A New Province for Law and Order
A Constitutional Basis for the Federal Coalition's Industrial Relations Policy
The Federal Coalition's industrial relations policy
calls for a system of industrial relations radically
different from that which has existed in this country
in the past. In a paper delivered at a conference
of this Society in September 1991, Mr Greg Craven raised
the question whether the constitutional powers of the
Commonwealth would suffice for the implementation of
that policy. He came to the view that legislation
"will be attended by major constitutional difficulties",
which might not be insuperable, but which "are undeniably
grave". I have been invited to revisit that area for
you tonight. Your organisers having rejected my suggestion
that this was not a very gentlemanly thing to do to
people who have worked hard all day and have just had
a very pleasant dinner, I fear that I must do as I
B. Some Features of the Established Industrial Relations
Even in a gathering of people known to think about
little else than industrial relations systems, it is
convenient to call to mind certain facts concerning
the existing Commonwealth system.
- (1) The Commonwealth Parliament's principal power with
respect to industrial relations is that given by placitum
(xxxv) of s. 51 of the Constitution, to make laws "with
- "(xxxv) Conciliation and arbitration for the prevention
and settlement of industrial disputes extending beyond
the limits of any one State:".
- It is under that power that the existing system exists.
- (2) Placitum (xxxv) does not give the Parliament power
to legislate directly for the prevention and settlement
of industrial disputes. The power is to legislate
for conciliation and arbitration for such prevention
and settlement, so that what is done for prevention
and settlement of disputes is done by the conciliator
and arbitrator, not by a law passed by the Parliament.
The power is to create an agent having a power which
the principal does not.
- (3) Parliament exercised that power in enacting the
Conciliation and Arbitration Act 1904. The
Act's statement of its principal objects included the
establishment of a Court of Conciliation and Arbitration
"having jurisdiction for the prevention and settlement
of industrial disputes". The Court, supplemented by
Conciliation Commissioners, was to prevent and settle
disputes by conciliation and arbitration.
- (4) Following the decision of the High Court in R.
v Kirby; ex p. Boilermakers' Society of Australia
(The Boilermakers' Case) (1956) 94 C.L.R. 254,
the conciliation and arbitral functions of the Court
passed to a Conciliation and Arbitration Commission,
later transmuted to the Industrial Relations Commission:
see the Industrial Relations Act 1988. For
the purposes of this paper the variety of names is
irrelevant. What is said here as to the Court is true
as to the successive Commissions.
- (5) The power given to the Court by the words of pl.
(xxxv) as repeated in the legislation, turned out over
the years to be very wide. For a start, the "dispute"
was seen not as the strike (or other overt incident),
but as the underlying disagreement. And it was held
that such a disagreement could be deliberately created
for the purpose of creating an industrial dispute which
the Court could then arbitrate. Windeyer J. once
- "The dispute here is a "paper dispute". To permit
the creation of a malady so that a particular brand
of physic may be administered must still seem to some
people a strange way to cure the ills and ensure the
health of the body politic. But the expansive expositions
by this Court of the meaning and effect of par. (xxxv),
especially in the Burwood Cinema Case (1925)
35 C.L.R. 528 and in Amalgamated Engineering Union
v Metal Trades Employers' Association (1935) 53
C.L.R. 658 have brought a great part of the Australian
economy directly or indirectly within the reach of
Australian industrial law and of the jurisdiction of
the Commonwealth industrial tribunal."
- See Ex parte Professional Engineers' Association
(1959) 107 C.L.R. 208 at p. 268.
- (6) Thus the power was not merely a power to deal with
overt confrontations in fact extending beyond one State;
it extended to dealing with paper disputes as to conditions
of work, with the interstate element being provided
by having a multiplicity of parties. An intended function
of preventing and settling disputes became a function
of prescribing conditions of work. The fixing of a
"fair" wage for this dispute became an ongoing function
of fixing a basic wage for award after award, and finally
for awards generally.
- (7) Skilful use of the "ambit claim" and of the power
to "reopen" an award already made often enabled the
parties to keep a subsequent dispute within the jurisdiction
of the Court even though that subsequent dispute had
no real interstate element at all.
- (8) By 1947 the activities of the Court itself were
in fact confined to a few large matters (in particular
the "basic wage"), and all other disputes were handled
by Conciliation Commissioners (whose functions involved
arbitrating as well as conciliating): see the comments
of Mr. R.M. Eggleston Q.C. in his paper Industrial
Relations, in Essays on the Australian Constitution
(1st edn., 1952) at pp. 186-187.
- (9) The range of matters capable of giving rise to
an industrial dispute, and the range of things an award
might properly do, was steadily extended. In particular
the principle was adopted that an award could relate
to the conditions of employment of persons other than
the members of the union which had created the dispute.
The decision of the High Court in Metal Trades
Employers Associations v Amalgamated Engineering Union
(1935) 54 C.L.R. 387, Dixon J. dissenting, was based
on a principle which Dixon J. later described as follows:
- "The principle upon which the decision rests is that
the interest which an organization of employees possesses
in the establishment or maintenance of industrial conditions
for its members gives a foundation for an attempt on
its part to prevent employers employing anyone on less
favourable terms. As a result an industrial dispute
may be raised by it with employers employing none of
its members and an award may be made binding such employers
and regulating the terms and conditions upon which
they may employ unionists or non-unionists."
- See R. v The Commonwealth Court of Conciliation
and Arbitration; ex parte Kirsch (1938) 60 C.L.R.
507 at p. 537.
- (10) The concept of "industrial dispute", long read
down as if the relevant words were something like "disputes
in industry", was finally seen as applying to disputes
arising with respect to employment of all types, and
as including all "disputes between employees and employers
about the terms of employment and the conditions of
- See R. v Coldham; ex parte Australian Social
Welfar0e Union (1983) 153 C.L.R. 297 at p. 312.
- The result was the growth of the powers of the tribunal
under its various names, laying down conditions of
employment including those relating to hours and wages
and cost of living increases and such things for people
before or not before the tribunal, with a freedom which
a Commonwealth Treasurer or Parliament might well envy.
