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Ad ban law unconstitutional - QC agrees

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Media Release r- ( 4A-lub


"Former Solicitor General, Sir Maurice Byres QC, has agreed with my assessment that that part of the ad ban legislation providing for so called 'free' time on commercial television stations is unconstitutional and thus invalid", Liberal Senator Bronwyn Bishop said today.

Senator Bishop outlined in the Senate the reasons she considers the 'free' time proposal would fail before the High Court. She maintains that the allocation of 'free' time is ultra vires the Constitution.

'There is no such thing as 'free' time - it is paid for by the shareholders of commercial television stations.

"Barwick CJ in his judgement in Trade Practices Commission v Tooth and Co. Ltd stated that the only head of power that allows the Commonwealth to acquire property is section 51 (xooci). This section of the Constitution states:

The Parliament shall, subject to this Constitution, have power to make laws for the peace, order and good government of the Commonwealth with respect to:-

()ooci) the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws.

"Accordingly, three points are required to be established. Firstly, does the air time which is confiscated from commercial television stations constitute property, secondly if it is property has there been an acquisition of it and, thirdly, if there has been an acquisition has it been on just terms.

"Air time certainly constitutes property as the case law establishes that the term 'property' is to be construed in a liberal way.

"As to acquisition, the judgement in Minister of State for the Army v Dalziel established that the acquisition may be of any interest in property provided two conditions are met: first, that it be on just terms and, secondly, that it be for a purpose in respect of which the Parliament has powers to make laws.

"The Tasmanian Dam's Case established that their must be an acquisition and not merely an extinguishment of rights.

"That an acquisition has occurred is borne out by the fact that the property is not only confiscated by the Commonwealth but converted to the use of other entities - namely political parties.


Clunies Ross v The Commonwealth it was stated in the judgement:

"It would seem to be established that the legislative power conferred by s 51(xxxi) extends to at least to some acquisitions by entities other than the Commonwealth."

"The remaining and most vital question becomes whether the acquisition has been on just terms. It is on this question that the Government's legislation fails.

"Starke J in Bank of New South Wales v The Commonwealth said:

"Just terms' require that a party whose property is acquired shall have the pecuniary equivalent of the property acquired".

"In no way does the Government's ad ban Bill meet this requirement.

"Accordingly, I believe that the legislation is ultra vires the Constitution and would fail before the High Court.

"This view is shared by former Solicitor General for the Commonwealth, Sir Maurice Byers QC in advice contained in a letter from Allen, Allen and Hemsley to the Federation of Commercial Television Stations and which I have had incorporated in the Hansard.

"In addition, Sir Maurice expressed the view that the Bill is inconsistent with the system of responsible Government and any law regulating elections that may have the effect of restricting the electorate's access to information may be unconstitutional.

"If the legislation is ruled against by the High Court the Democrats will have done their deal with the Labor Party for nothing and their $1.8 million worth of free advertising will disappear."

6 December 1991.

Further information: Gerard Wheeler (06) 277 3650

Wednesday, 4 December 1991


media proprietor, things can be done to help a political party like this. What would be the situation—assuming this legislation goes through—if there were no redress against the consequences of that mateship, where programs like 60 Minutes with huge audien-ces could be so subject to mateship that, as in this case, they would make available something that should not be available to a Premier for his advertising campaign? If there were no advertising campaign, what other favours would be done to mates in this situation?

This legislation gives added power to the deals to be done between mates in this situation, without giving political parties the opportunity to respond. The Sydney Morning Herald, when distinguishing between these two clearly separate pieces of legislation, says that the ALP is totally self-serving in proceeding with its political advertising element. The Sydney Morning Herald states:

The public interest has been invoked where, in fact, the only interest that has really concerned the ALP is its own precarious financial position and the fear that the Federal Opposition is in the position to run a devastating advertising campaign against it.

The latest proposals represent a compromise of a previous, cynical compromise.

