Litigation Notes No. 8

Number 8
29 August 2002

Reversal of Decisions

The High Court has held that a decision maker who
makes a sufficiently serious error can in effect 'remake'
the decision in order to fulfil their statutory function.
The judgment also contains interesting comments about
the nature of administrative decisions and the description
of erroneous administrative decisions as 'void' or
'voidable'.

The Immigration Review Tribunal made a 'decision'
affirming the cancellation of the respondent's visa.
However, through an administrative oversight, the Tribunal
did not give the respondent an opportunity to attend
a hearing to present evidence and argument before doing
so. The Tribunal later conducted a further hearing
and made a fresh decision. A majority of the High Court
(Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan
JJ, Kirby J dissenting) held that the Tribunal was
able to do this.

Minister for Immigration and Multicultural Affairs
v Bhardwaj

High Court of Australia, 14 March 2002
[2002] HCA 11; (2002) 187 ALR 117

Background

The respondent's student visa was cancelled by a delegate
of the Minister ('the appellant') under the Migration
Act 1958 ('the Act'). The respondent applied for
review of that decision by the Immigration Review Tribunal
('the Tribunal'). The Tribunal invited the applicant
to attend a hearing on 15 September 1998.

Late on 14 September 1998 the Tribunal received a letter
from the respondent's agent requesting an adjournment
of the hearing on the ground that the respondent was
ill. That letter did not come to the attention of the
member of the Tribunal to whom the review had been assigned,
and on 16 September 1998 the Tribunal affirmed the cancellation
decision ('the September decision'). The Tribunal communicated
its decision to the respondent and his agent the next
day.

The respondent's agent drew the attention of the Tribunal
to the letter requesting an adjournment, after which
a new hearing was arranged, at which the respondent presented
evidence. On 22 October 1998 the Tribunal revoked the
cancellation decision and published its decision ('the
October decision').

The appellant applied to have the October decision set
aside by the Federal Court on the basis that the Tribunal
had no power to review the cancellation decision after
making the September decision. That application was dismissed
by a single judge and by a majority of the Full Court
on appeal ((2000) 99 FCR 251). The matter came before
the High Court after it granted the Minister's application
for special leave to appeal.

Issue

The issue was whether the Tribunal was able to reconsider
the respondent's review application and make the October
decision, in particular in light of the statutory scheme
in the Act.

Legislation

Part 5 of the Act concerned review by the Tribunal.
Unless the Tribunal made a decision on the papers favourable
to the respondent, s.360 required the Tribunal to give
the respondent an opportunity to appear before it and
give evidence and present arguments. Sections 367 and
368 made provision in relation to the Tribunal's 'decision
on review', in particular specifying how the Tribunal
was to record the reasons for its decision.

Part 8 of the Act provided for review by the Federal
Court of various decisions, including decisions of the
Tribunal, to the exclusion of most other jurisdiction
of that Court (s.485). Review under Part 8 was on limited
grounds, so that, for example, breach of the rules of
natural justice was not a ground of review (s.476(2)(a)).
Applications for review under Part 8 were strictly required
to be made within 28 days (s.478).

Arguments

The appellant argued that the statutory scheme for review
of decisions under Parts 5 and 8 of the Act then in force
manifested an intention to preclude the reconsideration
undertaken by the Tribunal, and that this was a contrary
indication for the purposes of s.33(1) of the Acts
Interpretation Act 1901 ('the AIA'). Subsection 33(1)
provides that where an Act confers a power or imposes
a duty, then, unless the contrary intention appears,
the power may be exercised and the duty shall be performed
from time to time as occasion requires. The appellant
accepted that the Tribunal had denied the respondent
an opportunity to answer the case against him, but considered
that the respondent's only remedy was to challenge the
September decision before a court.

The respondent argued that it was consistent with general
principles relating to administrative decisions reached
in breach of the rules of natural justice for the Tribunal
to reconsider the September decision, and that the September
decision was not a 'decision on review' for the purposes
of sections 367 and 368 of the Act and therefore had
no legal effect.

Majority reasoning

By a 6-1 majority (Kirby J dissenting), the High Court
dismissed the Minister's appeal. The majority judges
all held that the Act permitted the action taken by the
Tribunal.

The Tribunal's error was characterised by Gleeson CJ
as not just a denial of procedural fairness, but a failure
to conduct a review of the decision.

The remaining majority judges characterised the Tribunal's
error as a jurisdictional error. In essence, the Tribunal
had denied the respondent something the Act required
him to be given, namely an opportunity to answer the
case against him.

All the majority judges held that the Tribunal had failed
to discharge its statutory function in making the September
decision, such that the Tribunal's review function remained
unperformed.

The Court held that nothing in the Act or the principles
of administrative law required that a purported decision
involving jurisdictional error should be treated as valid
unless and until set aside by a court. Thus it was open
to the Tribunal to reconsider the matter and make the
October decision.

Gaudron and Gummow JJ (with whom McHugh J agreed in
general) and Hayne J all decided that there was no need
to rely upon s.33(1) of the AIA to support the Tribunal's
action because, prior to the October decision, there
had been no relevant exercise of power by the Tribunal.
The reasoning of Gleeson CJ and Callinan J suggests that
they would agree with this.

Minority reasoning

Kirby J held that, on its proper construction, the Act
forbade the Tribunal from making the October decision.
In his view, the Act envisaged a single exercise of the
'review' performed by the Tribunal which, perfect or
imperfect, would be given effect in a 'decision'. He
referred to the 'explicit provisions of considerable
detail' constituting a 'formal process' relating to such
a 'decision' and said that these provisions either had
to be obeyed or they followed automatically by force
of the Act itself. In his view the Act evinced a contrary
intention for the purposes of s.33(1) of the AIA. Parliament
had decided that there should be a high degree of clarity
and certainty in relation to migration decisions, even
if the result was administrative inflexibility. He also
noted that if a decision unfavourable to a person could
be treated as provisional, then so also could a decision
favourable to a person.