Further years confirmed Eggleston's summing-up of
- "But enough has been said to demonstrate that the
inter-pretation in the provision by the High Court
has enabled Commonwealth tribunals to extend their
influence to an extent which the framers of the Constitution
could hardly have contemplated. Eggleston op.
cit. at p. 208.
Perhaps I can intrude here that in private conversation
in the late 1950's Sir Owen Dixon made the comment
that it had been a fundamental mistake to attach the
name "Court" to the Commonwealth Court of Conciliation
and Arbitration, and the name "Judge" to the persons
constituting it. The principal function was essentially
different from that of a court. A court determines
what the parties' rights are. This tribunal lays down
what the parties' rights shall be, which is essentially
a legislative function, not a judicial one. No good
could come, he believed, from the people of Australia
being led to believe that what was done by this arbitral
tribunal was done by a court. The realisation of the
nature of the function led of course to the Boilermakers'
Case, and to the jurisdiction of the initial Court
being split between two new bodies the Commonwealth
Industrial Court (now replaced by the Federal Court)
and the Commonwealth Conciliation and Arbitration Commission
(now the Industrial Relations Commission). The Commission
has no "Judges", but appointments of its Presidential
Members are usually made from practising lawyers, and
once appointed they look like and have rights like
judges. If it be true that only a lawyer or quasi-lawyer
can properly fulfil the role of Presidential Members
of a body set up to determine what ought to be, not
what is, that itself may be a serious criticism of
C. Coalition Policy
The Coalition's Industrial Relations policy (I speak
from the document "Industrial Relations Policy 20 October
1992", which has different paragraph and page numbering
from that of the document dated 1990 referred to in
earlier commentaries) sets out to handle industrial
relations matters in this country in a very different
manner from that described earlier. In particular,
for present purposes:
- (1) Persons not in an "award area" can enter into whatever
employment relationships they wish, with or without
a contract in writing, and with no prescribed minimum
conditions: para. 2.9. I take an "award area" to include
an area covered by an award and an area for which an
award is sought.
- (It is curious that one has to get so far into the
Policy document to find this proposition. The early
part of the Policy centres on people who need to obtain
their freedom from the award system. Only at para.
2.9 does it deal with people who, like the Apostle
Paul and Mrs. Adamson's lioness Elsa, were born
- (2) Individuals or groups of employees within the award
area are to be free to enter into workplace agreements
with their employer.
- Alternatively they may:
- i) Remain for the being time under their award and
the total Commission system;
- ii) Remain for the time being under a certified agreement
under s. 115 of the Industrial Relations Act
- See Policy 1992 paras. 2.1-3, 2.6., 2.15.
- (3) To enter into a workplace agreement is to exercise
an option to leave the award system: paras. 2.2, 2.9.
The Commission will have no function in relation to
disputes arising in relationships other than those
for which the parties have accepted its jurisdiction:
para. 2.1. So the Commission will have no function
in relation to disputes under workplace agreements.
- (4) Workplace agreements can be entered into only between
an individual employer and one or more of his employees:
para. 2.7. A union or employer organisation cannot
be a party to a workplace agreement: ibid.
- (5) Workplace agreements must observe minimum rates
of pay and conditions of employment: paras. 2.4-5.
They must contain their own dispute-settling procedure:
- (6) Once entered into the workplace agreement will
be legally enforceable. This is assumed (as in para.
5.4, imposing a limit on the awarding of damages) rather
than stated. The assumption is justified. The workplace
agreement will constitute a contract, and will automatically
be enforceable at common law unless some statutory
- (7) The law will be amended to enable a date to be
proclaimed for the termination of every award on its
next anniversary, unless the parties to an award apply
jointly for its continuation in relation to particular
workplaces: para. 2.12.
- i) If they so apply, the award will continue to apply
in full force.
- ii) Where an award terminates under para. 2.12 and
no replacement workplace agreement has been entered
into, the employee will continue to enjoy the conditions
which applied under the terminated award: para. 2.13.
This will be achieved by legislation "to incorporate
those terms and conditions into the relationship" between
employer and employee: ibid. Changes in the
conditions will come by agreement: 2.13-14. The legislation
will provide a dispute settling procedure, for although
the employee is enjoying the conditions which applied
under the award, the award will in fact have terminated,
and disputes under it will not be within the jurisdiction
of the Commission: para. 2.14. In effect the parties
will inherit by legislation a contractual position.
D. The Constitutional Fears
As noted earlier, questions as to the constitutional
basis for the necessary legislation were raised, and
doubt expressed, in a paper read by Mr Greg Craven
to a conference of this Society in September 1991.1
There is also in limited circulation a research assignment
"The Constitutional Aspects of Deregulating the Labour
Market", prepared in 1991 by Mr D.G.C. Purvis. Its
Bibliography collects other literature on the matter.
Mr Craven's title, You Agree, I Agree, But Will
the High Court Agree ?, indicates one large part
of Mr Craven's concern, namely the High Court. Mr
Craven identified three principal grounds for concern:
- a. That the essentially Irish Catholic labour background
of several of the judges would lead them to see the
Coalition proposals as "outlandish, unusual, threatening,
and radical", with a cultural aversion to them arising
- b. That as regards "the scope of Commonwealth power"
the Court reached a "highwater mark" in 1982 (he meant
1983) in the Dams Case (in fact there was only
one dam, but no one likes to call it the Dam
Case) and is now in a trend of retreat from
that position, as shown by the Corporations Case.
(Formally, The Commonwealth v Tasmania (The
Tasmanian Dam Case) (1983) 158 C.L.R. 1, and New
South Wales v The Commonwealth (The Corporations
Case) (1990) 169 C.L.R. 482). It is said to be
"clear" that the Court "has lost some of its taste
for an ascendant Commonwealth".
- c. That decisions such as the Bank Nationalisation
Case (Bank of New South Wales v The Commonwealth
(1948) 76 C.L.R. 1) show that the High Court "is inclined
to look askance at radicalism" (which ironically comes
these days from the right), so that one must fear that
the Coalition legislation "will not find a naturally
sympathetic High Court".
The result of all this, it is said, is that one must
fear that the Court would be likely to treat as fatal
any constitutional doubts which might fairly be found
I return to such considerations in due course. Meanwhile
my task is to consider what the constitutional position
is under some of the various heads of power which have
been seen as relevant.
