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Monday, 23 June 2008
Page: 5554

Mr NEUMANN (1:45 PM) —I speak in support of the Judiciary Amendment Bill 2008. It is a bill in response to the High Court decision known as British American Tobacco v Western Australia (2003), a decision handed down by the High Court of Australia on 2 September 2003. The decision caused a problem, and it caused a problem for our state governments. The case related to proceedings in federal jurisdiction for invalid tax recovery under the law of Western Australia. The decision was handed down, as I said, on 2 September 2003 and, contrary to what the member for Sturt said, the Howard government really made no clear legislative attempt to remedy this decision in the third and fourth terms of its government.

Decisions of the High Court of Australia have often caused significant impact upon our polity, our economy and our society, and some of those constitutional cases have been welcomed and taken us forward. I think of decisions like the engineers’ case in the 1920s, where ‘plain and simple meaning’ of the Constitution with respect to the exercise of Commonwealth power was used and adopted, and thenceforth great changes were made to constitutional law in this country. Uniform taxation cases in the 1940s, of course, made a big impact and led to the nonimposition of state income tax in this country, and that is a good thing. All those of us who come from Queensland certainly think so. I would also argue that the Franklin Dam case in the 1980s also made a great impact: the Commonwealth government’s power to legislate with respect to foreign affairs power after treaty signature in areas of traditional state domain also advanced the law reform in this country and also the protection of the environment—certainly in Tasmania. The Franklin area is a great place and I would encourage all members to go and have a look at it.

Mr Kerr —The 25th anniversary comes up on 1 July.

Mr NEUMANN —Terrific. I must think about going. I think the Mabo decision could also fall into that category, although some others may disagree. Sometimes, however, decisions of the High Court cause angst, confusion and frustration to both sides of politics. I would think that the Chifley Labor government would probably say that with respect to the bank nationalisation case, and those opposite would also think the same in terms of the Communist Party bills in the 1950s put forward by the Menzies coalition government—although some would argue that, in referenda, the Australian public also acted as its own court of appeal on that particular issue. Others might argue that the Chifley Labor government had the same experience in terms of its electoral demise in 1949. So sometimes High Court decisions cause us plain confusion and sometimes they are great, and both sides of politics support this. But this was a case where the High Court did cause confusion of a financial nature to our state governments and certainly to their revenue.

The actual decision itself of the High Court concerned a claim made by a tobacco wholesaler, BAT, against the government of Western Australia to recover license fees paid under the Business Franchise (Tobacco) Act 1975—a Western Australian piece of legislation. The claim was brought under the Western Australian Crown Suits Act 1947 and it was done after that High Court decision of Ha v New South Wales in 1997, where the High Court of Australia found that fees imposed under a similar law in New South Wales were actually excise duties and contrary to section 90 of the Constitution.

At the time of the BAT case, the Western Australian act said you could not bring up a right of action against the Western Australian government unless a party proposed to give action by giving written notice to the Crown solicitor, advising of certain information within three months of the action accruing or as soon as practicable—whichever was the longer. In fact, the action was brought within one year of the action accruing. In this particular case it was common ground that the action accrued on 5 August 1997, when the judgement was delivered by the High Court in the Ha v New South Wales case. However, written notice was not given under section 6(1) of the Western Australian act until some 10 months after the relevant payment was actually made. That caused a problem. The case also related to federal jurisdiction conferred on the Supreme Court of Western Australia by section 39(2) of the Judiciary Act.

What did the High Court actually find? It found a number of things. It found that a law such as section 39 of the Judiciary Act was an exercise of power under section 78 of the Constitution. The majority of the High Court found that. It also concluded that the Supreme Court of Western Australia had federal jurisdiction because of section 39(2)—and that was supported by the Australian Constitution in section 77(iii). It also found that section 79 of the Judiciary Act did not make section 6(1) of the Western Australia act applicable to federal jurisdiction. What that meant in practical terms was that the limitation period and the notice, a provision in the section 6(1) of the Western Australian act, was not binding on the Supreme Court exercising federal jurisdiction. The High Court then said that the limitation period prescribed by the Western Australian act, which applied only to actions against the Western Australian government, was invalid because it was inconsistent with section 64 of the Judiciary Act. In effect the High Court allowed the company’s appeal with costs.

I have to say, in defence of the High Court—although I have been critical of some of their decisions—that, in fact, the British American Tobacco company paid licence fees invalidly to the state of Western Australia, and it would seem pretty reasonable and fair in the circumstances that they were able to recover their money. All the states have limitation periods, as I said, and we have different limitation periods throughout Australia. What the High Court said was that the special limitation period here did not apply and, of course, the British American Tobacco company could actually get their money back. So this bill restores to the states and territories the position everyone thought they were in prior to the BAT case, and the amendments purport to ensure that the Judiciary Act does not prevent the states and territories recovering money in the circumstances.

Absent this bill there is a real possibility that claims could be made many years after state and territory money has been paid. This would actually impact adversely on our states and territories and certainly on their financial positions. The states and territories could not be assured that their budgetary processes were certain and had integrity. There were consultations by the previous government with the Standing Committee of Attorneys-General which preceded this bill. The states and territories want this bill, and their governments are certainly right to seek it. The Rudd government argues that once again this bill, like so many others, is a clear demonstration of the cooperative federalist approach of the Rudd government. Cooperation and consultation are important in the circumstances between state governments and the federal government, not criticism and condemnation, which were so much the hallmark of the previous administration of this country and so much the approach of the previous Howard government.

It is interesting that the Attorney-General, Robert McClelland, said in his press release on 22 May 2008 that this bill is a clear example of the Rudd government cooperating closely with the states and territories to achieve progress for the future. He described the bill as ‘an example of the Rudd Labor government’s commitment to cooperative federalism’. He also said:

This is a matter that has long languished on the books of the Standing Committee of Attorneys-General for over four years because of the previous government declining to act for political reasons completely unrelated to the substance of the proposed legislation.

His statement is a bit esoteric, a bit obtuse, but the previous government certainly received considerable sums of money from tobacco companies.

This bill has as its objective the restoration of the previous perception held by the states and territories. That perception will become a reality as a result of this bill. The revenues of states and territories will be protected from future claims. The states and territories will be pleased about this bill proceeding. The bill will result in the state and territory governments having more money and more certainty. Their budgetary processes will have more integrity, and that is good for the people of my electorate of Blair in Queensland. It is good because it means more schools and hospitals, better roads and greater certainty. That is good for my electorate and it is good for many others around the country. I commend the bill to the House.