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Wednesday, 5 April 2000
Page: 15300

Mr McCLELLAND (4:28 PM) —I indicate my appreciation to government members who assisted in my making this presentation at this point in time. The Jurisdiction of Courts Legislation Amendment Bill 2000 involves relatively complex legislation. It arises from a decision of the High Court of Australia in re Wakim. The High Court in that case struck down cross-vesting legislation in the area of the Corporations Law to the extent that the High Court held that the Federal Court could not exercise state jurisdiction. That has created complications not only in the area of the Corporations Law but also in a number of other areas where there have been cooperative schemes developed to overcome problems of constitutional limitations. I will go through some of those schemes that are addressed in the bill. Each of those schemes has in common a situation where the federal parliament will legislate as a model and the states will reciprocate by implementing their own legislation replicating that; or, indeed, there have been some models that have arisen from the states such as in respect of gas pipeline access.

Invariably these codes have as their enforcement mechanism, through either the judicial review process or actual enforcement of either prosecutions or general civil enforcement measures, the use of the Federal Court system. That is important because it has enabled the Federal Court system to develop a national expertise and of course apply uniform principles right across the nation as to how these codes operate. Regrettably, as a result of the High Court case, it will be necessary, in some instances, for the power to resolve back down to the state level or, as this mechanism in this bill proposes, to have a situation where for federal officers who have the job of administering and, in some instances, policing these schemes—even in respect of policing the operation of state legislation—this bill will create a situation where they will be deemed to be exercising special federal powers, even though they may be operating under the area of state law. Because they are officers of the Commonwealth, albeit in some instances operating under state law, they will then be amenable to the federal judicial review process. That is the underlying rationale of this bill: those two instances of resolving the power back to the states or clarifying that, when federal officers or officers of the Commonwealth are exercising powers either under the federal part of the scheme or the state part of the scheme, they will be effectively deemed to be exercising their role as federal officers and hence amenable to this federal jurisdiction.

Before going through the bill in detail, it is appropriate that I provide some background to the cross-vesting schemes. As members are aware, we have a federal system where the states have their own legal systems and, indeed, according to authorities before these cross-vesting schemes came into being, the states were effectively regarded as foreign jurisdictions one to the other. Even though they were administering justice on behalf of all Australians, matters relating to the transfer of jurisdiction and the interaction of jurisdiction which frequently arise in the federal system were dealt with according to principles of private international law. To think that in the one nation those complex arrangements prevailed in our legal system is quite disturbing, but fundamentally that is the underlying structure we have. It is to the credit of the Commonwealth and state legislatures of all political persuasions that they have adopted mechanisms to get around those arrangements.

Increasingly the state boundaries that we have are presenting an impedient to the development of national schemes, whether they be in the area of Corporations Law, trade practices law, even law enforcement or the delivery of natural resources, such as natural gas. Particularly in this era of globalisation, it is vitally important that we work together as a nation in these very important areas. In that context, the outcome of the decision in re Wakim was regrettable. I do not think it would have been intellectually dishonest for the court to have arrived at another conclusion, but again it is not for us to make the decisions of the High Court but really to react, in the legislative sense, to the outcome of those.

I think it is fair to say that one of the reasons that we are successful as a nation has been that, in recent years, we have developed these cooperative arrangements. If I could just go through the more significant ones, firstly, in respect of the area of administrative appeals, in 1976 the Fraser government established the Administrative Appeals Tribunal, which has been extremely successful in providing a means for Australians to seek redress in respect of both the merits and legality of administrative decisions—initially of course at a federal level—of federal public servants. That scheme has been so successful that many states adopted the legislation as state legislation and, in so doing, bestowed on the federal Administrative Appeals Tribunal the power to adjudicate in respect of state officers. That is a tribunal, not a court, so that would withstand Wakim. But the trouble is that the Administrative Appeals Tribunal itself is subject to the right of appeal to the Federal Court of Australia which cannot happen through Wakim. This is the reason why this bill will be necessary to confirm that officers of the Administrative Appeals Tribunal will be exercising their office, even in considering state legislation, as officers of the Commonwealth. Similarly, the Administrative Decisions (Judicial Review) Act, which provides a more formal context for review of administrative decisions before the Federal Court of Australia, has also been extremely successful, but the very nature of the reviews being in the Federal Court of Australia means that review of state matters arising under state legislation cannot occur.