The Democrats play a role in this. The Sydney Morning Herald states: The Democrats, who agreed to the current

proposals, will now probably face pressure from the various interest groups the party claims to represent. The proposals suggest that the sharing of free television advertising time between the existing political parties be based on the proportion of the vote attracted at the last election. What will happen to interest groups representing, say, the Greens or the Aboriginal community? Would they be able to run advertisements during the campaign? Or would they be considered political groups?

One of the justifications for the proposals is the cost of advertising . .

The article concludes:

The option that apparently hasn't occurred to the ALP is to campaign within its means.

That is what this Bill is all about; it has nothing to do with the principle that the Labor Party has been going on about. The Bill creates potential for serious corruption and it denies political parties that have a story

to tell, that have a message to give, the right to counter the sorts of messages which will now be limited to the gurus irk the media.

Senator BISHOP (New South Wales) (11.57 a.m.)—/ want to address the question of why it is important to split the Political Broadcasts and Political Disclosures Bill

1991. The material I want to raise goes to the question as to whether one part of this Bill— that dealing with political advertising, the banning thereof and the allocation of so-called free time—is ultra vires the Constitution.

There are three important points that need to be addressed in looking at the subject matter. First, is the time that is confiscated from the commercial television stations property? Secondly, if it is property, has there been an acquisition of it by either the Com-monwealth or another party? Thirdly, if there has been such an acquisition of the property, has it been on just terms? Those reasons are pertinent because of section 51(xxxi) of the Constitution. Section 51 states:

The Parliament shall, subject to this Constitution, have power to make laws for the peace, order and good government of the Commonwealth with respect to:-

(xxxi) the acquisition of property on just terms from any State or person for any purpose in respect of which the Par-liament has power to make laws.

That becomes the only relevant clause in the Constitution, and the only clause that can give power for this legislation, because of the case law. It is quite clear. First, I refer to the case

of Clunies Ross v. the Commonwealth, reported at 155 CLR. In that case, the joint judgment of the six judges of the High Court declared:

The plenary grant of legislative power contained in section 51(xxxi) has assumed the status of constitutional guarantee of just terms, as established

in the Minister for the Army v. Dalziel (1944). It is to be given the liberal construction appropriate to such a constitutional provision.

The case cited is the Attorney-General v. Schmidt. The most up-to-date case, decided on only 29 October 1991, is the case of Peverill v. Health Insurance Commission, heard in the Federal Court of Australia by Burchett J., who said:


Wednesday, 4 December 1991

To construe a constitutional guarantee narrowly would be by that to diminish it and the Constitution. Repeatedly, and in various forms, this fundamental principle is laid down in the cases.

He goes on to cite cases where that has been determined. What he is saying is that section 51 (xxxi) is to be construed as a guarantee and that, further, it is to be construed in a liberal way. As we go through the case law we will see that 'property' is to be widely interpreted, not simply in terms of whether it is an estate in fee simple or something of the like.

The case law also establishes that one may not avoid the guarantee by using a circuitous method and using a statute which one believes could avoid that guarantee. Isaacs J., in a 1926 case, Commonwealth and Common-wealth Oil Refineries Ltd v. South Australia, states that, if a statute transgresses a constitutional prohibition either specifically or in a circuitous manner, then it will be struck down as well.

So there are three important things that we have established: first, that the Constitution implies a guarantee; secondly, that the word 'property' is to be broadly construed, that is, liberally construed; and, thirdly, that one may not avoid the guarantee by using a circuitous method and using a statute which one believes could avoid that guarantee.

Isaacs J. said that the test to be applied to the impugned legislation is the substance of the operation of the statute rather than merely its form. But the pivotal case remains the Minister of State for the Army v. Dalziel, the

1944 case that I mentioned previously. In that case, Latham, the then Chief Justice, made the statement: The provision in the Constitution is plainly in-

tended for the protection of the subject, and should be liberally interpreted. Rich J. in the same case went on to say: What we are concerned with is not a private document creating rights inter partes, but a Constitution containing a provision of a fundamen-tal character designed to protect citizens from being deprived of their property by the Sovereign State except upon just terms.