E. The Constitutional Basis for the Coalition Policy
- 1. Section 51 (xxxv):
The Arbitration Power
Mr Craven gives this power no detailed consideration,
on the basis that it is "rightly ... conceded that
it would not justify the enactment of industrial agreement
legislation". He says in particular:
- a. From its nature the provision looks to laws dealing
with aggregated industrial interests, whereas Coalition
policy is for the legislative individualisation of
- b. It would be hard to characterise a law with respect
to voluntary industrial agreements as a law with respect
to conciliation and arbitration.
- c. It would in very many cases be difficult to create
the element of interstateness.
From those considerations the con-clusion is drawn
that it will be necessary to look for the necessary
constitutional support in more esoteric places, as
in the corporations power and other powers not directly
related to the issue. I note that Mr Purvis likewise
finds "considerable obstacles" for the Coalition arising
from the wording of pl. (xxxv): p. 19.
This is the main area I wish to deal with tonight.
And I have to say that there seems to me significant
error in treating pl. (xxxv) as being anything like
as irrelevant as does Mr Craven. I accept readily
enough that pl. (xxxv) may not suffice to support the
whole policy. Probably no single provision of the
Constitution will do that. It may well be a matter
of depending on several sources of power. But once
one accepts that, the relevant question ceases to be,
Can I achieve the policy under this power ? It becomes
the more limited one, To what extent can this power
help me to achieve the policy ? And if one comes
at pl. (xxxv) with that humbler question, which Mr
Craven did not, I think the answer is in fact, Quite
Several matters need to be borne in mind:
- (1) A law which repeals a law which is within a head
of power, is itself within that head of power.2 A
law repealing the Industrial Relations Act entirely
would be valid, as a law with respect to conciliation
and arbitration, within pl. (xxxv).
- (2) There is no constitutional requirement that Parliament
shall exercise the power conferred by pl. (xxxv)---
or (in general at least) any other power---at
all, or to any particular extent. That is entirely
a matter for Parliament.
- (3) If Parliament does enact a law with respect to
conciliation and arbitration under pl. (xxxv), there
is no constitutional requirement:
- a. That the conciliating and arbitrating be by a
commission. (Parliament may enact that it is to be
done by Three Wise Men, or a panel from the committee
of the Housewives' Association, or the winner of the
- b. That the conciliating and arbitrating be by one
body. (Parliament might establish a different body
for each industry, or however else it chooses.)
- c. That the power to conciliate and arbitrate be
given to someone with respect to every dispute
which the Constitution would permit the Parliament
to vest in someone. (Indeed if Parliament established
a number of tribunals it would be forced to
lay down which of them had power to conciliate and
arbitrate which disputes.) It is for the Parliament
to say what power to conciliate and arbitrate in respect
of what disputes it chooses to confer on which body.
- (4) There is no constitutional principle that the jurisdiction
be given permanently. What Parliament has given, Parliament
can take away. (Though I will not add, Blessed be
the name of the Parliament.)
- (5) A law saying how long an award made under the system
the Act establishes shall remain in force seems to
me a law "with respect to" conciliation and arbitration,
and likewise a law imposing a time limit on awards
already in force.
- (6) It is too simplistic to describe the Coalition
Policy as being about "voluntary industrial agreements"
and then to say that laws about voluntary industrial
agreements are not laws about conciliation and arbitration.
That may all be true, but it misses the point. People
can---in this Society it ought not to be necessary
to stress the point---People can enter into voluntary
agreements without Parliament saying that they can,
and laws which are laws with respect to conciliation
and arbitration can be conditioned on the presence
or absence of a voluntary agreement.
For reasons (1) to (5) just given I would for myself
see little reason to doubt that the arbitration power
would support laws providing:
- a. That existing awards shall cease to apply to persons
who enter into a workplace agreement.
- b. That existing awards shall terminate on their next
anniversary, unless continuation is sought by the parties.
- c. That the Commission shall not have jurisdiction
as to disputes arising between parties who have entered
into a workplace agreement, or between such other persons
as Parliament prescribes.
- d. That the Commission shall not have jurisdiction
as to a dispute as to the conditions of employment
of persons employed under workplace agreements.
All that would not of course get all of the workplace
agreement side of things set up. But it would bring
about the untying of things under the existing system,
to accommodate such workplace agreement events as in
fact happened. And doing that would open the way to
much more: see point (6) above. Putting aside the
case of minors (which is in fact specially dealt with),
an employee (a person) does not need an Act of Parliament
to authorise him to enter into a workplace agreement
(contract) with his employer (another person). He
has that right under common law, as a free person.
All he needs is that no Act of Parliament (or award
thereunder) tells him that he can't. And a law cutting
back the Industrial Relations Act to ensure
that neither that Act nor an award thereunder says
any such thing is in my view a valid law, as a law
under pl. (xxxv).
The comment would of course be justified, that laws
such as these would merely remove obstructions to people
binding themselves to agreements, and would not empower
compulsion. Difficulties are then seen as regards
such things as requiring that workplace agreements
meet minimum conditions. If there is no power to make
laws with respect to workplace agreements, how does
Parliament ensure that workplace agreements meet minimum
No matter what your organisers have said, this is
not the occasion to pursue the detail of legislative
drafting. But I can say that I doubt if the problem
is beyond the wit of man. Many laws about one matter
affect conduct in other matters. Tax law offers many
examples. The right to a deduction or a reduced rate
of tax is frequently made conditional on arrangements
meeting certain conditions which the Commonwealth cannot
itself compel. No Commonwealth or other law says that
any owner of an item of property on the Register of
the National Estate must, or that he is authorized
to, give it to the National Trust; or that the National
Trust must, or is authorized to, agree to preserve
that item of property for the benefit of the public.
