HIGH COURT OF AUSTRALIA
GLEESON CJ,
GAUDRON, McHUGH, GUMMOW, KIRBY, HAYNE AND CALLINAN JJMatter No A6/2000
RE PETER IVAN MACKS & ORS RESPONDENTS
EX PARTE ANTHONY JOHN SAINT APPLICANT
Matter No A9/2000
RE PETER IVAN MACKS & ORS RESPONDENTS
EX PARTE ANTHONY FRANCIS JOHNSON & ORS APPLICANTS
Re Macks; Ex parte Saint [2000] HCA 62
Re Macks; Ex parte Johnson
7 December 2000
A6/2000 and A9/2000ORDER
1. Order that time for the making of the applications for writs of certiorari be extended.
2. Order absolute in the first instance for a writ of certiorari to quash the order of Registrar Carey of 13 June 1995 in proceedings SG3057 of 1995 in the Federal Court of Australia, ordering the winding up in insolvency and the appointment of the first-named eighth respondent as liquidator in respect of one of the companies in the group of companies comprising the second-named eighth respondents.
3. Order absolute in the first instance for a writ of certiorari to quash the orders of Registrar Fisher of 20 June 1995, in proceedings SG3074, SG3075, SG3076, SG3077, SG3078 and SG3079 of 1995 in the Federal Court of Australia, ordering the winding up in insolvency and the appointment of the first-named eighth respondent as liquidator in respect of six of the companies in the group of companies comprising the second-named eighth respondents.
4. Order absolute in the first instance for a writ of certiorari to quash the orders of O'Loughlin J of 30 August 1995, von Doussa J of 19 December 1995, and Branson J of 21 December 1995 and 24 January 1996, in proceedings SG3080 of 1995 in the Federal Court of Australia, ordering the winding up in insolvency and the appointment of the first-named eighth respondent as liquidator in respect of 54 of the companies in the group of companies comprising the second-named eighth respondents, and declaring void pursuant to s 445G(2) of the Corporations Law any deed of company arrangement entered into by any of those companies.
5. Order absolute in the first instance for a writ of certiorari to quash the order of Registrar Carey of 15 August 1995, in proceedings SG3124 of 1995 in the Federal Court of Australia, ordering the winding up in insolvency and the appointment of the first-named eighth respondent as liquidator in respect of one of the companies in the group of companies comprising the second-named eighth respondents.
6. Order absolute in the first instance for a writ of certiorari to quash the order of Mansfield J of 8 December 1998 in proceedings SG3080 of 1995 in the Federal Court of Australia, ordering that the first-named eighth respondent, as liquidator of all 64 companies in the group of companies comprising the second-named eighth respondents, had power under the Corporations Law to enter into the funding arrangement with the Commonwealth Bank of Australia and GIO Insurance Ltd.
7. Liberty to apply on 21 days notice to a single Justice for the making of an order for a writ of certiorari to quash the order of O'Loughlin J of 31 July 1995 in proceedings SG3050 of 1995 in the Federal Court of Australia ordering the winding up in insolvency and the appointment of the first-named eighth respondent as liquidator in respect of one of the companies in the group of companies comprising the second-named eighth respondents.
8. Applications for writs of prohibition dismissed.
9. In Matter A6 of 2000, applicant to pay the costs of the first‑named eighth respondent and of the ninth respondent.
10. In Matter A9 of 2000, applicants to pay the costs of the first‑named eighth respondent and of the ninth respondent.
Representation:
Matter No A6/2000
No appearance for the first to seventh respondents
R J Whitington QC with M F Blue for the eighth respondents (instructed by Ward & Partners)
D M J Bennett QC, Solicitor-General of the Commonwealth with S J Maharaj and C J Horan for the ninth respondent (instructed by Australian Government Solicitor)
M L Abbott QC with K G Nicholson for the applicant (instructed by Piper Alderman)
Matter No A9/2000
No appearance for the first to seventh respondents
R J Whitington QC with M F Blue for the eighth respondents (instructed by Ward & Partners)
D M J Bennett QC, Solicitor-General of the Commonwealth with S J Maharaj and C J Horan for the ninth respondent (instructed by Australian Government Solicitor)
D F Jackson QC with H A L Abbott for the applicants (instructed by Bonnins)
Interveners in both matters:
D Graham QC, Solicitor-General for the State of Victoria with P M Tate intervening on behalf of the Attorney-General for the State of Victoria (instructed by Victorian Government Solicitor)
R J Meadows QC, Solicitor-General for the State of Western Australia with R M Mitchell intervening on behalf of the Attorney-General for the State of Western Australia (instructed by Crown Solicitor for Western Australia)
B M Selway QC, Solicitor-General for the State of South Australia with R F Gray intervening on behalf of the Attorney-General for the State of South Australia and the Attorney-General of the State of Queensland (instructed by Crown Solicitor for South Australia and Crown Solicitor for Queensland)
M G Sexton SC, Solicitor-General for the State of New South Wales with M J Leeming intervening on behalf of the Attorney-General for the State of New South Wales (instructed by Crown Solicitor for New South Wales)
J L B Allsop SC with K M Guilfoyle intervening on behalf of GIO Insurance Limited (instructed by Corrs Chambers Westgarth)
Notice: This copy of the Court's Reasons for Judgment is subject to formal revision prior to publication in the Commonwealth Law Reports.