The meaning of property in such a connection must be determined upon general principles of jurisprudence, not by the artificial

refinements of any particular legal system or by reference to Sheppard's Touchstone. The language used is perfectly general. It says 'the acquisition of property'; it is not restricted to acquisition by particular methods or of par-ticular types of interest, nor to particular types of property. It extends to any acquisition of any interest in any property. It authorises such acquisition, but it expressly imposes two conditions on every such acquisition. It must be upon just terms and it must be for a purpose in respect of which the Parliament has power to make the laws'.

The important thing here is that by any definition the property which is being ac-quired by the Commonwealth to be handed over to a third party, that is, in this case, the

Democrats, the Labor Party, or indeed the Liberal Party for that matter, is property which has been seized, which has been acquired. The point that it has been acquired is borne out by the fact that it is passed over to somebody else to use and do something with. When one looks at whether or not there are just terms provided for this acquisition, one must answer no.

To recap, so we understand, we have property which is being acquired—and, in the words of the Constitution and the case law interpretation, it may only be so acquired on just terms. If it fails that test, then it is ultra

vires the Constitution and it fails. In other words, the deal that has been put together by the Democrats with the Labor Party—that they, in return for whatever it is they have agreed to, get their talking heads commercials free to them but at the expense of somebody else in the run-up to the election—is ultra vices and not valid legislation.

Senator Boikus—That is rubbish. That is total rubbish.

Senator BISHOP—The Minister glibly says it is rubbish, but he is not willing to have it tested. He is not willing to have the Bill separated so that we can look at the validity of one and leave the other. Dr Hew-son said right from the beginning that we

were in favour of disclosure when it was on fair and just terms. That is still our position. We would like to deal with the Bill in those terms. But there is also good evidence that the

Wednesday, 4 December 1991


Bill, which is the vehicle which has allowed the Labor Party to do a deal with the Democrats, is in fact not valid. It is something that ought to be tested, and it ought to be examined and discussed and not guillotined through this Parliament.

Look again at the case of Minister of State for the Army v. Dalziel. I have read the portion of Latham C.J. and Rich J. Mr Justice Burchett, in the case that I have mentioned, dated 29 October 1991, says quite clearly that he takes that case to mean:

S. 51(xxxi) is not to be confined pedantically to the taking of title by the Commonwealth to some specific estate or interest in land recognized at law or in equity and to some specific form of property

in a chattel or chose in action similarly recognized, but that it extends to innominate and anomalous interests and includes the assumption and indefinite continuance of exclusive possession and control for the purposes of the Commonwealth of any subject of property. Section 51 (xxxi) serves a double purpose. It provides the Commonwealth Parliament with a legislative power of acquiring property: at the same time as a condition upon the exercise of the power it provides the individual or the State, affected with a protection against governmental

interferences with his proprietary rights without just recompense. In both aspects consistency with the principles upon which constitutional provisions are interpreted and applied demands that the paragraph should be given as full and flexible an operation as

will cover the objects it was designed to effect. Moreover, when a constitution undertakes to forbid or restrain some legislative course, there can be no prohibition to which it is more proper to apply the principle embodied . . In requiring just terms s. 51(xicx.i) fetters the legislative power by forbidding laws with respect to acquisition on any terms that are not just. Barwick C.J., as he then was, in Trade Practices Cornrnission v. Tooth and Co. Ltd in a case reported in the CLR 142 at page 403, said: 11 has been decided, and in my respectful opinion quite correctly, that the presence of s. 5I(xxxi) in the Constitution means that no other head of power, including the incidental power, would support a law for the acquisition of property.

In other words, this is the only head of power in the Constitution which allows the Com-monwealth to acquire that property. The reason is plain. The constitutional purpose is

to ensure that in no circumstance will a law of the Commonwealth provide for the ac-quisition of property except upon just terms.

