(Other than Applications for Special Leave to Appeal)
AUGUST/SEPTEMBER 2000
AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION v. EDENSOR NOMINEES PTY LTD & ORS (M20/2000)
EDENSOR NOMINEES PTY LTD v. AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION & ORS (M23/2000)
YANDAL GOLD PTY LTD & ORS v. AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION & ANOR (M24/2000)
Court appealed from: Full Federal Court of Australia
Date of judgment: 9 March 2000
Date referred to Full Bench: 18 April 2000
RE EDENSOR NOMINEES PTY LTD & ORS; EX PARTE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION (M35/2000)
RE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION & ORS; EX PARTE EDENSOR NOMINEES PTY LTD (M38/2000)
RE AUSTRALIAN SECURITIES AND INVESTMENTS COMMISSION & ORS; EX PARTE YANDAL GOLD PTY LTD & ORS (M39/2000)
Order nisi applications
On 12 January 1999 Yandal Gold Pty Ltd ("Yandal Gold") made a formal takeover offer of $1.50 per share on Great Central Mines Ltd ("GCM"), a company listed on the Stock Exchange. Yandal Gold was a wholly owned subsidiary of Yandal Gold Holdings Ltd ("Yandal Gold Holdings"). The shares in Yandal Gold Holdings were owned as to 50.1% by Edensor Nominees Pty Ltd ("Edensor") and as to 49.9% by Normandy Consolidated Gold Holdings Pty Ltd ("Normandy Consolidated Gold"). Edensor held the shares in Yandal Gold Holdings as a trustee of a discretionary trust for the benefit of the Gutnick family. Normandy Consolidated Gold, Normandy Mining Holdings Pty Ltd ("Normandy Mining Holdings") and Normandy Mining Finance Ltd were subsidiaries of the ultimate holding company of the Normandy group, Normandy Limited ("Normandy"), a company also listed on the Stock Exchange.
At that time Yandal Gold had a "relevant" interest in 43% of the issued shares in GCM. The interest arose as a result of a Shareholders Agreement entered into on 11 January 1999 between all of the companies named in these proceedings. Prior to that agreement Yandal Gold and Yandal Gold Holdings held no shares in GCM. Upon entering into the Agreement, Edensor's interest in GCM increased from 12.56% to 40.37% and the Normandy group's entitlement increased from 27.81% to 40.37%. Immediately after the closure of takeover offers, Yandal Gold had become entitled to 94.37% of the issued shares in GCM (of which 40.37% related to the shares held by Normandy Mining Holdings and Edensor).
From an early stage of the takeover, Australian Securities and Investments Commission ("ASIC") was concerned about the consequences of the Shareholders Agreement. ASIC's concern was that, as a result of the takeover being launched by Yandal Gold from a "platform" of 40.37%, there was no realistic prospect of a rival bid and either no (or an inadequate) premium for control was being offered to shareholders in GCM, who were not being paid a fair or reasonable price for their shares. ASIC's investigations resulted in proceedings being commenced in the Federal Court. ASIC contended that as a result of the Shareholders Agreement, Yandal Gold, Yandal Gold Holdings, Edensor and certain companies in the Normandy Group were deemed to have relevant interest in the shares held by Edensor and Normandy Mining Holdings in GCM under s33 of the Corporations Law and had acquired the relevant interest in respect of those shares in contravention of s615 of the Corporations Law. ASIC sought relief including the making of orders under ss737 and 739 of the Corporations Law. Subsequently ASIC amended its application to seek further relief based on its contention that the making and dispatch of the takeover offers contravened s12DA of the Australian Securities and Investments Commission Act 1989 (Cth) (the "ASIC Act"), s995(2)(b) of the Corporations Law and/or s52 of the Trade Practices Act 1974 (Cth) (the "TP Act").
Merkel J was of the view that there had been breaches of s615 of the Corporations Law, as well as s52 of the TP Act or alternatively s12DA of the ASIC Act and s995(2)(b)(iii) of the Corporations Law. Merkel J gave judgment in favour of ASIC and made orders and declarations accordingly, including an order requiring Edensor to pay to ASIC $28.5 million for payment by ASIC pro-rata to shareholders in GCM. The order for payment was made pursuant to s737 or 739 of the Corporations Law. Edensor appealed to the Full Court. Edensor paid the amount of $28.5 million into court pending hearing and determination of the appeal.