CATCHWORDS
Re Macks; Ex parte Saint
Re Macks; Ex parte JohnsonCourts and judges – Federal courts – Jurisdiction – Orders made by Federal Court in exercise of jurisdiction conferred by cross-vesting legislation – Status of orders of Federal Court made without jurisdiction – Whether federal law can empower a federal court to make orders binding until set aside in proceedings in which that court had no jurisdiction.
Constitutional law – Inconsistency – State laws providing for rights and liabilities of persons affected by ineffective judgments of federal courts – Whether any inconsistency between State laws and Federal Court of Australia Act 1976 (Cth) and Judiciary Act 1903 (Cth) – Validity of State laws.
Constitutional law – Invalidity under Chapter III – State laws providing for rights and liabilities of persons affected by ineffective judgments of federal courts – Whether State laws confer jurisdiction upon a State court which is incompatible with Chapter III of the Constitution – Whether State laws repugnant to federal judicial power – Validity of State laws.
Constitutional writs – Applications out of time – Whether certiorari should issue to quash order of federal court made without jurisdiction.
Constitutional law – Interpretation – Substance and form – Significance of distinction – Application to elucidation of suggested inconsistency between federal and State laws and incompatibility of State laws with Chapter III of the Constitution.
Words and phrases – "ineffective judgment", "relevant order", "superior court of record".
Constitution, ss 51(xxxix), 71, 73, 75, 76, 77, 109.
Corporations (South Australia) Act 1990 (SA).
Corporations (Queensland) Act 1990 (Q).
Corporations Law, s 58AA.
Federal Courts (State Jurisdiction) Act 1999 (SA), ss 3, 4, 6, 7, 8, 9, 10, 11, 12, 14.
Federal Courts (State Jurisdiction) Act 1999 (Q), ss 3, 4, 6, 7, 8, 9, 10, 11, 12, 14.
Federal Court of Australia Act 1976 (Cth), ss 5(2), 24, 33.
Judiciary Act 1903 (Cth), ss 35, 39.
GLEESON CJ. Between 1987 and 1990, legislation was enacted by the Commonwealth, State and Territory legislatures to provide for cross-vesting of jurisdiction between federal, State and Territory courts. In 1987 the Advisory Committee on the Australian Judicial System, in its Report to the Constitutional Commission[1], expressed doubts as to the validity of the proposed legislation, and drafted a constitutional amendment to support it. In 1988, in its Final Report[2], the Constitutional Commission recommended that the Constitution be amended to permit cross-vesting. No such amendment was put to a referendum.
[1](1987), pars 3.113-3.115.
[2]Vol 1, pars 6.29-6.38.
In 1990, the States of South Australia and Queensland enacted Corporations Laws which, as part of a scheme of cross-vesting, contained provisions purporting to confer jurisdiction on the Federal Court of Australia. The conferral by a State of judicial power on a federal court was the step that had been regarded as of doubtful validity. The South Australian statute was the Corporations (South Australia) Act 1990 (SA) ("the South Australian Corporations Act"). The Queensland statute was the Corporations (Queensland) Act 1990 (Q) ("the Queensland Corporations Act").
There were legal challenges to the validity of the legislation[3]. Finally, on 17 June 1999, in Re Wakim; Ex parte McNally[4], this Court held the legislation to be invalid.
[3]BP Australia Ltd v Amann Aviation Pty Ltd (1996) 62 FCR 451; Gould v Brown (1998) 193 CLR 346.
[4](1999) 198 CLR 511.