Then we move into a particularly topical area with the Olympics coming, and that is in respect of the Australian Sports Drug Agency Act. That establishes the Australian Sports Drug Agency as a Commonwealth statutory authority which primarily focuses on the conduct of comprehensive drug testing in competitive sport. There are various state acts which form part of this drug testing code and they in turn refer enforcement powers to various federal tribunals, including the Federal Court of Australia. To get around that situation, this bill proposes to invest the ability of judges and officers of the Federal Court to review aspects of the legislation but acting in their private capacity.

The next major area is vitally important to the economic wellbeing of this country—the Corporations Law. This is the most commonly discussed issue in the media because of the economic significance of it. The Corporations Law is a system of uniform national laws—again federal and state models replicating each other—to achieve uniform national corporations legislation. Each of the states has conferred their enforcement powers in the federal area, both with respect to administrative judicial review and with respect to the operation of the Federal Court of Australia. Again, that legislation needs to be now repaired as a result of the re Wakim decision, again by this mechanism of clarifying that when federal office holders exercise power even under state legislation they are nonetheless operating as federal officers and hence amenable to federal jurisdiction.

But the paradox of re Wakim, as it has construed our Constitution, is that whereas the federal parliament can invest state courts with federal legislation the reverse cannot occur. So what is occurring in this bill is that administrative judicial review proceedings will be also divested back to the state systems. So, again, it is going to be a partial solution but only a partial solution because there will still be many non ADJR matters which will arise in the state arena which cannot be dealt with at a federal level. Indeed, since Wakim we have seen a significant reduction in the number of Federal Court cases considering these Corporations Law problems. That is a real problem. Just evidencing the significant role of the Federal Court, in a recent report of the Australian Law Reform Commission on Australia's federal justice system, handed down in January 2000, the commission commented:

Australia's legal system plays a crucial role in the nation's economy, with law and legal services a key export and effective dispute resolution a selling point to the international community. The independence, integrity and quality of the federal justice system gives Australia a competitive advantage in the Asia-Pacific region and beyond, so we should be pushing this message to the international business community.

Unfortunately, as a result of the re Wakim decision and the sucking away of matters from the Federal Court, that reputation is now in jeopardy.

I move on to an issue of natural resources, the natural gas pipeline, which again is vitally important and in the future has perhaps even greater potential importance for Australia, given the price fluctuations we have seen in crude oil in recent days in the context where Australia has an abundance of natural gas. A cooperative scheme has been developed—again, under the former Labor government and the states—to enable third parties who have not been part of the pipeline construction process to nonetheless access the transmission facility of the pipeline. But, again, disputes inevitably arise, and they have had a federal focus. So it has been necessary to amend that area.

With respect to the administration of justice generally, one of the most effective and efficient measures introduced, certainly in my period of legal practice, was the jurisdiction of courts cross-vesting legislation, which enabled parties to overcome a ridiculous situation where you had to determine whether matters had to be commenced in the state arena and related proceedings commenced in the federal arena or, if there was a competing choice between jurisdictions, just which one you chose. As a result of the cross-vesting legislation, you were on pretty safe ground wherever you commenced because of the ability to get all the matters relating to the common substratum of fact under the one roof for final determination. Of course, that avoided duplication of legal resources and avoided duplication of court time—and hence saved the public purse. Unfortunately, as a result of re Wakim, the ability for state courts to refer matters to the Federal Court has been disrupted and it has been necessary to make amendments in that area.

Another very important area for Australia is the National Crime Authority Act. That was established in 1984. It is underpinned by legislation of all the states and territories and is effectively a creature of all the states and territories and the Commonwealth. The National Crime Authority has power to compel a person to furnish information or produce documents or attend hearings. There are abilities for private citizens who are aggrieved by the actions of the National Crime Authority, or indeed the National Crime Authority wishing to enforce its orders, to take proceedings sensibly in the federal area but, again because of re Wakim, that has also been affected.