Text of the decision is available at: http://www.austlii.edu.au/au/cases/cth/high_ct/2002/11.html

Contacts for further information:

Peter Lahy
Senior General Counsel

Tel: (02) 6253 7085
Fax: (02) 6253 7304
E-mail: peter.lahy@ags.gov.au

Charles Beltz
Counsel

Tel: (02) 6253 7108
Fax: (02) 6253 7304
E-mail: charles.beltz@ags.gov.au

Robert Orr QC
Deputy General Counsel

Tel: (02) 6253 7017
Fax: (02) 6253 7304
E-mail: robert.orr@ags.gov.au

Validity of Child Support Scheme

The High Court unanimously upheld the constitutional
validity of the scheme established by the Child
Support (Assessment) Act 1989 and the Child
Support (Registration and Collection) Act 1988. The
Court held that the Registration and Collection Act
did not impose taxation on a liable parent and therefore
did not contravene s.55 of the Constitution (concerning
the form of tax bills).

The Court also held that the Acts did not contravene
Chapter III of the Constitution by conferring the judicial
power of the Commonwealth on the Registrar of Child
Support (who is given a power to determine assessments
of liability to pay child support).

Luton v Lessels and Child Support Registrar

High Court of Australia, 11 April 2002
[2002] HCA 13; (2002) 187 ALR 529

Background

The Assessment Act provides for the creation of child
support liabilities upon the acceptance by the Registrar
of an application for administrative assessment of child
support. The amount of the child support liability is
calculated in accordance with a statutory formula, unless
a determination is made by the Registrar or an order
is made by a court that the provisions relating to administrative
assessment of child support should be departed from.
The making of an assessment gives rise to a debt between
the liable parent and the carer entitled to child support.

The Registration and Collection Act provides a mechanism
by which child support liabilities may be registered
and enforced. Registration replaces the debt owed by
the liable parent to the carer entitled to child support
with a debt owed by the liable parent to the Commonwealth,
and provides the carer entitled to child support with
an entitlement to payment by the Commonwealth of an amount
equivalent to that paid by the liable parent to the Commonwealth.
This debt must be paid in the manner prescribed by the
Act, and may be collected by, among other means, deductions
from the liable parent's salary or wages, and by the
application of certain amounts owing to the liable parent
by the Commonwealth (for example, tax overpayments).
The amounts collected are part of the Consolidated Revenue
Fund and equivalent amounts are paid to the carer out
of a child support account.

The plaintiff was subject to a registered child support
liability arising from an assessment made under the Assessment
Act. He brought proceedings in the original jurisdiction
of the High Court challenging the constitutional validity
of the Acts. Questions as to the validity of the Acts
were reserved for the consideration of the Full Court
of the High Court.

The High Court unanimously upheld validity in four separate
judgments given by Gleeson CJ (with whom McHugh J agreed),
Gaudron and Hayne JJ, Kirby J and Callinan J. Gummow
J did not sit.

Section 55 of the Constitution and taxation

Section 55 of the Constitution provides in part that
'[l]aws imposing taxation shall deal only with the imposition
of taxation, and any provision therein dealing with any
other matter shall be of no effect.' The Senate may not
originate or amend bills imposing taxation (Constitution,
s.53) and s.55 is designed to protect the powers of the
Senate by preventing 'tacking' (ie. attaching provisions
not imposing taxation to a taxation bill). The plaintiff
argued that the exaction of moneys from liable parents
under the Registration and Collection Act involved the
imposition of taxation and that the Act contravened s.55
and was of no effect.

The traditional description of a tax is 'a compulsory
exaction of money by a public authority for public purposes,
enforceable by law, and is not a payment for services
rendered' (Matthews v Chicory Marketing Board (Vict) (1938)
60 CLR 263, Latham CJ). However, the Court did not treat
the Chicory Marketing Board description as exhaustive
of the factors relevant to the characterisation of an
impost as a tax for constitutional purposes.

Gleeson CJ, Kirby J and Callinan J considered that the
exaction of child support liabilities was not for the
public purpose of raising revenue but for, in effect,
enforcing the payment of a pre-existing private liability
by a particular parent for the benefit of a particular
child and that, on this basis, the exaction was not a
tax. This collection mechanism involved no financial
benefit to the Commonwealth.

Gaudron and Hayne JJ also found that the exaction was
not a tax. They did not expressly rely on lack of revenue
raising purpose. However, they similarly relied on the
precise correspondence between the pre-existing obligation,
the amount paid by the payer and the Commonwealth's substituted
obligation to pay the carer to find that the exaction
did not constitute a tax.

The precise correspondence between the pre-existing
obligation, the amount paid and the Commonwealth's obligation
to pay distinguished the child support legislation from
the provision held to impose a tax in Australian Tape
Manufacturers Association Ltd v Commonwealth (1993)
176 CLR 480. In that case, the provision imposed a 'royalty'
on persons who sold, let or distributed blank tapes which
was to be paid direct to a collecting society for the
benefit of copyright owners. The amounts received by
copyright owners were not related to any right or consent
granted by the copyright owner in relation to their copyright
work.

Gleeson CJ, Gaudron and Hayne JJ and Kirby J took the
view that the fact that an impost is part of the Consolidated
Revenue Fund is a relevant factor in favour of the characterisation
of the impost as a tax but does not decisively determine
the question (contrary to what had been suggested by
a majority of the High Court in Australian Tape Manufacturers
Association Ltd v Commonwealth (1993) 176 CLR 480
at 503).