In the meantime, the Federal Court, exercising jurisdiction purportedly conferred on it by State Acts, including the South Australian Corporations Act and the Queensland Corporations Act, had made orders under the Corporations Laws of the various States. Relevantly to the present proceedings, during 1995 and 1996 the Federal Court made orders that a number of companies in the Emanuel Group be wound up, and that Peter Ivan Macks be appointed liquidator. Some of those companies had been incorporated in South Australia, and some had been incorporated in Queensland. The orders were under the Corporations Law of South Australia and Queensland respectively. Further, in December 1998, the Federal Court made certain funding orders confirming arrangements made by Mr Macks to borrow money for the purpose of certain litigation in the Supreme Court of South Australia.
One feature of the scheme of legislation of which cross-vesting was a part, was that it contemplated that, although a company may be wound up by, for example, the Federal Court, orders varying the winding up order, or other orders in the winding up, might be made by, for example, the Supreme Court of South Australia[5].
[5]Corporations Law, s 58AA(1) and ss 473 and 480.
In action 409 of 1998, commenced in the Supreme Court of South Australia by the companies in the Emanuel Group and Mr Macks as liquidator, the plaintiffs sued a firm of lawyers, and an associated company, alleging, amongst other things, breach of fiduciary duty and negligence. A similar action (number 410 of 1998) was commenced, also in the Supreme Court of South Australia, by the same plaintiffs against another firm of lawyers. Those actions were, at the time of the decision in Re Wakim on 17 June 1999, and still are, pending.
Understandably, having regard to the history of doubt about the validity of aspects of cross-vesting, the State Parliaments moved promptly, after 17 June 1999, to enact remedial legislation. Each State passed an Act entitled the Federal Courts (State Jurisdiction) Act 1999 ("the State Jurisdiction Acts"). The validity of part of that remedial legislation was considered, and upheld by this Court, in Residual Assco Group Ltd v Spalvins[6].
[6](2000) 74 ALJR 1013; 172 ALR 366.
The scheme of the relevant provisions of the South Australian State Jurisdiction Act (which is not materially different from the Queensland State Jurisdiction Act) may be summarised as follows.
Section 3 defines the term "State matter" to include a matter in respect of which a relevant State Act purports or purported to confer jurisdiction on a federal court. The South Australian Corporations Act and the Queensland Corporations Act were such State Acts.
Section 4 defines the term "ineffective judgment" as a judgment of a federal court in a State matter given or recorded, before the commencement of s 4, in the purported exercise of jurisdiction purporting to have been conferred on the federal court by a relevant State Act. The winding up and funding orders the subject of the present case were ineffective judgments.
Sections 6 to 11 and 14 are as follows:
"6. The rights and liabilities of all persons are, by force of this Act, declared to be, and always to have been, the same as if –
(a) each ineffective judgment of –
(i)the Federal Court of Australia, otherwise than as a Full Court of the Federal Court of Australia; or
(ii)the General Division of the Family Court of Australia,
had been a valid judgment of the Supreme Court constituted of a single Judge; and
(b)each ineffective judgment of –
(i)a Full Court of the Federal Court of Australia; or
(ii)the Full Court of the Family Court of Australia,
had been a valid judgment of the Full Court of the Supreme Court.
7(1) A right or liability conferred, imposed or affected by
section 6 –
(a)is exercisable or enforceable; and
(b)is to be regarded as always having been exercisable or enforceable,
as if it were a right or liability conferred, imposed or affected by a judgment of the Supreme Court.
(2) Without limiting section 6 or subsection (1) of this section, the rights and liabilities conferred, imposed or affected by section 6 include the right of a person who was a party to the proceeding or purported proceeding in which the ineffective judgment was given or recorded to appeal against that judgment.
(3) For the purposes of subsection (2), each ineffective judgment of –
(a)the Federal Court of Australia, otherwise than as a Full Court of the Federal Court of Australia; or
(b)the Family Court of Australia, otherwise than as a Full Court of the Family Court of Australia,
is taken to be a judgment of the Supreme Court constituted of a single Judge.
8(1) Any act or thing done or omitted to be done before or after the commencement of this section under or in relation to a right or liability conferred, imposed or affected by section 6 –
(a)has the same effect, and gives rise to the same consequences, for the purposes of any written or other law; and
(b)is to be regarded as always having had the same effect, and given rise to the same consequences, for the purposes of any written or other law,
as if it were done, or omitted to be done, to give effect to, or under the authority of, or in reliance on, a judgment of the Supreme Court.