A preliminary point arose on the appeal as a result of the High Court decision in Re Wakim. It was submitted that as a consequence of Re Wakim, to the extent that the orders and declarations made by Merkel J were made under the Corporations Law, he had no power to make them. The Full Court agreed with Merkel J that there was a common substratum of fact which conferred on the Federal Court jurisdiction to decide the whole "matter", the whole controversy between the parties (the accrued jurisdiction). However the Full Court found that the powers could not be exercised by the Federal Court because the State of Victoria could not, by the Corporations (Victoria) Act 1990 (Vic) give to the Federal Court jurisdiction to exercise the jurisdiction of the State of Victoria, following Re Wakim. The Court concluded that the exercise of powers under the Corporations Law was restricted, by the definition of "court" in S58AA of the Corporations Law, to the Federal Court when exercising the jurisdiction of the State of Victoria. The Full Court concluded that s58AA in substance precluded the existence in the accrued jurisdiction of any matter under the Corporations Law.
The Full Court delivered its judgment on 10 December 1999, but had sought further submissions from the parties as to the orders to be made. The Federal Courts (State Jurisdiction) Act 1999 (Vic) (the "State Jurisdiction Act") came into effect on 15 December 1999. In a further judgment delivered on 9 March 2000, the Full Court held that the order for payment made by Merkel J was invalid for want of jurisdiction and that it constituted an "ineffective judgment" within the meaning of s4(1) of the State Jurisdiction Act. Under that Act an ineffective judgment is to be treated as a judgment of the Supreme Court. The Full Court was of the view that the future course of the proceedings ought to be dealt with by the Supreme Court of Victoria.
The questions of law said to justify the grant of special leave in M20/00 include:
- Did the Federal Court of Australia have accrued jurisdiction to hear and determine the claims for relief under ss737 and 739 of the Corporations Law of Victoria made by the Australian Securities and Investments Commission, or another applicant; and
Did the Federal Court have original jurisdiction pursuant to ss39B(1A)(a) or (c) of the Judiciary Act 1903 (Cth) to hear and determine a claim for relief under ss737 and/or 739 made by ASIC or another applicant.
The questions of law said to justify the grant of special leave in M23/00 include:
- Is the State Jurisdiction Act inconsistent with section 22 and/or section 24 of the Federal Court of Australia Act 1976 (Cth) if and insofar as the definition of "State matter" in the State Jurisdiction Act includes matters outside the exclusive jurisdiction of the Federal Court of Australia but within the accrued jurisdiction of that Court.
The questions of law said to justify the grant of special leave in M24/00 include:
- Was order 7 [ordering payment of the $28.5 million] made by Merkel J:
a) made in a State matter as defined in the Federal Courts (State Jurisdiction) Act 1999 (Vic); and
b) an ineffective judgment as defined in the State Jurisdiction Act.
All three applications for special leave to appeal were heard on 18 April 2000. Gaudron and Hayne JJ made orders referring the three applications for special leave to an expanded Full Court. At the same time directions were given which resulted in each of the three applicants for special leave applying for prerogative relief, by way of mandamus and certiorari, in respect of the orders made by the Full Federal Court on 9 March 2000. The applications for prerogative relief came before Hayne J on 28 April 2000 who directed that each application for prerogative relief be made by notice of motion to the same Full Court that would be determining the special leave applications.
Notices of constitutional matters have been given. The Commonwealth, Victoria, Western Australia, South Australia and New South Wales will be intervening.
BRODIE & ANOR v. SINGLETON SHIRE COUNCIL (S44/1999)
Court appealed from: Supreme Court of NSW, Court of Appeal
Date of judgment: 6 March 1999
Date referred to Full Bench: 10 December 1999
This case concerns injuries to users of highways and liability of highway authorities and the distinction between nonfeasance and misfeasance.
The applicants sought to recover from the respondent damages in respect of injuries and losses sustained as a result of the respondent's negligence. On 19 August 1992 the first applicant drove a fully laden truck onto a wooden bridge (Forresters Bridge) in the Singleton area. The bridge which was at least 50 years old collapsed. The first applicant suffered injuries and the truck sustained damage.
At trial the applicants sought to advance a case of misfeasance. The basis for such a case was that, as over the years it had taken steps to replace defective decking planks, the Council became subject to a duty to repair the whole bridge; that, by not doing so, the Council had created a danger in the highway and thus was guilty of misfeasance. Tapsell DCJ held that the case was not a case of nonfeasance (which would have meant that the respondent was not liable) but rather of misfeasance and found a verdict and awarded damages for the applicants.