Judicial power

Only the courts specified in s.71 of the Constitution
may exercise the judicial power of the Commonwealth.
The plaintiff argued that the Child Support Registrar
(who is not a court) exercises judicial power in making
administrative assessments and determinations departing
from those assessments and in registering child support
liabilities, and that the Assessment Act and the Registration
and Collection Acts are invalid to the extent that they
provide for the Registrar to exercise those powers.

The High Court has stated 'many times that it is impossible
to give an exhaustive definition of judicial power' (Kirby
J, para 124). A range of factors will be relevant. However,
the exercise of judicial power is generally said to involve
making binding and conclusive determinations of existing
legal rights. All members of the Court agreed that the
Registrar does not exercise judicial power, essentially
because the Registrar's determinations involve creating
rights and liabilities for the future, rather than determining
existing rights, and are not binding or conclusive in
the relevant sense.

The Court accepted that, although the powers exercised
by the Registrar require the application of statutory
criteria to facts, the Registrar's powers involve creation
of future rights and liabilities. According to Gleeson
CJ, Gaudron and Hayne JJ, the assessment or departure
determination made by the Registrar is a factum by
reference to which the Assessment Act itself operates
to fix the rights and liabilities of the parties. Associated
with this, the Court accepted that the Registrar performs
classically administrative functions. Gleeson CJ said
at paragraph 21 that '[t]he making of decisions by the
application of legal criteria to facts as found is characteristic,
but not distinctive, of the judicial function. It is
also characteristic of many administrative functions.'
He compared the powers exercised by the Registrar with
those exercised by decision makers under the Migration
Act 1958. Other judges relied on the limited fact
finding role of the Registrar and the limited discretion
of the Registrar, at least in making administrative assessments
according to the statutory formula.

In relation to the more discretionary power to make
a determination departing from the administrative assessment
(similar to the departure power conferred on courts),
none of the judges had any difficulty finding that the
power is non-judicial. In this context, Gaudron and Hayne
JJ noted that the Registrar can refuse to make a departure
determination if the issues are 'too complex' and can
refer the matter to a court. Kirby J considered that
the discretion afforded to the Registrar reinforced the
conclusion that the Registrar's determination involved
the creation of new rights and liabilities in the exercise
of non-judicial power.

The decisions of the Registrar under the Assessment
Act and the Registration and Collection Act were held
not to be binding so as to involve conferral of judicial
power on the Registrar. The Court found that the Registrar
could not enforce his or her own determinations; enforcement
of child support liabilities involves the intervention
of a court and the independent exercise of judicial power
(in contrast with the HREOC determinations considered
in Brandy v Human Rights and Equal Opportunity Commission (1995)
183 CLR 245). Also, the decisions made by the Registrar
are not conclusive and are subject to a regime of internal
review and appeal to a court, and a court can make a
departure determination at any time overriding any determination
previously made by the Registrar.

Callinan J considered it significant that provision
is made for appeals by way of re-hearing rather than
for a more limited form of judicial review such as review
under the Administrative Decisions (Judicial Review)
Act 1978. However, as Gleeson CJ, Gaudron, McHugh,
Gummow, Hayne and Callinan JJ noted in Attorney-General
(Cth) v Breckler (1999) 197 CLR 83 at 112, legislation
conferring a power on an administrative tribunal was
held valid by the High Court in R v Trade Practices
Tribunal; Ex parte Tasmanian Breweries (1970) 123
CLR 361 even though the only form of review of the tribunal's
decisions was an application to the High Court under
s.75(v) of the Constitution for prohibition, mandamus
or injunction.

Text of the decision is available at:
http://www.austlii.edu.au/au/cases/cth/high_ct/2002/13.html

Contacts for further information:

Jenny Burnett
Senior Executive Lawyer

Tel: (02) 6253 7012
Fax: (02) 6253 7303
E-Mail: jenny.burnett@ags.gov.au

Helen Robertson
Senior Lawyer

Tel: (02) 6253 7067
Fax: (02) 6253 7303
E-Mail: helen.robertson@ags.gov.au

Confidentiality of Information

In this appeal a majority of the High Court (Kirby
J and Callinan J dissenting; McHugh J did not sit)
held that an innocent recipient of illegally taped
non-confidential information cannot be restrained from
publishing that information. A majority declined to
recognise an Australian tort of invasion of privacy,
at least with respect to corporations, but indicated
that Victoria Park Racing and Recreation Grounds
Co Ltd v Taylor (1937) 58 CLR 479 (a case in which
the High Court held that there was no proprietary interest
in a spectacle - in that case, a horse race) did not
stand in the way of the development of such a tort
with respect to natural persons.

Australian Broadcasting Corporation v Lenah Game
Meats Pty Ltd

High Court of Australia, 15 November 2001
[2001] HCA 63; (2001) 185 ALR 1

Background

Lenah Game Meats slaughtered brush tail possums at its
abattoir in Tasmania. Lenah asserted that unknown persons
broke into its premises, installed video cameras and
taped aspects of its operations, in particular, the stunning
and killing of possums. It then asserted that Animal
Liberation gave a copy of the tape to the ABC. Lenah
pleaded that it was the intention of the ABC to incorporate
excerpts of the tape in the '7.30 Report'. It was not
alleged that the ABC was implicated in or privy to the
trespass.

Lenah sought interlocutory injunctive relief in the
Tasmanian Supreme Court seeking to restrain the ABC from
broadcasting the tape. The action was dismissed at first
instance on the basis that the statement of claim disclosed
no cause of action against the ABC. On appeal the Full
Court, by majority, granted the injunction.