Section 78 (1)(aaa) of the Income Tax Assessment
Act merely says that if those events do happen
then the owner shall have a deduction of the value
of the item of property. Practical control over superannuation
has been assumed in much the same way. There are many
other examples. Now a formal workplace agreement can
only exist in an award area: cf. paras. 2.2 and 2.9
of the Policy. And only if a negotiated agreement
fits the definition of workplace agreement will entry
into it exclude the award. If the Act says that to
qualify as a "workplace agreement" the agreement in
fact negotiated must require payment of minimum rates
and contain a dispute settling procedure, I would have
thought that the problem of making such agreements
meet minimum conditions and contain a dispute settling
procedure would disappear. Why bother to sign an agreement
which doesn't achieve anything? And certainly the
employee will be protected, for if the agreement is
not a workplace agreement he will remain under the
I can see the possibility, if it were thought necessary,
of a system of registration of workplace agreements,
with only registered agreements having the effect of
excluding the operation of awards, and with registration
requiring compliance with the relevant conditions.
I do not mean that such devices are altogether easy,
or that they will solve all problems. But it does
seem to me that a very great deal of what is sought
can be achieved by skilful (not always present these
days) drafting well within the arbitration power.
I feel very much more bullish as to this power than
did Mr Craven.
2. Other Powers: General
I fear that what I have said as to calling pl. (xxxv)
itself in aid does not exempt me from dealing with
other possible sources of power, though I will do so
much more briefly than I might have done otherwise.
I make two preliminary comments.
- A. Mr Craven says:
- "Put simply, there is no fully satisfactory head of
power for the passage of such legislation."
Again I suggest the more humble question: To what extent
can this power help?
- B. The Industrial Relations Act has already
adopted drafting devices as long found in the Trade
Practices Act 1974, for attracting all practicable
heads of constitutional support: cf. s. 6 of that Act.
Section 127C of the Industrial Relations Act
as inserted by the Industrial Relations Act
1992, provides as follows:
- "127C. (1) Section 127A and 127B apply only as follows:
- (a) in relation to a contract to which a constitutional
corporation is a party;
- (b) in relation to a contract relating to the business
of a constitutional corporation;
- (c) in relation to a contract entered into by a constitutional
corporation for the purposes of the business of the
- (d) in relation to a contract relating to work in
trade or commerce to which paragraph 51 (i) of the
- (e) in relation to a contract so far as it affects
matters that take place in or are otherwise connected
with a Territory;
- (f) in relation to a contract to which the Commonwealth
or a Commonwealth authority is a party.
(2) In this section:
- "constitutional corporation" means a corporation
to which paragraph 51 (xx) of the Constitution applies;
- "contract" has the same meaning as in section 129A."
There will be nothing new in a similar device being
applied more widely.
3. Section 51 (xx):
The Corporations Power
The precise terms of the power are:
- "(xx) Foreign corporations, and trading or financial
corporations formed within the limits of the Commonwealth."
It has become clear through a series of cases that
the phrase "trading or financial corporations" has
a wide meaning: see e.g. R. v Federal Court of Australia;
ex p. W.A. National Football League (1979) 143
C.L.R. 190, State Superannuation Board v Trade Practices
Commission (1982) 150 C.L.R. 282, Actors and
Announcers Equity Association of Australia v Fontana
Films Pty. Ltd. (1982) 150 C.L.R. 169, Fencott
v Muller (1983) 152 C.L.R. 570, The Tasmanian
Dam Case (l983) 158 C.L.R.1. It will apply to
the vast majority of corporations, statutory or otherwise,
which employ people in Australia.
There has been discussion as to whether the power
is limited to enacting laws with respect to those activities
of trading corporations which make them such, namely
their trading activities; or whether the power extends
to all things to do with such corporations. The latter
view has prospered. The view is increasingly supported,
that the pro-vision will support any law directed
at trading corporations: see The Tasmanian Dam Case
(1983) 158 C.L.R. per Mason J. at pp. 148-153, per
Murphy J. at p. 179, per Brennan J. at p. 241, tending
that way as earlier in Fontana Films, and per
Deane J. at pp. 268-272. In his Southey Memorial Lecture,
The Constitution---Major Overhaul or Simple Tune-up
?, Dawson J. has accepted that the majority view now
is that pl. (xx) authorises laws with respect to anything
to do with a trading corporation (1984) 14 M.U.L.R.
353. The view has been summed up in the phrase that
any law in the form "No trading corporation shall"
or "Every trading corporation shall" is valid: see
per Mason J. at p. 149, quoting interestingly a passage
from the 1909 judgment of Griffith C.J. in Huddart,
Parker & Co. Pty. Ltd. v Moorehead (1909) 8
I doubt if that view will now be departed from. And
I observe that a judge who was subject to attitudes
of the kind Mr Craven notices would find himself in
something of a quandary on this point. Attitudes of
that kind lead one toward liking a wide corporations
power. A judge who gave the power a limited ambit
here would restrict what the power would justify in
areas the judge did like to see the Commonwealth control.
If the alternative view were in fact accepted, that
the law must relate in some way to the trading activities
of the trading corporation, the question would arise
whether a law governing the conditions of employment
of those employed by the trading corporation was sufficiently
related to the trading activities to be a law relating
to the trading corporation's trading activities. I
should have thought that it was. What Dawson J. (dissenting
from the majority) required in The Tasmanian Dam
Case, was that "the fact that the corporation
is a trading corporation should be significant in the
way in which the law relates to it": 158 C.L.R. at
p. 316. Trading corporations are the great employers
in this country, and the connection between the trading
and the employment seems direct and obvious. They
could not trade in any substantial sense without employing;
they employ so that they can trade. Mr Craven suggests
validity on the basis that the law is one for the protection
and enhancement of the companies' trading activities,
and alternatively that it is a law regulating activities
undertaken by the companies for the purpose of trade.
The second seems to me particularly true.
I should mention, to exclude it, the possibility of
arguing that Parliament could not use the corporations
power to support laws as to conditions of work, because
that would be inconsistent with the existence of a
particular conciliation and arbitration power in pl.
(xxxv). It is true that in certain cases the existence
of a limit in the expression of one power will lead
to another being cut down. Thus pl. (xiii) enables
the Parliament to make laws with respect to "Banking,
other than State banking ..." It is established that
the corporations power would not authorise a law with
respect to State banking, because the restriction in
pl. (xiii) is seen as being intended as a general restriction
on Commonwealth power, not merely as a restriction
on the banking power of pl. (xiii): see Bourke v
State Bank of New South Wales (1990) 170 C.L.R.