Section 51 is a very great constitutional safeguard not confined to the protection of the citizen from the confiscation of his property by the state. It ensures that no-one may by virtue of a Commonwealth statutory provision acquire his property except on just terms. Again, Gibbs picks up the question of a circuitous device saying that it simply will not be permitted to circumvent that clause of the Constitution.

On the question of the need for an ac-quisition to take place, as distinct from merely depriving someone of something, there is again relevant case law in the Tasmanian dams case. In the interests of time, I recom-mend people to the judgments of Justices Mason, Brennan and Deane, wherein they state very clearly that there has to be an

acquisition of the property. Indeed, the impor-tant words of Brennan J, were:

Where neither the Commonwealth nor any other person acquires property rights under a law of the Commonwealth, there is no acquisition upon which the paragraph may fasten.

But clearly in this case there is an acquisition of proprietary rights which are conferred upon third parties, as is encompassed in that statement of Brennan, J. The fact of the

matter is that we have established that the time that is confiscated by the Government is property and there is an acquisition of it. We then come to the third point I raised at the beginning, and that is the question of whether it is acquired on just terms. Again, we can go to the case law, where it says that there is a simple definition of 'just terms'. Mr Justice Starke in the Bank of New South Wales v. the Commonwealth said:

... "just terms' require that a party whose property is acquired shall have the pecuniary equivalent of the property acquired.

Quite clearly, this legislation does not provide for that. As I said at the beginning in speaking to the motion moved by Senator Parer, that the two of parts of the Bill should be separated and dealt with as two entirely separate pieces of legislation is not only reasonable but is logical, sensible and e-


SENATE Wednesday, 4 December 1991

quitable. The Democrats have been placed in a position where they have had some legal advice and some advices made available to them—advices which I might say at this stage I have not seen but which I would be interested in looking at.

This area is one in which a prima facie case has been made out that this legislation could indeed be ultra vires the Constitution. As such, any reasonable man, or indeed any reasonable Minister, would consider that it is a logical and sensible course of action to now deal with the question of disclosure but to

leave the question of whether this legislation either is or can be made valid so that proper investigation can be made. In fairness to the people with whom the Government has offered a deal—the Democrats—and in their own interests, it would be sensible for them to look at what sort of deal it is that they have struck.

Senator BOLKUS (South Australia— Minister for Administrative Services) (12.13 p.m.)—I will not take up too much of the Senate's time, but I do think it is important to respond to the point that Senator Bishop has just made. The Government has, of course,

had advice on she provisions from time to time, and more particularly had advice on them at the start of this process. The matter that has been raised by Senator Bishop has been raised, probably chapter and verse, by the Federation of Australian Commercial Television Stations, FACTS, the industry lobby group in this area.

I do not need to say much more to the Senate other than that we have discussed this with the appropriate people who advise government. The advice that I have been given is that there is absolutely nothing to worry about. Senator Bishop may jump up again, so 1 say that that advice has been verbal. It has had to be verbal because of the short time that we have had. The advice, which was very clear and succinct, was that this approach has absolutely no legs.

I do not doubt that Senator Bishop and her friends around the place will possibly con-sider a challenge—Nick Greiner, the Premier of New South Wales, has already indicated that. But I say to the Opposition and to

anyone who might be listening that the advice on the initial Bill made it clear that the Government was acting within the parameters of the Constitution. The advice on the free time provisions was very succinct and, as I say, the argument has no legs.

Senator Parer—It was free.

Senator BOLKUS—It was not free, So we are confident that what we are doing is within the Constitution. I am also quite confident that during the afternoon, for the next seven hours and 15 minutes, we will get a number of other furphies as we have for the last 24 hours.

Senator BISHOP (New South Wales)—by leave—With regard to the Minister having told us that the advice he has received was verbal advice, presumably he has made some notes or has had some notification of that advice. Presumably, when he acts in bringing forward legislation he does not just rely on the memory of a chat that he has had with the Attorney-General or some other member of the legal fraternity within the Government structure. Would the Minister be kind enough to furnish the Senate with whatever documen-tation he has which goes to the question of legality and ultra vires of the legislation that we are discussing, that is, the advertising ban legislation?