The ABC appealed to the High Court. Lenah sought to
uphold the order made by the Full Court on the ground
that it was unnecessary to identify a recognisable cause
of action in circumstances where the publication of the
tape, as here, was unconscionable. It also submitted
that the publication of the tape would constitute an
actionable invasion of Lenah's right to privacy. The
ABC contended that an interlocutory injunction could
not be granted in the absence of a recognisable cause
of action, that this was not an appropriate case to consider
whether the common law recognises a tort of invasion
of privacy, and that any formulation of a principle regarding
injunctive relief must give effect to the implied freedom
of political communication identified in Lange v Australian
Broadcasting Corporation (1997) 189 CLR 520. The
Commonwealth Attorney-General intervened in the High
Court and argued that there was power to grant an injunction
restraining publication in these circumstances and that
this power did not infringe the Lange principle.
The Attorney-General argued against the recognition of
a tort of invasion of privacy.

Interlocutory injunctions

Gleeson CJ and in a separate judgment Gummow and Hayne
JJ (with whom Gaudron J agreed) held that the legal or
equitable rights in respect of which final relief is
sought must be identified before an interlocutory injunction
can be granted. No such rights could be identified against
the ABC: the ABC had not broken any law, there was no
breach of confidence, no conspiracy, no defamation, no
breach of copyright, no infringement of trade secrets
and, as an article of personal property, the video did
not belong to Lenah. As no legal or equitable right against
the ABC could be identified, interlocutory injunctive
relief could not be granted. Unconscionable conduct on
its own was not enough to found the grant of an interlocutory
injunction (see paras 17, 55, 98-105).

Kirby J took a different approach. His Honour considered
that there was no absolute rule that a cause of action
must be established before an interlocutory injunction
may be granted. Further, an interlocutory injunction
could be granted where non-confidential information has
been improperly obtained and publication of that information
would be unconscionable (para 170). Unconscionability
in these circumstances is to be determined by reference
to all of the circumstances of the case including the
sometimes competing public interests in upholding the
integrity of private property and personal rights and
defending freedom of speech and expression (para 181).

Callinan J recognised that an underlying cause of action
against the person sought to be restrained was generally
necessary to support the grant of an injunction. However,
he considered that there was no strong reason in principle,
modern authority, or in the interests of justice, why
an injunction, without more, should not be granted to
restrain the enjoyment of property unlawfully obtained,
especially when the person sought to be enjoined knows
or ought reasonably to know of its illegal genesis (para
287). Callinan J considered that because of its possession
of the illegally obtained tape, the ABC was in a relationship
of a fiduciary kind and of confidence with Lenah. Equity
therefore required the ABC to deliver the tape to Lenah
(para 297).

The implied freedom of political communication

The decision of the majority judges made it unnecessary
for them to consider the application of the implied freedom
of political communication to this case. The implied
freedom was, however, considered by Kirby J and Callinan
J.

Kirby J considered that the information contained on
the illegally obtained tapes was prima facie protected
by the implied freedom of political communication referred
to in Lange, especially having regard to the fact
that the ABC is a federally-established corporation with
powers that extend to facilitating political and governmental
discourse throughout Australia, his view that the Constitution
contemplates representative State Parliaments and the
fact that Lenah was engaged in an export business (paras
197-198). However, the power to restrain the publication
of that information was compatible with the constitutionally
prescribed system of representative democracy. The existence
of that power therefore did not infringe the Lange principle
(paras 200-201). Nonetheless, the Lange principle
was a relevant matter to be considered by a judge when
deciding whether to grant an interlocutory injunction
and the Full Court's exercise of its discretion miscarried
because it failed to give appropriate consideration to
it (para 214).

Callinan J indicated that he would not have found an
implied freedom of political communication in the Constitution
(paragraph 338, esp. footnote 486), would not have modified
the common law of defamation (as the Court did in Lange)
so as to comply with the constitutional implication (para
342) and would resist any expansion of the Lange principle
(para 348). To apply the Lange principle to the
facts of this case, in his view, would involve a considerable
and unacceptable expansion of the principle.

Tort of invasion of privacy

Gleeson CJ declined to recognise a tort of invasion
of privacy. In his view, if private activities are surreptitiously
filmed, the law of breach of confidence is adequate to
provide redress where appropriate. Those principles impose
an obligation of confidence upon the person who surreptitiously
obtains the film and upon those into whose possession
the film comes if they know, or ought to know, the manner
in which it was obtained (para 39). However, an activity
is not 'private' for these purposes merely because it
occurs on private property. Rather, an activity will
often only be 'private' if the disclosure or observation
of the activity in question would be highly offensive
to a reasonable person of ordinary sensibilities (para
42). Gleeson CJ considered that Lenah failed to show
that the activities secretly taped were private in the
relevant sense. Having reached this conclusion, he found
it unnecessary to consider whether, and in what circumstances,
a corporation might invoke a right to privacy.

Gummow and Hayne JJ (with whom Gaudron J agreed) left
open the question whether a tort of invasion of privacy
should be developed with respect to natural persons.
In particular, their Honours rejected the view that Victoria
Park stands in the path of the development of such
a tort (para 107). Their Honours considered, however,
that there was no scope for such a tort to be developed
in respect of corporations, such as Lenah (para 132).

Because of the decision he reached with respect to the
power of a court to grant an interlocutory injunction,
Kirby J considered it unnecessary to decide whether a
tort of invasion of privacy existed. He acknowledged
that there is doubt as to whether any right to privacy
could be enjoyed by a corporation (para 190).

Callinan J tentatively expressed the view that Victoria
Park was distinguishable from this case and was,
in any event, unlikely to apply in a case in which
there has been physical interference with a plaintiff's
property (paras 313-320). He considered that the time
was ripe for consideration of whether a tort of invasion
of privacy should be recognised (para 335). Further,
he did not rule out that in some circumstances a corporation
might be able to enjoy the same or similar rights to
privacy as a natural person (para 328). However, because
of the decision he reached with respect to the power
of a court to grant an interlocutory injunction, he
found it unnecessary to deal with these issues.