276. It seems to me impossible to get from pl. (xxxv)
any restriction limiting the making of laws with respect
to conditions of work under other heads of power, and
I note that the Commonwealth has long enacted such
laws, as e.g. with relation to its own employees, and
(under the trade and commerce power, pl. (i)) with
respect to stevedoring.
The principal weakness of course with reliance on
the corporations power is that its use says nothing
where the employer is not a financial or trading corporation.
But if I am right in thinking that a great deal of
what is sought can be achieved through the arbitration
power, very useful support could be gained from the
corporations power. In particular:
- A. Most of the large employers would be covered.
As I recall the figures, although very many people
in aggregate are employed by non-corporate employers,
large non-corporate employers are rare indeed.
- B. The home of awards is in government and large corporations.
Non-corporate employers and their employees want little
but to be left alone, and that is what the Policy seeks
to do for them. Corporate cover would enable the Parliament
to eliminate the interference otherwise flowing from
the award system.
4. Section 51 (i):
The Trade and Commerce Power
- This power gives the Common-wealth power to make
laws with respect to:
- "(i) Trade and commerce with other countries, and
among the States."
It is premature to call this a sleeping-giant of a
power, but it has long been noted that a very similarly
worded power in the Constitution of the United States
is a very active giant of a power: see generally the
remarks of Sir Owen Dixon in the Bank Nationalisation
Case (1948) 76 C.L.R.1 at pp. 380-383, to which
on appeal the Privy Council said it could add nothing:
(1949) 79 C.L.R. 497 at p. 633. It would not surprise
if this power were a growth stock over the next generation
Propositions already established are that:
- 1. The power extends to laws as to the employment of
persons actually engaged in trade and commerce with
foreign countries and among the States:
- Seamens' Union of Australia v Utah Development
Co. (1978) 144 C.L.R. 120.
- 2. The power extends to laws as to the employment of
persons directly connected with such trade and commerce,
as e.g. in stevedoring:
- Huddart Parker v The Commonwealth (1931) 44
- 3. The power extends to industrial relations matters
in relation to such persons:
- R. v Wright ex p. Waterside Workers' Federation
(1955) 93 C.L.R. 528.
- The power is called in aid for the extended operation
of the Trade Practices Act (see s. 6 (2)(a)(i)
and (ii) of that Act), and in s. 127C of the Industrial
Relations Act 1988 referred to earlier.
There seems to me the likelihood of a large supporting
power here. And again one notices that any judge predisposed
in favour of Common-wealth power is likely to be predisposed
in favour of a large trade and commerce power. His
quandary here would arise from the fact that the trade
and commerce power would, unusually, be being used
in support of legislation not leading to Commonwealth
control. But in restricting the power he would be
throwing a pretty big baby out with the bathwater.
- 5. Section 61: The Executive Power
- 6. The Nationhood Argument
Without going into detail, the observation seems sufficient
that if the Policy is calling these powers in aid,
it is in serious trouble.
7. Section 51 (xxix) The External Affairs Power
This power gives the Commonwealth power to make laws
with respect to:-"(xxix) External affairs."
The power became notorious in the Tasmanian Dam
Case, and has justly been seen as threatening the
entire balance of the Constitution. It is no doubt
for this reason that the Coalition Policy says that
to the extent that it is necessary "the Commonwealth's
full constitutional power, except the exter-nal
affairs power, will be used."
See the Executive Summary at p. v of the Policy document.
My only comment as to this, is to pose the question
as to how the Commonwealth, in enacting legislation,
abstains from relying on a particular power. It is
one thing to abstain from so drafting as to call a
power in aid, in the manner that s. 6 of the Trade
Practices Act and s. 127C of the Industrial
Relations Act do. But a constitutional power can
be relevant without being called in aid in that way.
If a challenge to the Act were mounted, the High Court
might well say that the issue was whether the Act was
valid, not whether it was valid because falling within
such powers as the Government of the day found politically
correct, and wished to rely on. Or is the Act itself,
as passed by Parliament, to take the surprising course
of saying that to the extent that a provision is valid
only because justified by the external affairs power,
Parliament's intention is that the provision shall
be invalid? I think the Coalition might have more
difficulty in not relying on the external affairs
power than it recognised when it put the entirely understandable
disclaimer into the Policy.
Generally then, and while seeing significant tasks
for drafting, I would not have thought that achievement
of the Policy was beyond the constitutional competence
of the Commonwealth. And I cannot but observe that
leaving people free to make their own agreements if
they wish ought not to be.
F. The High Court of Australia
The published title of tonight's paper suggests that
I will now say something about the High Court in the
particular context of industrial relations. In fact
I will speak rather more generally, and will confine
myself to a few separate though not disconnected observations.
I would say first, Always remember that the Judges
of the High Court are clever people. (In a less exposed
position I would be prepared to discuss the possibility
of exceptions to this statement, but it remains generally
Second, I doubt if it is wise to note that in 1983
the Commonwealth won the Tasmanian Dam Case,
and that in 1990 the Commonwealth lost the Corporations
Case, and on that basis to conclude that the High
Court "has lost some of its taste for an ascendant
Commonwealth". In the first place, I would not have
thought the two cases sufficiently similar to justify
the basic comparison. The Corporations Case
turned on the very particular wording of the corporations
power. I can find nothing in what was said there to
show how the Court would have approached a Tasmanian
Dam Case occurring in 1990. In the second place,
to draw a trend-line from two cases seven years apart
is to go beyond what the data will fairly justify.
The fact that it was 0 degrees celsius at 6 a.m. Monday
morning and 25 degrees celsius at 4 p.m. on Friday
afternoon simply does not justify drawing a straight
line from 0 to 25 as representing the trend of temperatures
over that period: and still less to see it as indicating
a likelihood for the future. For all you know it was
45 degrees celsius on Thursday afternoon, and the trend
on Friday was sharply downwards. The data is simply
insufficient. Similarly here.