(2) For the purposes of an enforcement law, any act or thing done or omitted to be done before or after the commencement of this section gives rise to the same consequences, and is to be regarded as always having given rise to the same consequences, as if each ineffective judgment were a valid judgment of the Supreme Court given in or in relation to the proceeding in or in relation to which the ineffective judgment was given or recorded.
(3) In this section –
'enforcement law' means a provision of a law (other than a law relating to contempt of court) that sets out a consequence for a person if the person –
(a) contravenes; or
(b)acts in a specified way while there is in force,
a judgment, or a particular kind of judgment, given by a court.
9(1) If –
(a)before the commencement of this section, a court gave or recorded an ineffective judgment ('the new judgment') on the basis that an earlier ineffective judgment ('the earlier judgment') was or might be of no effect; and
(b)the new judgment replaced the earlier judgment,
section 6 has no effect in respect of the earlier judgment.
(2) For the purposes of subsection (1)(b), the new judgment replaced the earlier judgment if the new judgment –
(a)purportedly conferred or imposed rights or liabilities similar to or different from those purportedly conferred or imposed by the earlier judgment; or
(b)purportedly affected rights or liabilities in a way similar to or different from the way in which they were purportedly affected by the earlier judgment.
10(1) The Supreme Court may vary, revoke, set aside, revive or suspend a right or liability conferred, imposed or affected by section 6 as if it were a right or liability conferred, imposed or affected by the Supreme Court in or in relation to proceedings of the kind in or in relation to which the ineffective judgment was given or recorded.
(2) In addition to its powers under subsection (1), the Supreme Court also has power to give a judgment achieving any other result that could have been achieved if –
(a)the ineffective judgment had been a valid judgment of the Supreme Court given in or in relation to proceedings of the kind in or in relation to which the ineffective judgment was given or recorded; and
(b)the Supreme Court had been considering whether –
(i)to vary, revoke, set aside, revive or suspend that judgment; or
(ii)to extend the time for the doing of any thing; or
(iii)to grant a stay of proceedings.
11(1)In this section –
'limitation law' means –
(a)the Limitation of Actions Act 1936;
(b)any other law that provides for the limitation of liability or the barring of a right of action in respect of a claim by reference to the time when a proceeding on, or the arbitration of, the claim is commenced;
'relevant order' means –
(a)an order of a federal court, whether made before or after the commencement of this section, dismissing, striking out or staying a proceeding relating to a State matter for want of jurisdiction; or
(b)a declaration by a federal court, whether made before or after the commencement of this section, that it has no jurisdiction to hear and determine a proceeding relating to a State matter; or
(c)any other decision or determination by a federal court, whether made before or after the commencement of this section, that it has no jurisdiction to hear and determine a proceeding relating to a State matter.
(2) A person who was a party to a proceeding in which a relevant order is made may apply to the Supreme Court for an order that the proceeding be treated as a proceeding in the Supreme Court and the Supreme Court may make such an order.
(3) If the Supreme Court makes an order under subsection (2), the proceeding, despite the relevant order –
(a)becomes, and must be recorded by the Supreme Court as, a proceeding in the Supreme Court; and
(b)for the purposes of any limitation law and for all other purposes, is taken to have been brought in the Supreme Court on the day on which the proceeding was first recorded as a proceeding in the federal court.
(4) The Supreme Court may make such ancillary orders in relation to an order under subsection (2) as it considers necessary for the purposes of the proceeding being treated as, becoming and being recorded as, a proceeding in the Supreme Court.
…
14.Nothing in this Act applies to –
(a)a judgment given or recorded by the Federal Court of Australia that has been declared to be invalid, or has been quashed or overruled, by a Full Court of the Federal Court of Australia before the commencement of this section (otherwise than on the ground that the Court had no jurisdiction); or
(b)a judgment given or recorded by the Family Court of Australia that has been declared to be invalid, or has been quashed or overruled, by the Full Court of the Family Court of Australia before the commencement of this section (otherwise than on the ground that the Court had no jurisdiction)."
The validity of s 11 was established in Residual Assco.
An accurate identification of the legal operation of s 6 is essential to a resolution of the issue which is now raised as to its validity. The legal effect of the section is expressed in a phrase which is used repeatedly in the succeeding sections when they refer back to s 6. It is to confer, impose, and affect rights and liabilities of persons.
