determining any appeal which lies to the Court under s. 73. The Parliament does not prevent the Court from hearing and determining any appeal when, by its legislation, it requires the grant of special leave to appeal as a condition of the appeal. The Court is at liberty to hear and determine such appeals as it considers appropriate in accordance with the criteria or considerations relevant to the grant or refusal of special leave.

Neither s. 35(2) nor s. 33(3) is an abdication of legislative power

What we have already said is an answer to the plaintiffs' argument that the two provisions amounted to an invalid delegation by the Parliament of its legislative power to prescribe "exceptions". As already explained, Parliament exercised its legislative power to regulate appeals to this Court by imposing the requirement of the grant of special leave as a condition of an appeal. There was no exercise of the power to prescribe exceptions and no delegation of that power. The Court's function in granting or refusing special leave is not a legislative function, a matter to be discussed in a little more detail in the context of the plaintiffs' contention that the function is not an exercise of judicial power.

From time to time statements have been made which draw attention to the unusual character of an application for special leave to appeal [36] . Such an application has special features which distinguish it from most other legal proceedings. It is a long-established procedure which enables an appellate court to control in some measure or filter the volume of work requiring its attention. Ordinarily, it results in a decision which is not accompanied by reasons, or particularly by detailed reasons. It involves the exercise of a very wide discretion and that discretion includes a consideration of the question whether the question at issue in the case is of such public importance as to warrant the grant of special leave to appeal [37] . To that extent at least, the Court, in exercising its jurisdiction to grant or refuse special leave to appeal, gives greater emphasis to its public role in the evolution of the law than to the private rights or interests of the parties to the litigation [38] . Notwithstanding these special features, an application for special leave to appeal, like an application for leave to appeal, is an accepted and long-standing curial procedure in this country [39] . The procedure calls for a hearing, whether orally or on written materials, and a determination in the form of a curial order. If the application be refused, the order dismissing the application is the final curial act which brings the litigation between the parties to an end. An application for special leave to appeal therefore involves the exercise of judicial power.

See, e.g., Coulter v The Queen (1988), 164 C.L.R. 350, at p. 356, per Deane and Gaudron JJ.; p. 359, per Mason C.J., Wilson and Brennan JJ. 2. Judiciary Act, s. 35A. 3. Morris v The Queen (1987), 163 C.L.R. 454, at p. 475, per Dawson J. 4. See Coulter v The Queen (1988), 164 C.L.R., at p. 359, per Deane and Gaudron JJ.

That conclusion necessarily disposes of the plaintiffs' argument that all the Justices of the Court must participate in the disposition of an application for special leave to appeal. The argument depended upon the proposition that the determination of such an application does not involve an exercise of judicial power and is a function discharged by the Justices as personae designatae.

Smith Kline & French Laboratories (Australia) Ltd v The Commonwealth

Answer the questions reserved for the consideration of the Full Court as follows:

Question 1: Whether s. 33(3) of the Federal Court of Australia Act 1976 Cth is invalid.

Question 2: If the answer to Question 1 is "No", whether the High Court in exercising its discretion to grant special leave pursuant to s. 33(3) of the Federal Court of Australia Act 1976 Cth must be constituted by the Chief Justice and the six Justices of the Court.

Order that the plaintiffs pay the costs of the questions reserved.

Demurrer of the third defendant allowed. Order that the plaintiffs pay the costs of the demurrer.

Carson v John Fairfax & Sons Ltd (Receivers and Managers Appointed)

Order that the plaintiff pay the defendant's costs of the demurrer and of the action.

Objection to competency upheld. Appeal dismissed as incompetent.

Order that the appellant pay the respondent's costs of the objection to competency and of the appeal.

Order that the plaintiff pay the defendants' costs of the demurrer and of the action.

Objection to competency upheld. Appeal dismissed as incompetent.

Order that the appellant pay the respondents' costs of the objection to competency and of the appeal.

At a glance

Court

Decision date

Before

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Judgment (94 paragraphs)

Parties