Government information

Gummow and Hayne JJ (with whom Gaudron J agreed) considered
that this appeal did not provide any occasion to reconsider
the outcome in Commonwealth v John Fairfax & Sons
Ltd (1980) 147 CLR 39 (a case in which Mason J held
that the unauthorised disclosure of government confidential
information will be restrained only if it appears that
the disclosure will be contrary to the public interest
because national security, relations with foreign countries
or the ordinary business of government will be prejudiced).
They endorsed Mason J's view that when equity protects
government information 'it will look at the matter through
different spectacles' (para 137).

Kirby J also expressed the view that different considerations
govern the provision of injunctive relief where the information
in question concerns the activities of public bodies
or governmental information (para 181).

Callinan J, however, tentatively expressed the view
that, notwithstanding the decision in Fairfax, he
would not rule out the possibility that a government
or a governmental agency may enjoy a right to privacy
over and above a right to confidentiality in respect
of matters relating to foreign relations, national security
or the ordinary business of government (para 328).

Text of the decision is available at: http://www.austlii.edu.au/au/cases/cth/high_ct/2001/63.html

Contacts for further information:

Jenny Burnett
Senior Executive Lawyer

Tel: (02) 6253 7012
Fax: (02) 6253 7303
E-Mail: jenny.burnett@ags.gov.au

Anna Lukeman
Senior Lawyer

Tel: (02) 6253 7142
Fax: (02) 6253 7303
E-Mail: anna.lukeman@ags.gov.au

Determining Whether a Duty of Care Exists

Two jointly decided appeals would seem the culmination
of a reassessment by the High Court in recent years
of the approach which should be taken in determining
whether a duty of care under the law of negligence
exists in a new category of circumstance.

The Court held that medical practitioners and social
workers on the staff of a sexual assault unit in a
hospital, as well as State government community welfare
officers, in carrying out an investigation pursuant
to statutory powers in a case of suspected child sexual
abuse, did not owe a duty of care to a person under
investigation (being in each case here the father of
the child) to take reasonable steps to safeguard that
person from nervous shock or psychiatric injury as
a consequence of being a subject of investigation.

In neither case here did the investigation undertaken
result in any successful prosecution or other action
against the plaintiff father (though in one case a
prosecution was instituted but later abandoned).

Sullivan v Moody, State of South Australia and Ors;
Thompson v Connon, State of South Australia and Ors

High Court of Australia, 11 October 2001
[2001] HCA 59; (2001) 183 ALR 404

Background

Part IV of the Community Welfare Act 1972 (SA)
deals with support services for children. Under s.92(1)
of Part IV, any person having the care of a child who
maltreats the child is guilty of an offence punishable
by fine or imprisonment. Under s.91(1) in the same Part,
certain classes of person (specified in s.91(2)), including
medical practitioners and hospital social workers, are
required to notify an officer of the State Department
of Community Welfare where he or she suspects on reasonable
grounds that an offence under Part IV has been committed.
Subsection 91(5) provides that, where a person acts in
good faith and in compliance with the provisions of s.91,
he or she incurs no civil liability in respect of that
action.

In Sullivan, the plaintiff sued:

  • a medical practitioner working in
    a hospital sexual assault unit, who, upon examination
    of the plaintiff's daughter, formed the view that the
    daughter had been sexually abused
  • two social workers employed by hospitals
    involved in the assessment of assault allegations in
    respect of the daughter, and
  • those hospitals and, in the alternative,
    the State of South Australia, as being vicariously
    liable for the alleged negligence of the medical practitioner
    and that of the two social workers.

In addition, it was alleged against the State that it
was negligent on its own account in the investigation
of the suspected child abuse against the daughter. The
plaintiff alleged negligence in the investigation, causing
him nervous shock and psychiatric injury, which, among
other things, led to the breakdown of his marriage. No
criminal charges were laid against the plaintiff, but
he alleged that this not dispel suspicion on the part
of his wife that he was responsible for the sexual abuse
of the daughter.

In Thompson, the facts were similar to Sullivan. The
plaintiff sued:

  • two medical practitioners working
    in the same sexual assault unit as was involved in
    Sullivan, who had between them examined each of the
    plaintiff's three sons and formed a suspicion that
    each had been the victim of sexual abuse
  • the hospital operating the sexual
    assault unit and
  • the State of South Australia. The
    plaintiff alleged that either the hospital or the State
    was vicariously liable for the negligence of the two
    medical practitioners.

In addition, it was alleged that the State was liable
for negligent acts and omissions on the part of certain
officers of the Department of Community Welfare affecting
the conduct of the investigation (though none of those
officers was sued individually). The plaintiff alleged
negligence in the investigation causing him nervous shock
and psychiatric injury. The State Police laid sexual
assault charges against the plaintiff in respect of the
matter, but later dropped them.

In each case, in an action in the Supreme Court of South
Australia, the plaintiff alleged that the defendant medical
practitioners and social workers and the officers of
the Department of Community Welfare (in respect of whom
the State was sued) owed a duty of care to carry out
their duties and responsibilities, particularly the investigation
of the sexual assault allegations, with due care.

Each appeal arose from the striking out by a master
of the Supreme Court of the plaintiff's statement of
claim as disclosing no reasonable cause of action. In
each case, it was held that no duty of care of the type
alleged could arise on the facts pleaded in the statement
of claim. The Full Court of the Supreme Court of South
Australia dismissed an appeal against the master's decision
in each case. Each plaintiff was granted special leave
to appeal to the High Court against the Full Court's
orders.

The High Court, sitting five justices, dismissed each
appeal with costs.