The Court of Appeal allowed the respondent's appeal, finding that the primary judge was in error in his finding that the respondent was liable on the grounds of misfeasance.
The States of Victoria, Western Australia and New South Wales are seeking leave to intervene and make submissions.
Questions of law said to justify the grant of special leave to appeal are:
- Whether the defence of nonfeasance is available to highway authorities. The case concerns a wooden bridge in the Singleton area which collapsed when the applicant drove a fully laden concrete truck onto it; its girders on which the planks were laid were badly "piped"; and
- Whether, if the defence of nonfeasance is available to highway authorities, the Court of Appeal applied the wrong test in finding that the respondent was not guilty of misfeasance because the replacing of planks on the surface of the bridge was only "superficial repairs to the road surface" (para 46). The planks which made up the surface were the functional part of the bridge and were not to be equated with filling in a hole in the surface of a road as in Gorringe v. The Transport Commission (Tas) (1950) 80 CLR 357.
GHANTOUS v. HAWKESBURY CITY COUNCIL (S69/1999)
Court appealed from: Supreme Court of NSW, Court of Appeal
Date of judgment: 14 April 1999
Date referred to Full Bench: 10 December 1999
This application concerns the misfeasance/nonfeasance rule and whether that rule extends to the nature strip beyond the footpath.
The applicant sought to recover from the respondent damages for injuries which she sustained in July 1990 when she fell while walking on a cement footpath in Kable Street, Windsor. The claim was founded in negligence. It was not disputed before the trial judge that the cement footpath in Kable Street was still in good condition, however it was clear that, at that time, the unsealed strips on each side of the footpath had become degraded, the strips being virtually denuded of grass, the surface of the strips being about 30 mm or so below the level of the cement, and the soil within each strip being uneven. The trial judge gave verdict for the respondent, holding that "it is regrettable that that Council's program of maintenance did not operate to keep the footpath in less hazardous condition but that failure to maintain is, by definition, nonfeasance. The Council enjoys immunity for nonfeasance and consequently the plaintiff fails."
The applicant appealed. The Court of Appeal dismissed the appeal. The Court found that the principle of immunity of a road authority in respect of nonfeasance remains part of the law of NSW, and that even though it has been suggested that there is doubt as to the extent to which this principle applies to foot or pathways as distinct from roadways, it concluded that the area beside the footpath was subject to the misfeasance/nonfeasance rule and that the Council's action or inaction amounted to nonfeasance and not misfeasance.
The States of Victoria, Western Australia and New South Wales are seeking leave to intervene and make submissions.
Questions of law said to justify the grant of special leave to appeal are:
- The Court of Appeal erred in extending the application of the misfeasance/nonfeasance rule from the "road surface proper" or "actual roadway itself" not merely to footpaths but to an area of nature strip beside the footpath said to be part of the road reserve;
- The Court of Appeal erred in concluding that the Respondent Council was not an active agent in creating, or adding to, an unnecessary danger; and
- The highway immunity (misfeasance/nonfeasance) should not form part of the law in New South Wales. The appellant requires leave to argue this point in the light of the High Court decisions in Buckle v. Bayswater Road Board (1936) 57 CLR 259 and Gorringe v. The Transport Commission (Tas) (1950) 80 CLR 357.
DURHAM HOLDINGS PTY LIMITED v. THE STATE OF NEW SOUTH WALES (S155/1999)
Court appealed from: Supreme Court of NSW, Court of Appeal
Date of judgment: 8 September 1999
Date referred to Full Bench: 10 March 2000
This application raises substantial questions as to the legislative power of the State Parliament. The applicant seeks to have the decision of the Court of Appeal set aside and questions the validity of certain sections of the Coal Acquisition Act 1981 (NSW) [the "CAA"] and Coal Acquisition (Compensation) Arrangements 1985 (NSW) [the "CACA"] as amended. The applicant also questions the Court of Appeal's approach to the construction of this legislation.
The applicant is incorporated in New South Wales. In 1969 and 1974 it bought certain coal deposits in NSW to mine. On 18 December 1981 the NSW legislature enacted the CAA to create an expropriation and compensation regime. The relevant sections came into force on 1 January 1982. In June 1985 the Coal Compensation Board [the "CCB"] was established for the purpose of determining claims for compensation after the expropriation of coal under the CAA. The applicant lodged a claim in April 1986 for compensation.