Third, I doubt that it is correct historically to
say that the Court has shown itself "inclined to look
askance at radicalism". Was the Court looking askance
at radicalism when it found the Communist Party
Dissolution Act 1950 unconstitutional ? (Australian
Communist Party v The Commonwealth (1951) 83 C.L.R.
1.) Mr Craven's own example of the Bank Nationalisation
Case (Bank of New South Wales v The Commonwealth
(1948) 76 C.L.R. 1) is at best arguable. In 1948
the suggestion of adding the step of ownership to the
pervading government control of commercial activity
to which Australia had become accustomed during the
war was not as radical as latter day commentators might
think. At that time nationalisation was much the go.
Communist Russia looked impressive, and the Cold War
had not started. England had nationalised the railways,
coal, steel, health, and much more. In this country
the banks were shocked at how little public outcry
emerged in their support. So I doubt that nationalisation
was seen as so very radical a step. And in recent
decisions the High Court has shown itself the reverse
of anti-radical in its own thinking. Welcome Australian
Capital Television Pty. Ltd. v The Commonwealth (1992)
6 A.L.J.R. 695 or not (I do), welcome Mabo v The
Commonwealth (1992) 66 A.L.J.R. 408 or not (I
don't), you cannot deny the radical nature of the thought
processes involved in both cases. I think Mr Craven's
case on this issue fails.
Fourth---and further analysis is required of
various aspects of what is involved in this proposition---I do think that the Court is increasingly and
distinctly influenced by what it perceives as community
attitudes. I instance as a regrettable example the
Court's undignified backflip on s. 260 of the Income
Tax Assessment Act, following the political and
media and public outcry in relation to Harbour bottom
schemes in particular and tax avoidance generally.
To their discredit, Mr Fraser and Mr Howard (Mr Howard
who had done more than any other person to control
tax avoidance in proper ways) brought to a compliant
Parliament retrospective legislation which opened the
door for the cascade of retrospective legislation we
were always warned would follow the first breach in
the wall of principle. The High Court scampered to
do its part, and distorted retrospectively a body of
s. 260 doctrine which whether right or wrong (I think
right) was we all thought well-established: Federal
Commissioner of Taxation v Gulland (1985) 160 C.L.R.
55. As Deane J. said in dissenting, "When one comes
to apply the 'settled' construction of s. 260 to the
facts of the present case, the outcome is inevitable.":
160 C.L.R. at p. 97. The actual outcome imposed by
the majority was the opposite, and without overruling
anything. Indeed we really need not speculate as to
the basic proposition. The reasons which Brennan J.
gave in Mabo for rejecting the legal authorities
which represented the law he was thought to be applying,
were based on "The expectation of the international
community "and" the contemporary values of the Australian
people": 66 A.L.J.R. at p. 422.
Fifth, the position of a High Court judge, and the
facilities provided to make life safe and comfortable,
join with a number of other factors to limit the amount
of contact the Judge has with the general community.
High Court judges are not much found in the streets
or on trams or in taxis or hotel bars. In almost all
the social contact they do have, even among old friends,
there is a degree of restraint in what is said to them,
and in how it is said. One is rarely quite
relaxed. What they know of community attitudes tends
to be what they have read of them in the media, both
the daily papers and the intellectual periodicals:
and what they learn through the Associate.
Sixth, the usual practice for High Court Judges has
been to have as an Associate a young person on his
or increasingly her way into the profession. These
days they are clever, bright, recently through a very
good course at the University, brimming with confid-
dence, and ready to keep the Judge flooded with ideas,
suggestions, and references to current literature.
And increasingly---one believes---they can
be found writing draft judgments.
A practical conclusion can be drawn from all this.
In his General Theory, Maynard Keynes comments
that the world is ruled by ideas much more than by
the practical men who think they are in charge of events.
When one considers how ideas presented to and emanating
from this Society have led within a very few years
indeed to each of the two major parties claiming to
be better than the other at tearing down the columns
of the old Temple of Industrial Relations, one sees
his point. Those who have ideas as to desirable future
arrangements of Australian affairs, and who wish to
have their influence on future decisions of the High
Court, would do well to see that controversial matters
are argued out not just privately but publicly: and
argued well. What enters into the discourse of educated
discussion is likely to form part of the Australian
feelings which will increasingly play a part in forming
decisions of the Court. A good article in Quadrant
may in time have a greater effect on the course of
decision than the highly paid advocate in his wig and
a silken gown.
G. Sir Owen Dixon
At the risk of trespassing on your patience I would
like, without warrant, to say a little more. I would
like to speak to you of Sir Owen Dixon, a judge of
the High Court from 4 February 1929 to 17 April 1952,
and its Chief Justice from 18 April 1952 to 13 April
1964. I do so for several reasons. One is that this
year has seen the twentieth anniversary of his death,
on 7 July 1972. It is important to help keep alive
an awareness of one of Australia's greatest sons.
Another is that people like you often do know something
of him, and wish to and ought to know more. And another
is that a few days ago I came across a letter written
by him, courteous and quirky and entirely typical,
which brought back many memories of him.
There was in the Australian Law Journal two or three
months ago a note of the anniversary. The comment
was made, that at any rate in New South Wales, Dixon's
judgments are not cited very often. Mildly surprised,
I counted in that particular issue (admittedly not
a sufficiently large sample) the number of references
to judgments of all High Court judges there have ever
been, and of Dixon separately. For all High Court
judges, the total was 42. For Dixon, the total was
20. Fractionally under half of all the references
to judgments of judges of the High Court, were to judgments
of Dixon. This is being forgotten with a vengeance!
It probably is true, that Dixon's judgments are not
cited in that very considerable court the New South
Wales Court of Appeal, and indeed in New South Wales
generally, as much as one would expect. That has long
been true. Dixon has never been given quite the position
in New South Wales that he would have commanded had
he gone to Fort Street. When he is, that might be
a small and not altogether unimportant sign of a national
maturity. He belongs to the common-law world, and
that includes New South Wales.
I first saw Dixon in March 1948, when as a very new
law student I went down town from my University college
in Melbourne to look at the High Court hearing the
Bank Nationalisation Case. During a law course
at Melbourne his judgments inevitably played a prominent
part. As an articled clerk I was fortunate enough
to be sent to attend his swearing-in as Chief Justice,
on 21 April 1952. His appointment was honoured by
a cable from Justice Felix Frankfurter of the Supreme
Court of the United States, saying simply "Law is enhanced".