The High Court's Decision

The High Court (Gleeson CJ, Gaudron, McHugh, Hayne and
Callinan JJ), in a joint judgment, observed that the
argument of the plaintiffs was conducted on the basis
that the harm which they had suffered was a foreseeable
consequence of a want of care by those investigating
the alleged sexual abuse of the children concerned. However,
the Court said that this of itself was not sufficient
to attract a duty of care. If it were, the Court said
(at para 42):

at least two consequences would follow.
First, the law would subject citizens to an intolerable
burden of potential liability and constrain their freedom
of action in a gross manner. Secondly, the tort of negligence
would subvert many other principles of law and statutory
provisions, which strike a balance of rights and obligations,
duties and freedoms.

The Court looked to the question of what else must be
present to attract a duty of care. Referring to the well
known speech of Lord Atkin in Donoghue v Stevenson [1932]
AC 562, the Court noted that Lord Atkin himself commented
how difficult it was to find in the authorities statements
of general application defining the relations between
parties that give rise to a duty of care (see p. 579).

The Court said that, while the circumstances in which
a duty of care arose had been sometimes depicted as involving
a relationship of sufficient proximity between plaintiff
and defendant, the notion of 'proximity' itself was not
a formula for determining whether a duty of care comes
into existence. The Court said (at para 48):

Notwithstanding the centrality of that
concept [i.e. proximity], for more than a century, in
this area of discourse, and despite some later decisions
in this Court which have emphasised that centrality,
it gives little practical guidance in determining whether
a duty of care exists in cases that are not analogous
to cases in which a duty has been established. It expresses
the nature of what is in issue, and in that respect gives
focus to the inquiry, but as an explanation of a process
of reasoning leading to a conclusion its utility is limited.

The Court said that the three-stage approach of Lord
Bridge of Harwich in Caparo Industries Plc v Dickman [1990]
2 AC 605, at pp. 617-8, for determining whether a duty
of care came into existence (i.e. (i) reasonable foreseeability
of loss or injury; (ii) sufficient proximity of relationship,
and (iii) is it fair, just and reasonable to impose a
duty of care) does not represent the law in Australia.
The Court said that 'the question of what is fair, and
just and reasonable is capable of being misunderstood
as an invitation to formulate policy rather than to search
for principle' (see para 49).

The Court referred with approval to the statement of
Lord Diplock in Dorset Yacht Club v Home Office [1970]
AC 1004 that 'the judicial development of the law of
negligence rightly proceeds by seeking first to identify
the relevant characteristics that are common to the kinds
of conduct and relationship between the parties which
are involved in the case for decision and the kinds of
conduct and relationships which have been held in previous
decisions of the courts to give rise to a duty of care
(see p. 1058)'. The Court went on to say (at para 53):

Developments in the law of negligence
over the last 30 or more years reveal the difficulty
of identifying unifying principles that would allow ready
solution of novel problems. Nonetheless, that does not
mean that novel cases are to be decided by reference
only to some intuitive sense of what is "fair" or "unfair".
There are cases, and this is one, where to find a duty
of care would cut across other legal principles as to
impair their proper application and thus lead to the
conclusion that there is no duty of care of the kind
asserted.

The Court observed that the duty of care claimed by
the plaintiffs here, in so far as it would potentially
affect the publication of allegations adverse to the
plaintiffs in the course of the sexual assault investigations,
intersected with the law of defamation. The Court said
that to apply the law of negligence to the aid of the
plaintiffs here would 'allow recovery of damages for
publishing statements to the discredit of a person where
[having regard to defences under the law of defamation
such as qualified privilege] the law of defamation would
not (see para 54).'

The Court referred to the House of Lords decision in Hill
v Chief Constable of West Yorkshire [1989] AC 53
where it was held that, given the issues of policy
and discretions that apply in the management of police
operations and resources, it would have been inappropriate
to impose upon police officers a duty of care to members
of the public for loss or injury suffered though failure
to apprehend a dangerous criminal. The Court also referred
to the more recent statement of Lord Browne-Wilkinson
in X (Minors) v Bedfordshire County Council [1995]
2 AC 633, at p. 750, where he said that, if liability
in damages were to be imposed in the circumstances
of a local government authority and its servants performing
statutory functions for the well-being of children,
it may cause the local authorities to become more cautious
and defensive in a way which could rebound to the disadvantage
of the children being sought to be protected.

The Court said (at para 60):

The circumstance that a defendant owes
a duty of care to a third party, or is subject to statutory
obligations which constrain the manner in which powers
or discretions may be exercised, does not of itself rule
out the possibility that a duty of care is owed to a
plaintiff. People may be subject to a number of duties,
at least provided they are not irreconcilable.

The Court went on to consider the statutory scheme in
the present case and said (at para 62):

It would be inconsistent with the proper
and effective discharge of those responsibilities [borne
by the defendants in the present cases under the statutory
scheme] that they [the defendants] should be subjected
to a legal duty, breach of which would sound in damages,
to take care to protect persons who were suspected of
being the sources of that harm. The duty for which the
[plaintiffs] contend cannot be reconciled satisfactorily,
either with the nature of the functions being exercised
by the [defendants], or with their statutory obligation
to treat the interests of the children as paramount.

The Court said that the 'logical consequence of the
[plaintiffs'] argument must be that a duty of care is
owed to anyone who is, or who might become a suspect'
(see para 63). Once one rejects in the context of who
may be a suspect for investigation a distinction between
parents and everyone else, there was no relationship,
association, or connection between the plaintiffs and
the defendants here, other than that the plaintiffs were
suspects for the child sexual abuse under investigation.

The Court concluded (at para 64): 'Ultimately, [the
plaintiffs'] case rests on foreseeability; and that is
not sufficient'. Accordingly, the Court held that the
duty of care for which the plaintiffs argued did not
exist.