The scheme of the remedial legislation was evidently modelled on legislation, which arose out of a similar form of necessity, held to be valid by this Court in R v Humby; Ex parte Rooney[7]. That case concerned legislation made necessary by the decisions in Kotsis v Kotsis[8] and Knight v Knight[9], which held that orders in matrimonial causes purportedly made by certain officers of State Supreme Courts were made without jurisdiction, because the jurisdiction which they purported to exercise could not lawfully be exercised by them. Following those decisions, it became necessary to deal with the rights, liabilities, obligations and status of persons affected by such orders. The Matrimonial Causes Act 1971 (Cth) was enacted. It applied in any case in which an officer of a State Supreme Court had made a purported decree, judgment or order. Section 5(3) provided that "[t]he rights, liabilities, obligations and status of all persons are … declared to be, and always to have been, the same as if … the purported decree had been made by the Supreme Court of that State constituted by a [judge]". This Court rejected an argument that such a provision was an interference with judicial power and infringed Ch III of the Constitution.
[7](1973) 129 CLR 231.
[8](1970) 122 CLR 69.
[9](1971) 122 CLR 114.
Central to the reasoning of the Court was the conclusion that the legislation did not purport to validate the invalid decrees but, rather, established, as was within legislative competence, rights, liabilities, obligations and status of persons. Historically, divorce was commonly effected by private Act of Parliament. The Parliament's power to make laws with respect to divorce extends to power to dissolve a particular marriage. It has power to declare that the rights and liabilities and status of persons whose marriages were purportedly but ineffectively dissolved by a person acting without jurisdiction are to be as if the dissolution had been by a person with jurisdiction. Similarly, it may be observed, the Parliaments of South Australia and Queensland have power, by legislative enactment, to wind up particular companies, or to declare that the rights and liabilities of persons in respect of an ineffective winding up order will be the same as if a winding up order had been made by a person with jurisdiction to do so.
In R v Humby, Mason J said[10]:
"It is plain enough that the circumstance that a statute affects rights in issue in pending litigation has not been thought to involve any invasion of the judicial power. ...
Here by legislative action the rights of parties in issue in proceedings which resulted in invalid determinations were declared. The rights so declared in form and in substance were the same as those declared by the invalid determinations. But the legislation does not involve an interference with the judicial process of the kind which took place in Liyanage v The Queen[11]".
[10](1973) 129 CLR 231 at 250.
[11][1967] 1 AC 259.
The present proceedings before this Court are brought by the defendants in the two actions that have been brought in the Supreme Court of South Australia. The objective is to prevent those actions from going ahead. To that end, the applicants challenge the standing of Mr Macks who, as liquidator, caused the actions to be commenced. The issues which arise may be summarised as follows. As a first step, the applicants contend that, since the winding up and funding orders were made by the Federal Court without jurisdiction, this Court, in the exercise of its jurisdiction under s 75(v) of the Constitution, should grant certiorari to quash those orders and prohibit the members of the Federal Court from taking further steps in the winding up of the companies. In one respect, that claim is not contentious. If the State Jurisdiction Acts are valid, then orders of the kind just mentioned would not adversely affect the liquidator, or prevent the continuance of the proceedings in the Supreme Court of South Australia. They might even serve a purpose which assists the liquidator. Thus, the liquidator's response to the first part of the applicants' claim is that it is agreed that the winding up and funding orders are ineffective judgments. The major area of dispute concerns the next step in the applicants' claim. They seek an order prohibiting the liquidator from taking further steps in the winding up of the companies or in the prosecution of the actions in the Supreme Court of South Australia. That involves a contention that the State Jurisdiction Acts, and, in particular, ss 6, 7 and 8 of those Acts, are invalid. That is where the substantial area of dispute in the matter lies. The making of orders of certiorari quashing the Federal Court orders gets the applicants nowhere. It is the order of prohibition directed to the liquidator that they need in order to achieve their objective in the present proceedings.
One ground upon which the argument of invalidity is based is that the State Jurisdiction Acts are inconsistent with the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act"). Thus, it is said, s 109 of the Constitution applies. This contention has given rise to another subsidiary question as to which, once again, the liquidator is content to accept the premise relied upon by the applicants, although some of the interveners are not. As a step in their inconsistency argument, the applicants submit that the orders of the Federal Court made without jurisdiction are not nullities, and remain binding until set aside, for example, by an order of an appellate court, or by an order of certiorari made by this Court. The liquidator agrees and, indeed, acknowledges that for that reason there may be utility in making the orders of certiorari sought.