One of the significant economic areas is the Trade Practices Act. Under the Trade Practices Act, a national competition code has been developed to literally regulate fair competition throughout the nation. That has been prejudiced by re Wakim, as indeed has been the government's attempts to establish—and I understand there will be a bill in tomorrow—a code with respect to policing the goods and services tax. That also has many inefficiencies in it now as a result of the re Wakim decision. I am not sure that these measures have anywhere near completely overcome the problems but there is an attempt.

In respect of the area of workplace relations, there are also areas where the states have referred powers to the Federal Court for enforcement. One particular area is in respect of section 5 (7) of the Workplace Relations Act, which gives the Federal Court power to enforce awards, certified agreements and instruments in the area of the coal industry. Those provisions need to be repealed and must be conceded as a result of re Wakim, as is another section relating to the Federal Court exercising unfair dismissal jurisdiction in respect of a state context. We put the government on notice, however, that while these provisions have been repealed, we think there are mechanisms which could be put in place to overcome the re Wakim effect. We are in the process of giving consideration to those and we reserve our right to move appropriate amendments in the Senate.

In summary, a quick walk through those relevant areas points out how significant they are to our national economy, to criminal law enforcement, to natural resources and indeed, in this year dear to everyone's heart, sport. They are matters which fundamentally affect the efficient operating of all these things that affect our daily lives, and so it is vitally important that they be overcome. We have real concerns that, whilst this legislation is an attempt to overcome some of the worst aspects of re Wakim, it is nowhere near the perfect solution.

We note on the horizon two substantial tidal waves building. One is a challenge which will be heard in the High Court in May, I understand, to the legislation of state parliaments validating decisions which have been effectively overturned as a result of the High Court's decision in re Wakim. If that succeeds, it may be necessary for those cases to be relitigated, which would be a massive drain on the resources of the litigants and the community.

The second wave on the horizon is a High Court case of Hughes v. the Queen, which was heard in Perth on 20 October of last year. The decision has been reserved. But that involves a challenge to the operation of the Corporations Law and, in particular, to whether Commonwealth officers are empowered to prosecute corporate offences in the states. If that is set aside, then the decision itself will have great significance for this bill because of the fact that this bill is so focused on empowering officers of the Commonwealth to take action under state legislation. So they are two significant warning signs on the horizon.

In any event, there are other areas where we point out where the bill just cannot address the problems. Obviously, it is impossible for federal officers to be involved in all aspects of these codes. There will, of necessity, be state officers involved; and you will still have a dislocation as to whether you take action against the federal officers and whether you need to simultaneously take action against the state officers. That is a problem. I have pointed out a problem in respect of the Australian Drug Enforcement Agency and whether they are able to bestow power on Federal Court judges in their personal capacity. That is something that we have our doubts about, but the government, no doubt, has its advice.

There are also other schemes which have not been addressed by this bill. I understand the government is bringing in the Agricultural and Veterinary Chemicals Act as the subject of amendment, and we would be agreeing with that. But I draw the government's attention also to the Civil Aviation (Carriers' Liability) Act and the Poisons and Therapeutic Goods Act, which we believe also warrant consideration.

There is also a problem in that there will still be identified special federal matters, such as appeals in the area of family law matters. The problem there is that, if you have a state Supreme Court, for instance, hearing a matter under state jurisdiction with related Family Court proceedings, an appellant against that decision would have to take the family law aspect to the Federal Court but would not be able to drag with it the associated state proceedings. So these dislocations are already in existence.

We also give the government notice that we are concerned with item 67 of the bill, which appears to us to remove an entitlement to legal aid. We are giving further consideration to that, and we reserve our position on it.

I should also indicate some concerns the opposition have with schedule 2 of the bill, which essentially attempts to restrict a person the subject of a federal prosecution from taking administrative review proceedings concurrently with the criminal trial process. Having expressed our reservations, we are prepared to substantially support the government's direction, subject to amendments we will be moving. We have had regard to the fact that these issues regarding the prosecution process—such as the issuing of subpoenas, the issuing of warrants or, indeed, the decision to prosecute itself—can be the subject, and inevitably would be the subject, of argument in the criminal justice process itself, where the trial judge has a discretion as to whether or not to admit evidence. We are also mindful that there will still be the avenue for prerogative relief either in the High Court or in a state Supreme Court.