Text of the decision is available at: http://www.austlii.edu.au/au/cases/cth/high_ct/2001/59.html

Contact for further information:

Paul Sykes
Senior Lawyer

Tel: (02) 6253 7050
Fax: (02) 6253 7302
E-Mail: paul.sykes@ags.gov.au

High Court Decisions in Brief

Regie National des Usines Renault SA v Zhang
14/3/02, [2002] HCA 10; (2002) 187 ALR 1

In this appeal the High Court changed the choice of
law rules that apply to international torts (ie torts
occurring in a foreign country but litigated in an Australian
court). The case arose out of injuries to a NSW resident
in an accident in New Caledonia involving a Renault car.
The NSW resident brought proceedings in the NSW Supreme
Court against two Renault companies (which had no presence
in Australia) alleging negligence in the design of the
motor vehicle. The question was whether the action should
be stayed on the basis that NSW was an 'inappropriate
forum'. This involved, in part, consideration of which
law should be applied by the NSW Supreme Court in determining
the action.

In John Pfeiffer Pty Ltd v Rogerson (2000) 203
CLR 503, the High Court changed the common law choice
of law rules for intra-Australian torts, to which Australian
courts now apply the substantive law of the State or
Territory in which the tort occurred (rather than the
substantive law of the State or Territory in which the
proceedings are brought). In Renault, the High
Court decided to extend this approach to foreign torts
so that, in general terms, Australian courts should now
apply the substantive law of the place where the tort
occurred. Further, an Australian court would not be an
inappropriate forum for a tort action merely because
it would be required to apply foreign law; a proceeding
should only be stayed if it would be oppressive or vexatious,
and so productive of injustice, to hear the claim in
the Australian court. However, the High Court reserved
some matters for further consideration, such as the position
of maritime and 'aerial' torts and the law which should
be applied to assessment of damages.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/10.html

Pasini v United Mexican States
reasons published 14/2/02, [2002] HCA 3; (2002) 187 ALR 409

The High Court upheld the constitutional validity of
the appeal provision in s.21 of the Extradition Act
1988 (Cth), ruling that it did not invalidly confer
an administrative function on the Federal Court.

A magistrate, acting administratively, determined that
the applicant was eligible for surrender under the Extradition
Act. Section 21 allowed an appeal against this determination
to the Federal Court. The applicant challenged the constitutional
validity of the Act, including on the ground that the
appeal provision conferred non-judicial power on the
Federal Court contrary to Chapter III of the Constitution.

In upholding the validity of s.21, the High Court followed
the long-standing line of authorities which establish
that there are some powers which appropriately may be
treated as administrative when conferred on an administrative
body and judicial when conferred on a court (the 'chameleon
doctrine'). The decision affirms that the Parliament
has flexibility in implementing schemes for conferring
dispute resolution functions on administrative tribunals.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/3.html

Re McBain; Ex parte Australian Catholic Bishops
Conference
Re McBain; Ex parte Attorney-General of the Commonwealth Ex rel Australian
Episcopal Conference of the Roman Catholic Church
18/4/02, [2002] HCA 16; (2002) 188 ALR 1

The High Court dismissed the applications brought by
the Catholic Bishops to overturn the judgment of the
Federal Court in McBain v Victoria that the Infertility
Treatment Act 1995 (Vic) is inconsistent with the Sex
Discrimination Act 1984 (Cth) and invalid to the
extent that it precludes a single woman from receiving
IVF treatment in Victoria.

The Court delivered 6 separate judgments. (Gaudron and
Gummow JJ gave a joint judgment.) None of the members
of the Court dealt with the substantive issues which
the Bishops had sought to raise. Gleeson CJ noted that
cogent arguments were presented each way as to whether
the Infertility Treatment Act was inconsistent with the
Sex Discrimination Act. Callinan J doubted the assumption
of all parties to the case that the Sex Discrimination
Act is a law with respect to external affairs supported
by s.51(xxix) of the Constitution.

The proceedings were disposed of on issues of jurisdiction
and discretion. Sections 75 and 76 of the Constitution
confer, or provide for the Commonwealth Parliament to
confer, original jurisdiction on the High Court in specified
'matters'. Gleeson CJ and Gaudron and Gummow JJ (with
whom Hayne J agreed on this issue) held that there was
no 'matter' before the Court in either the relator proceeding
for which the Commonwealth Attorney-General had granted
his fiat or the Bishops' own application and the High
Court therefore did not have jurisdiction to determine
the proceedings. McHugh, Kirby and Callinan JJ held that
there was a matter before the Court but would have refused
the relief sought as a matter of discretion.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/16.html

SGH Ltd v Commissioner of Taxation
reasons published 1/5/02, [2002] HCA 18; (2001) 188 ALR 241

SGH Ltd was assessed to tax under the Income Tax
Assessment Act 1936 (Cth) on certain payments it
received under Queensland legislation. SGH Ltd is a
building society in Queensland formed under the Building
Societies Act 1886 (Qld) and controlled by Suncorp,
a statutory corporation established by a Queensland
Act. It was common ground that Suncorp was 'the State'
for the purposes of s 114 of the Constitution (which
prohibits the Commonwealth from imposing 'any tax on
property of any kind belonging to a State'). SGH Ltd
argued that it was also 'the State' for the purposes
of s.114 and that imposition of the tax would constitute
a tax on property of a State contrary to s.114. The
High Court decided that SGH Ltd was not 'the State'
for the purposes of s.114. It was significant to this
decision that SGH Ltd had as members individual depositors,
not being the State, whose interests had to be taken
into account in its decision-making.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/18.html

Roxborough v Rothmans of Pall Mall Australia Ltd
6/12/01, [2001] HCA 68; (2001) 185 ALR 335

This appeal dealt with the restitutionary principles
that apply where a business tax is held to be invalid,
after the amount of the tax has been passed on to consumers.
In 1997 the High Court ruled that the NSW business franchise
tax imposed on sellers of tobacco products was invalid
under s.90 of the Constitution (which gives to the Commonwealth
exclusive power to impose excise duties). As a result,
the wholesaler Rothmans was not required to pay the amount
of the tax to NSW. However, the retailers had paid the
amount of the tax to the wholesaler and had passed it
on to consumers. The retailers sued the wholesaler for
the amount of the tax they had paid to it. The High Court
held that the retailers were entitled, in restitution,
to be repaid by the wholesaler the amount of tax they
had paid to it.