On 22 June 1990 the Coal Acquisition (Amendment) Act 1900 NSW [the "CAAA"] came into force. It added a new s6(3) to the CAA to provide a limit or 'cap' to compensation payments. A new subclause 22AA(3) was added to the CACA which purported to place a limit of $23,250,000 plus interest on compensation payable to the applicant, irrespective of the amount of compensation to which it would otherwise be entitled.
On 22 August 1997 the CCB decided the applicant's claim. It assessed that the applicant was entitled to a total amount of $93,397,327, however, the CCB applied the 'cap' in cl 22AA(3) of the CACA to determine that the applicant was entitled to no further compensation than that paid in interim payments totalling $27,006,254. The applicant then appealed to the Coal Compensation Review Tribunal and commenced proceedings in the Administrative Law Division of the Supreme Court which were removed into the Court of Appeal.
On 8 September 1999 the Court of Appeal dismissed the proceedings.
Firstly, the Court of Appeal rejected the applicant's proposition that by reason of s30 of the Interpretation Act 1987 (NSW) subcl 22AA did not apply to the applicant's pending claim for compensation since a contrary intention appeared in the Act and the Arrangements. Secondly, the Court of Appeal held that the presumption that the legislature does not intend to acquire property without compensation was rebutted by s6(3) of the CAA. Thirdly, the Court of Appeal rejected the claim that s6(3) of the CAA was inconsistent with s10 of the Racial Discrimination Act 1975 (Cth). Fourthly, the Court of Appeal rejected the claim that s6(3) of the CAA was beyond the power of the NSW Parliament on the ground that it purported to deprive named persons of their property without just, or any properly adequate, compensation. The Court relied chiefly on the statements of the High Court in Mabo v. Queensland (1986) 166 CLR 186 and Teori Tau v. Commonwealth (1969) 119 CLR 564.
A notice of constitutional matter has been filed and the Commonwealth and the States of Victoria, Queensland, Western Australia and South Australia have intervened.
Questions said to merit the grant of special leave to appeal are:
- Whether s6 of the Coal Acquisition Act 1981 (NSW) as amended rebuts the presumption that the legislature does not intend to acquire property without compensation; and
- Whether the Legislature of NSW has the power to acquire property from named parties without compensation.
STANOEVSKI v. THE QUEEN (S251/1999)
Court appealed from: Supreme Court of NSW', Court of Criminal Appeal
Date of judgment: 24 February 1998
Date of grant of special leave: 10 December 1999
The appellant, a solicitor, pleaded not guilty to a charge of conspiracy to cheat and defraud. She was convicted and sentenced to a fixed term of imprisonment of 9 months to be served by way of home detention.
The Crown case was that on 21 January 1993 the appellant approached her secretary, Glory Wailes, and an agreement was made between them for Ms Wailes to arrange for someone to take the appellant's BMW motor vehicle so that the appellant could make a claim on NRMA Insurance Limited. Ms Wailes approached a Robert White who agreed to take the car and arrangements were made for him to remove it from Jacob Street, Bankstown on 4 February 1993.
At the trial the principal witness against the appellant was the co-conspirator, Ms Wailes. Some time before the trial, Ms Wailes had made an allegation to the Law Society alleging that the appellant had forged the signature of a client to an affidavit in certain court proceedings, and had also purported to witness the client's signature. (The alleged forgery was unrelated to the charge on which the appellant stood trial). The Law Society had conducted an investigation into the matter. No charge was laid.
Trial counsel for the appellant sought from the trial judge an advance ruling as to whether, if he raised the issue of the appellant's good character, the Crown Prosecutor would be permitted to cross-examine the appellant about the alleged forgery. The trial judge indicated that he would be minded to permit such cross-examination. When the appellant came to her case she raised the issue of character, gave and called evidence of her good character and referred to the complaint to the Law Society (about which the jury had previously heard nothing). She was then cross-examined by the Crown Prosecutor. In due course the trial judge gave directions to the jury about the matter.
The Court of Criminal Appeal held that in the circumstances the cross-examination of the appellant was permissible, the trial did not become unfair and the trial judge's directions to the jury on the issue were appropriate.
The grounds of appeal are:
- The Court of Criminal Appeal erred in holding that the trial judge did not err in admitting evidence of bad character to rebut evidence of the appellant's good character; and
- The Court of Criminal Appeal erred in holding that the trial judge did not err in permitting cross-examination of the appellant regarding allegations made by Glory Mae Wailes to the Law Society of New South Wales.