These things are factored into our agreeing to these amendments, subject to those areas where we say they will operate too harshly. That is, with respect to the situation where there may already be an ADJR application on foot when the prosecution is commenced, we say the judge should have a discretion as to whether or not to continue to hear that. We also have concerns with the retrospective operation of the legislation.

That essentially deals with the subject matters of the bill itself. I wish, in the final parts of this speech, to discuss more general matters regarding perhaps longer term solutions to these problems. In that context, it is probably appropriate if, at this point in time, I move the opposition amendment to the second reading motion. I move:

That all words after “That” be omitted with a view to substituting the following words:

“whilst not declining to give the bill a second reading, the House:

(1) notes the consequences of the decision of the High Court of Australia in Re Wakim;

(2) recognises that the Commonwealth has a leadership role in consultation with the States and Territories to achieve a long term solution to the problems created by the decision;

(3) calls on the government to urgently obtain an appropriate referral of power from each of the States and Territories to ensure that co-operative and cross-vesting schemes are based on a valid exercise of Commonwealth power;

(4) in the event that such referrals do not occur, calls on the government to give serious consideration to holding a constitutional referendum in conjunction with the next federal election to ensure that Federal Courts can exercise jurisdiction referred by the States thereby delivering cheaper and more efficient justice to Australians; and

(5) further notes that this Bill will have the effect of overriding specified laws of the Northern Territory and the Australian Capital Territory and that action of this kind by the Commonwealth Parliament is appropriate and necessary when fundamental issues of justice are concerned such as in respect to the operation of the Northern Territory's mandatory sentencing laws.

The significance of the early part of that second reading amendment underlines just how important these matters are to the economic prosperity of this nation in the areas of the Corporations Law, trade practices law, criminal law enforcement and also—of lesser importance, perhaps, but of considerable interest—sport and also, vitally, in the delivery of natural resources. We have a fear that anything short of a very comprehensive referral of powers by the state governments in these respective areas will not be sufficient to properly address the problems. If a comprehensive referral of powers is not forthcoming, we would urge the government to give consideration to a referendum to address this issue. We think that a referendum would be relatively straightforward and would confirm that, in addition to the federal parliament being able to bestow federal powers on state courts, our federal courts are able to exercise state jurisdiction when that has been referred by the states.

The government has expressed some reluctance to consider a referendum in light of the expense. However, if such a referendum were held at the time of the next election, that expense would be minimised. I point out to the government there really needs to be a process of engaging the Australian community in how our system of government works and how matters such as these which we have discussed are so vitally important to our national economic wellbeing, hence their wellbeing. We need to take action to re-engage Australians in our systems of government. I think research suggests only about 18 per cent have any worthwhile knowledge of how our system of government works and the difference between federal and state powers and the like. A referendum such as this one which enjoys bipartisan support is, I think, a means of re-engaging Australians in the process of considering the issues and seeing the merits of enlivening our Constitution to make it a living and modern document so that our structural settings are in place as we compete in the global environment. I indicate to the government they would have our full support in considering that matter in greater detail.

The final point I would like to make in this speech is in respect of the final paragraph of my second reading amendment, that is, that this demonstrates again that there are many instances where this federal parliament legislates in the area of territories, and we should do so when fundamental issues of justice, fundamental issues of structural dysfunction, arise. In respect of the Northern Territory's mandatory sentencing regime, a fundamental dysfunctional issue has arisen. You will see statements by the Chief Minister, Denis Burke, to the effect that because he is part of a democratically elected government he has the call on what laws to introduce. We all accept that part of a democracy is the election process, but that is only one part. Yes, democracy reflects the will of the majority, but we can have an effectively working democracy only when at the same time the fundamental human rights of minorities are protected. That is not the situation in the Northern Territory. The facts of the matter are that the will of the majority can be just as oppressive as any tyrannical government, and it is fundamental that this parliament expresses to the Northern Territory that it is part of our democratic system; that while we respect and indeed implement the will of the majority, we have to respect and honour the fundamental rights of all Australians. (Time expired)

Mr DEPUTY SPEAKER (Mr Jenkins)—Order! Is the amendment seconded?

Mr Martin Ferguson —I formally second the amendment and reserve my right to speak.