http://www.austlii.edu.au/au/cases/cth/high_ct/2001/68.html

Cheung v The Queen
22/11/01, [2001] HCA 67; (2001) 185 ALR 111

The High Court affirmed that it is the role of the trial
judge to determine the facts relevant to sentencing in
a criminal matter, including in Commonwealth prosecutions.
The appeal raised the application of s.80 of the Constitution
(which requires that the trial on indictment of Commonwealth
offences be by jury) in the context of the sentencing
process in which the judge may make findings of fact
relevant to the level of penalty to be imposed. The High
Court ruled that in sentencing, the judge may not find
as proven facts which would be inconsistent with factual
implications of the jury's verdict (eg as to the establishment
of elements of the offence), but there is no requirement
that the judge sentence a person on the basis of the
view of the facts most favourable to the person consistent
with the verdict. Section 80 does not require a different
approach for Commonwealth offences. The decision affirms
that s.80 does not require different sentencing procedures
for Commonwealth and State offences.

http://www.austlii.edu.au/au/cases/cth/high_ct/2001/67.html

Wong v The Queen; Leung v The Queen
15/11/01, [2001] HCA 64; (2001) 185 ALR 233

In this appeal, the High Court decided that the NSW
Court of Criminal Appeal could not give 'guideline judgments'
for sentencing for Commonwealth offences.

In the course of determining the appropriate sentence
to be imposed in these cases, the NSW Court of Criminal
Appeal had issued a 'guideline judgment' concerning sentencing
for heroin importation and related offences under the Customs
Act 1901 (Cth). The judgment set out comprehensive
quantitative but non-binding guidelines for the ranges
of appropriate sentences assessed against specified factors
(in particular, the amount of heroin). The High Court
decided that the sentencing process undertaken by the
NSW Court of Criminal Appeal was inconsistent both with
general sentencing principles and with s 16A of the Crimes
Act 1914 (Cth) (which deals with sentencing for Commonwealth
offences). This was because the 'guideline judgment'
focussed on the result of the sentencing task and not
on the principles supporting the result.

http://www.austlii.edu.au/au/cases/cth/high_ct/2001/64.html

Shergold v Tanner
23/5/02, [2002] HCA 19; (2002) 188 ALR 302

The High Court held that a decision to issue a conclusive
certificate which has the effect of denying access to
documents under the Freedom of Information Act 1982 (Cth)
is judicially reviewable. Mr Tanner MP sought Administrative
Appeals Tribunal review of a decision of a delegate of
the then Department of Employment, Workplace Relations
and Small Business (DEWRSB) to exempt consultants' reports
relating to waterfront reform issues from release under
the FOI Act. Subsequent to the application to the AAT,
Dr Shergold (then Secretary of DEWRSB), as delegate of
the Minister, issued conclusive certificates under the
FOI Act concerning the effect of disclosure on the Commonwealth's
relations with the States and on the public interest.
Mr Tanner sought judicial review in the Federal Court
of the decisions to issue the certificates. The Federal
Court held at first instance and, by majority, on appeal
that the decisions were, on the grounds pleaded, judicially
reviewable. The High Court agreed, ruling that while
the certificates remained in force they were conclusive
within the context of the FOI Act, but this did not preclude
judicial review of the decision to grant them.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/19.html

Mobil Oil Australia Ltd v Victoria
26/6/02, [2002] HCA 27; (2002) 189 ALR 161

The High Court upheld the validity of Part 4A of the Supreme
Court Act 1986 (Vic) which provides for representative
actions in the Victorian Supreme Court. The Victorian
legislation substantially mirrors the 'group proceedings'
provisions of Part IVA of the Federal Court of Australia
Act 1976, the validity of which has also been challenged.
This case arose out of a product liability claim brought
against the plaintiff involving the production of allegedly
contaminated aviation fuel in Victoria and its subsequent
supply in Victoria and other States.

The High Court rejected arguments that the Victorian
provisions exceed territorial limitations on the legislative
power of the Victorian Parliament in their operation
on group members resident outside Victoria and that the
provisions contravene requirements in Chapter III of
the Constitution for the proper exercise of judicial
power. The Court affirmed that Chapter III of the Constitution
does not require that a State Supreme Court exercise
only judicial powers. In any event, proceedings under
Part 4A involved the exercise of judicial power.

http://www.austlii.edu.au/au/cases/cth/high_ct/2002/27.html

Contact for further information:

David Bennett
Deputy Government Solicitor

Tel: (02) 6253 7063
Fax: (02) 6253 7303
E-mail: david.bennett@ags.gov.au

For further information on litigation
matters and services please contact:

Canberra
Jenny
Anderson

(02) 6253 7401

New South Wales
Julia Hall

(02) 9581 7432

Victoria
Stephen
Lucas

(03) 9242 1200

Queensland
Maurice
Swan

(07) 3360 5702

Western Australia
Graeme
Windsor

(08) 6268 1102

South Australia
David
Williams

(08) 8205 4283

Northern Territory
Jude Lee

(08) 8943 1444

Tasmania
Peter Bowen

(03) 6220 5474

ISSN 1329-458X (Print)
ISSN 2204-6542 (Online)

For assistance with supply of copies, change of address
details etc Tel: (02) 6253 7052, Fax: (02) 6253 7313,
E-mail: ags@ags.gov.au.

The material in these notes is provided
for general information only and should not be relied
upon for the purpose of a particular matter. Please
contact AGS before any action or decision is taken
on the basis of any of the material in these notes.

Back to Litigation
Notes Index