RE THE MINISTER FOR IMMIGRATION AND MULTICULTURAL AFFAIRS OF THE COMMONWEALTH OF AUSTRALIA & ANOR; EX PARTE MIAH (S199/1999)
The prosecutor was born in Bangladesh on 29 September 1970. He arrived in Australia on 9 March 1996. On 1 April 1996 he lodged an application for a protection visa. The prosecutor claimed in his application that he feared serious harm at the hands of Muslim fundamentalists in Bangladesh because of his religious and political beliefs and because of his profession as a journalist. He claimed, inter alia, that he and his wife had each been publicly lashed 101 times. On 13 May 1997 the 2nd respondent (as delegate of the 1st respondent) rejected the application for a protection visa.
The delegate appears to have been satisfied that the prosecutor had a fear of persecution on the grounds identified within the Convention. The question he set out to answer was whether that fear was "well founded".
Three months after the application was lodged, a general election was held in Bangladesh as a result of which the Awami League took over government in place of the Bangladesh Nationalist Party ("the BNP") which had previously been in power. The delegate was of the view that the change in government was a critical factor in determining the fate of the prosecutor's application. The prosecutor had indicated that he had considered the Awami League and the BNP as having similar sympathies in relation to Jamat-i-Islam (the fundamentalist party). The delegate apparently took a different view on the basis of two documents identified in his reasons which were not supplied by the prosecutor. They were not made available to the prosecutor, nor was he advised of the possible adverse inferences that might be drawn from them.
The prosecutor argues that it is well established that the usual approach to determining whether Australia has protection obligations under the Convention Relating to the Status of Refugees is to identify the circumstances in which an applicant left his country of nationality. The prosecutor further argues that the failure to provide an opportunity to comment on the documentary material which proved critical to the prosecutor's case constitutes a contravention of procedural fairness.
On 23 May 1997 the prosecutor instructed his then solicitor to seek review of the decision by the Refugee Review Tribunal ("the Tribunal") and signed an application for review. In order to comply with s412 of the Migration Act 1958 (Cth) the application to the Tribunal should have been lodged by 11 June 1997. Due to the failure of the then solicitor to lodge the application as instructed, that was not done.
On 17 January 2000 McHugh J granted an order nisi.
MALIKA HOLDINGS PTY LTD v. STRETTON (M14/2000)
Court appealed from: Court of Appeal, Victoria
Date of judgment: 4 December 1998
Date special leave granted: 11 February 2000
The applicant claimed that goods imported into Australia in September 1986 were "handcrafted cotton garments", in which case no duty would have been payable. Duty would have been attracted if the garments were machine made. The Australian Customs Service ("Customs") decided to investigate handcraft importations, releasing the goods pending such investigation, after having taken samples for testing. Customs subsequently demanded payment of duty from the applicant. However Customs advised no further action would be taken pending the outcome of a test case in the Administrative Appeals Tribunal. After that case was determined, Customs made a formal demand to the applicant in April 1989. The applicant did not pay the duty on the basis that: the goods were handcrafted; the original letter stating that recovery action would not be taken was not a valid demand; and the subsequent letter of demand was outside the statutory 12 month period prescribed by s165 of the Customs Act 1901 (Cth) ("the Act").
The respondent, in her capacity as Regional Director of Customs, commenced proceedings in the Supreme Court to recover the customs duty of $44,540.77. A preliminary question came before Gray J to be determined as follows:
"Is the defendant entitled to dispute:
(a) the amount of duty;
(b) the rate of duty; or
(c) the liability of the goods the subject of the action to duty
where the defendant had neither:
(i) paid under protest pursuant to sub-section 167(1) of the Customs Act 1901 the sum demanded by the collector as the duty payable in respect of the goods; nor
(ii) brought an action pursuant to sub-section 167(2) of the Customs Act 1901 for recovery of the sum so paid?"
Gray J answered the preliminary question in the affirmative. The respondent appealed. The Court of Appeal answered the question in the negative and allowed the appeal. The Court held that those sections constituted an exclusive code for the challenging of assessments for customs duties.
The grounds of appeal include:
- The Court of Appeal erred in holding that s167 of the Customs Act 1901 (Cth) constituted the only means by which an importer may challenge the amount and rate of, and the liability of the goods to, customs duty; and
- The Court of Appeal erred in holding that s167 of the Customs Act 1901 (Cth), although in form permissive or facultative, is in effect peremptory or exclusive.