After my return from three years at Oxford I went
to the Bar at the end of 1956. From that time I was
fortunate enough to see Dixon regularly, both while
appearing before the court, and also socially, principally
in a club he much frequented for lunch.
We all knew of course that he was a great judge.
Just how his fame had spread had been brought home
to me right back in the 1950's, when my Oxford tutor
Dr J.H.C. Morris told me that Dixon was the greatest
judge in the English-speaking world. On Dixon's retirement
in 1964 the Prime Minister Sir Robert Menzies Q.C.
spoke of testimony to similar effect from two Lords
Chancellor of England and from Justice Frankfurter.
Menzies spoke truly when he said how proud we were
of Dixon, and how we felt "occasionally that some of
the glory rubs off on us". On Dixon's death in 1972
Barwick spoke of him as "the most outstanding lawyer
this country has produced". He added more, when he
spoke of his recognition in America and in England
as "the greatest judicial lawyer of his time in the
English-speaking world". Oxford had given him its
Doctorate of Civil Law, honoris causa; Harvard
its Doctorate of Laws, honoris causa; and Yale
its Howland Prize. For most judges, appointment to
the High Court brings lustre. In the case of Dixon,
said Barwick, "His lustre was shed upon this Court."
Indeed he had been much more than merely a great judge.
In 1940 he was appointed Chairman of the Central Wool
Committee, in charge of the implementation of the Wool
Agreement between Australia and England, the foundation
of the Australian wool industry for the whole of the
war. Between 1940 and 1942 his very great administrative
skills saw him made a member of the Australian Shipping
Control Board, the Marine War Risks Insurance Board,
the Commonwealth Marine Salvage Board, and the Allied
Consultative Shipping Council in Australia. From 1942
until 1944 he took leave from the High Court and became
the Australian Minister of State in Washington. In
1950 he was chosen by the United Nations Organization
to mediate in the dispute between India and Pakistan
over Kashmir. A solution to this problem finally eluded
him as it has all others, but to this day his memory
and the memory of his efforts in seeking a solution
remain one of fine honour in both those bitterly contending
That was the public, the great, the distinguished
Dixon. I wish to speak more personally.
There was of course the utter integrity. I appeared
in front of him on an application for security for
costs in relation to an unimportant piece of litigation
from Western Australia. Something to do, if I recall
it accurately, with a sheep shearer's marriage. The
sum involved was about £250 ($500). I thought what
a funny system it was, that devoted the talent of one
of the all-time judges to my little application. Rather
like employing Don Bradman to oil a bat for me to
bat with. Dixon did not think it at all inappropriate.
It was part of the job as judge. Every case, every
application of any kind that came before him got his
utter attention, got the benefit of the entire ability
which fortune had given him.
I remember next the courtesy, the happiness, at times
the sheer fun of a court run by Dixon. At the start
of proceedings the court itself would be silent for
a time, as Counsel for the appellant swung into his
opening. Somewhere into the opening, about ten minutes
usually, there would be a cough. "Mr Thomson, is the
issue really this, ..... ?" I remember saintly Louis
Voumard Q.C. turning to me on such an occasion, and
saying untypically "Jesus he's a master." Lou and
I had worked on the matter for days. Dixon had identified
and formulated the very difficult issue better, after
ten minutes. From then on he might interfere little.
He might interfere a lot. Not, however, interference
by way of arguing against Counsel (who is not
paid to admit to the court that his argument is wrong);
more like (especially if Counsel were young) an invitation
to look into the problem together with Dixon, noticing
weaknesses, noticing strengths, till both were satisfied
that all relevant aspects of the issue had been looked
at. That left Counsel free to stress his points as
he is paid to do, and would see him thanked
for his assistance. "Thank you Mr Green, that has
been most helpful." And left to Dixon and the court
the responsibility of decision, without the comfort
of Counsel having effectually been forced to surrender.
I am reminded in this regard of a question Dixon often
put to young lawyers, "Who is the most important person
in the court?" Various answers were of course given,
usually, You Sir. With that put to one side, other
possibilities were examined. The judge; the barrister;
the solicitor; the Appellant; the Respondent; on a
hot day the Court Crier, who could open the windows
to let in some air. Dixon had one steadfast and illuminating
answer: "The most important person in the court is
the litigant who is going to lose. One of these parties
who have brought this case to the court is going to
lose. That person must leave the court satisfied with
the system in which he has lost; satisfied that his
Counsel and his case had fair treatment and every chance.
With Dixon presiding he saw that happen in front of
his very eyes. Every possible point had been noticed
and considered. Counsel likewise left the Court satisfied.
Each point he had discerned had been looked at; indeed,
during argument he had somehow discerned one or two
points he hadn't noticed previously, and he had pointed
those out too. Win or lose---he didn't know which
yet---he had had a good day. Arguing to Dixon
wasn't all that hard, after all. Rather fun really.
Indeed he had argued rather better today than he usually
did. His tentative little joke had gone down well.
And Dixon had thanked him as if he meant it. Must
tell Peggy about that tonight. Hope I come here again
soon. Dixon's answer to his own question was a very
wise one, and not every judge has wit enough to heed
And even young Counsel really did learn to essay a
tentative joke in Dixon's court. Dixon had no need
to pursue his own dignity. It was simply there, undoubted
and unchallenged. Laughter was frequent, jokes were
welcome, and Dixon contributed his share. His laugh
was unique; not a giggle, not a cackle, but certainly
high pitched, and containing elements of both: "Heh-heh-heh".
When he contributed a joke or made some devastating
comment (as he often enough did) it would end in this
explosion of a laugh.
Laughter was welcome because the work of a judge was,
Dixon more than once remarked, hard and unrewarding.