Senator BOLKUS (South Australia— Minister for Administrative Services)—by leave—Senator Bishop knows—and she has been here tong enough to know—that this is yet another furphy. The advice that the Government gets from its legal advisers is always kept within government. That is very much part of the process of government. The advice that we have had is from the highest sectors of the legal advisory system. It was verbal and I did not keep any notes of it.

Question put:

That the motion (Senator Parer's) be agreed to.

The Senate divided. [12.18 p.m.]

(The President—Senator the Hon. Kerry Sibraa)

Ayes .................................. ....... 31

Noes .................................. ....... 35




Wednesday, 4 December 1991 SENATE 4157

Senator BISHOP—I wanted to seek your guidance. When I spoke a little earlier, I spoke on the point of regulations and the difficulty of being faced with having no access to the television time if those regula-tions were disallowed, and I also spoke about

the legality—the constitutional question. I wanted to seek leave to incorporate in Hansard a copy of a letter from Allen Allen and Hemsley expressing a view of Sir Maurice Byers on the question of constitu-tionality. I would seek your guidance on

whether I can do that now or whether it would be more appropriate to do it at a different time.

The TEMPORARY CHAIRMAN— Senator, you are at liberty, with leave of the Committee, to incorporate it now. Leave has been sought to incorporate a letter from Allen Allen and Hemsley. Is there any objection?

Leave granted.

The letter read as follows— Mr. Tony Branigan Federation of Australian Commercial Television Stations 44 Avenue Road MOSMAN NSW 2088 BY FACSIMILE Dear Sir, POLITICAL BROADCASTS AND POLITICAL DISCLOSURES BILL 1991 We confirm that today we met with Sir Maurice Byers Q.C., former Solicitor General for the Commonwealth, to discuss with him proposed

amendments to the Political Broadcasts and Politi-cal Disclosures Bill 1991.

The amendments discussed with Sir Maurice related to proposals to amend the Broadcas t ing Act 1942 by modifying the proposed moratorium on the broadcast of political advertising and providing for a system of frectime election broadcasts. Under proposed Section 95DK of the Broadcasting Act, broadcasters will be compelled to allocate units of freetime (an undefined term) for the purposes of making election broadcasts during the relevant election period for the person to whom time has been granted. Under proposed Clause 95DK(5), a broadcaster is required to make that election broadcast free of charge.

Proposed Section 95DK(7) provides that licensees required to make election broadcasts have an entitlement to such additional broadcasting time to broadcast other material (including advertisements and station promotions) as is determined by the regulations.

In summary, Sir Maurice Byers views were as follows:

(a) Section 95DK is invalid because it is inconsis-tent with the protective guarantee of just terms in Section 51(31) of the Constitution.

Even if the law could be categorised as being one with respect to the power granted by Section 51(5) of the Constitution (that is, a law with respect to "postal, telegraphic, tele-phonic and other like services") it would be

invalid because "the effect of the purpose of paragraph (31) with its requirement for 'just terms', in Section 51 is that other heads of power, including the incidental power s do not authorise legislation for the acquisition of

property: the Tasmanian Dam Case (1983) 158 CLR 1, 282.

Commercial television licensees have the right to sell time, without restriction, during a 24 hour day and that right is property for the purposes of Section 51(31) of the Constitution.

The question whether just terms had been provided would turn on whether an allowance of extra advertising or promotional time per hour was practicable: if it was not practicable then the acquisition would be unfair. If the acquisition was unfair then it would not be on 'just terms'.

In addition, Sir Maurice expressed the preliminary view that the Bill as a whole is inconsistent with the system of responsible Government envisaged by the Constitution, in particular, the free flow of information to electors. In his view, any taw regulating elections that may have the effect of restricting the electorate's access to information

may be unconstitutional.

Should you have any questions please do not hesitate to telephone Ian McGill of this office.

Yours faithfully,

Allen Allen Hernsley