The work had a single aim: to decide correctly according
to law; and in doing so to develop the law in the manner
of the common law. Nothing was allowed to interfere
with that. Counsel for a Government asked that a constitutional
case be decided by a certain date, for some reason
of convenience to the Government. Dixon was not going
to have his court put on a time table for this or any
other case, for this or any other Government. He heard
Counsel out silently, and without the usual courtesy
of looking to inquire what his brethren might think
of the application, said tersely: "It is more important
that this case be decided correctly, than that it be
decided soon. The court is adjourned." There was
abundant steel there on the rare occasion indeed that
it was needed.
Outside the Court he was regarded by almost all who
had contact with him as a person somewhat apart from
the rest of us. He was a person of such enormous distinction,
and had been for so long, had been a High Court judge
for so long, had left the Bar so young, so long ago,
that very few people indeed felt in any sense his equal.
Indeed one could not talk to him without sensing that
this was someone different to anyone one had ever met.
One or two very senior Supreme Court judges (Sir Charles
Lowe, Sir Charles Gavan Duffy) addressed him as Dixon.
So I suppose did Menzies. Probably the other High
Court judges did the same, ex officio as it
were. To the rest of humanity he was "Sir Owen".
In his late years perhaps Lady Dixon, Alice Brooksbank
whom he married in 1920, was the only person in the
world who called him "Owen".
That sounds forbidding. In fact he was the opposite.
In his retirement speech he said "I believe in young
everything." He certainly did when having lunch.
At one of his clubs there was what was called the Judges'
Table, and he knew that if he lunched at that Club
he was in danger of being made to lunch there. "I'm
paid to work with judges, not to lunch with them---heh---heh---heh."
A particular annoyance was the tendency of some of
the judges who lunched there to seek a very authoritative
kerbside view on whatever problem was currently troubling
them. One judge opened a conversation: "I had a point
arise in front of me this morning, Sir Owen, that would
interest you." Dixon looked at him sardonically and
said "I doubt it---heh---heh---heh." He resumed
his lunch in peace.
For such reasons he usually lunched elsewhere, amid
graziers and doctors and bankers and others of the
manifold members he knew there. And here he would
gather to himself the young, sitting spellbound while
the great man talked---with his habitual happy slander---of
events and people in Australia and overseas. One felt
that one was being given an insight into things that
otherwise one would never have known. And one was.
An encyclopaedia of inside information as to events
in Australia was lost when Dixon died.
Whether one had lunched with him or not, any barrister
having coffee after lunch was likely to find the Chief
Justice alongside him saying "Can I offer you a ride
back ?" If you accepted---you usually did---
he would pass on to chat to others, and you kept your
eye open and followed him out when he left a few minutes
later. "He had never learned to drive a car himself,
and in Melbourne and Sydney he was driven in a great
black Armstrong Siddeley, two of four such cars brought
out for the 1954 Royal Tour. The bureaucrats had suggested
that these two be the Prime Ministerial cars, and I
have a hazy recollection of being told that Menzies
did try one of them for a week or so before deciding
that he preferred the big Buick he had been driven
in for some years (in which he could sit comfortably
in his preferred front seat), and assigning the Armstrong
Siddeleys with loving malice to Dixon. Dixon never
much liked the grandeur of the big car, but it did
let him provide welcome hospitality. Conversation
and laughter continued until the car reached the Court.
There everyone got out. Even if it were raining,
the car was not sent on the further hundred yards or
so to Owen Dixon Chambers. The car was provided by
the Australian taxpayers to drive the Chief Justice
of Australia to the Court; not to let him give separate
rides to friends. Distance did not matter. There
was no such concept as that of reasonable honesty.
Integrity was an absolute.
In 1963 Dixon was admitted to the Order of Merit,
the Order of 24 persons admission to which flows from
the personal nomination of the Monarch.3 Like many
another I wrote to offer my congratulations. No doubt
I said something to the effect that not only I but
the whole of the Victorian Bar was very proud of him.
Punctually I received the letter I have here. In
listening to it please remember that at the time it
was founded, the Order of Merit was intended to have
an emphasis toward political and military distinction,
an emphasis which has changed over the years.
"My Dear Hulme,
I am compelled by a very slight injury to my hand to
answer you in type."
Note the assumption that apart from the injury he would
have written by hand. He would have too. To everyone
who had written. The injury prevented that. But I
was not to be concerned. The injury was "very slight".
"I am very grateful for your letter. Whatever views
you or the Bar generally or any section of the Bar
may have formed, the truth is that the O.M. was intended
for other attainments, and that you will see somewhere
or other if you read widely enough."
You will notice the traditional legal distinctions
being gently parodied in the first part of the second
sentence, and in the later part of that sentence the
assumption that my reading is likely to be sufficiently
wide for the kind of esoteric knowledge involved.
"I have read comments in The Times about every appointment
to the Order for some years. I do not remember seeing
With kindest regards,
Typical indeed. Who else would even be aware that
he had read comments in The Times about every
appointment for some years ? And quirky indeed. Could
a new recipient of one of the world's great awards
express more firmly his confident belief that he would
soon be reading in The Times comments on his own appointment,
and finding it likewise disapproved? And perhaps be
looking forward to doing so?
It is time to cease. I have trespassed on your hospitality,
but in a good cause. The law in Australia has not
had another such a man, before or since. In all fields
of endeavour Australia has had but few. We forget
such men at our peril.
- 1. Greg Craven You Agree, I Agree, But Will the
High Court Agree?, published in the booklet Labour
Market Reform, The Constitution and the Law, published
by The H R Nicholls Society in December 1991.
- 2. I can see at least one probable exception to this
proposition, namely an Act to repeal those provisions
of the Judiciary Act 1903 which operate to bring
into existence the High Court of Australia. Section
71 of the Constitution says that "The judicial power
of the Commonwealth shall be vested in a Federal Supreme
Court, to be called the High Court of Australia..."
There could be an argument that once Parliament has
exercised its legislative power to call that Court
into existence, s.71 requires the continuance of that
Court. And if you don't think that argument would
win, I do.
- 3. Seven Australians have been appointed to the Order
of Merit: Samuel Alexander, philosopher; Gilbert Murray,
classical scholar; Sir Macfarlane Burnet and Lord Florey,
medical scientists; Sir Owen Dixon, jurist; Sir Sidney
Nolan, painter; and Dame Joan Sutherland, opera singer.
Why HR Nicholls?