It is convenient to deal immediately with this subsidiary question. The Federal Court was created in the exercise of the power given to the Parliament by s 71 of the Constitution. Sections 77 and 51(xxxix) are also relevant. The Federal Court Act, in s 5(2), provides that the Federal Court is a superior court of record.
In Cameron v Cole[12] Rich J, with whom Latham CJ agreed, said:
"It is settled by the highest authority that the decision of a superior court, even if in excess of jurisdiction, is at the worst voidable, and is valid unless and until it is set aside".
[12](1944) 68 CLR 571 at 590. See also at 598-599 per McTiernan J, 607 per Williams J.
The decision of this Court in DMW v CGW[13] provides an example of the operation of that principle in relation to the Family Court of Australia.
[13](1982) 151 CLR 491.
Recently, in Residual Assco[14], it was held that the Federal Court has the authority to decide its jurisdiction, and that Parliament had the legislative power to confer such authority upon it. The powers given to the Parliament and, in particular, the power given by s 77 to define the jurisdiction of any federal court other than the High Court, extend to a power to confer the authority implicit in the legislative characterisation of the Federal Court as a superior court of record.
[14](2000) 74 ALJR 1013; 172 ALR 366.
It may be accepted, therefore, in approaching the inconsistency argument, that the orders made by the Federal Court were not nullities, and that s 5(2) of the Federal Court Act meant that they were binding until set aside.
For the purposes of the present case, the question that must be decided is whether, having regard to the proposition just accepted, ss 6, 7 and 8 of the State Jurisdiction Acts are inconsistent with the Federal Court Act and, in particular, with s 5(2) of that Act.
It is at this point that the identification of the legal effect of those provisions, referred to earlier, becomes critical. The State Jurisdiction Acts operate to confer, impose and affect rights and liabilities of persons. They do that by reference to ineffective judgments of the Federal Court, as defined. They do not purport to affect those judgments. They do not purport to validate ineffective judgments of the Federal Court, or to deem such judgments to be judgments of the relevant State Supreme Court. The hypothesis upon which the judgments are defined as ineffective is that they were made without jurisdiction because the State Act purporting to confer jurisdiction was invalid (s 4). The rights and liabilities declared by s 6 are the same as if an ineffective judgment had been a valid judgment of a State court. They are rights and liabilities of a kind which State Parliaments have legislative power to impose.
There is no direct inconsistency involved in a State law declaring the existence of a right or liability which is the same as that arising, directly or indirectly, under a Commonwealth law[15]. The question is whether the Commonwealth law evinces an intention "to express by its enactment, completely, exhaustively, or exclusively, what shall be the law governing the particular conduct or matter to which its attention is directed."[16]
[15]McWaters v Day (1989) 168 CLR 289.
[16]Ex parte McLean (1930) 43 CLR 472 at 483 per Dixon J.
Reference was earlier made to a feature of the cooperative legislative scheme relating to corporations: a winding up order made, for example, by the Federal Court, may be varied by order of a Supreme Court; or a Supreme Court may make orders in a winding up following from an order of the Federal Court. That scheme was not inconsistent with the Federal Court Act.
The Federal Court Act does not evince an intention to cover a field which includes the rights and liabilities of persons affected by orders, valid or infirm, of the Federal Court. In so far as s 5(2) of the Federal Court Act, in the respects considered above, carries certain consequences in the case of an infirm order, the Act does not deny the possibility of a State legislature also dealing with the rights and liabilities of the parties, especially where the infirmity resulted from an invalid attempt by the State to confer jurisdiction on the Federal Court.
It is unnecessary to decide whether there is inconsistency between the appeal rights purportedly given by the State Jurisdiction Acts and the Federal Court Act. If there were such inconsistency the State Acts could, and should, be read down[17].
[17]cf Acts Interpretation Act 1915 (SA), s 13; Acts Interpretation Act 1954 (Q), s 9.
In addition to the argument based on inconsistency, it was submitted for the applicants that the State Jurisdiction Acts represent an attempted interference with the jurisdiction of this Court, or the Federal Court, or an attempt to confer jurisdiction upon the State Supreme Courts, which is repugnant to Ch III of the Constitution. In relation to the last part of that submission, reliance was placed upon Kable v Director of Public Prosecutions(NSW)[18].
[18](1996) 189 CLR 51.
Reference has earlier been made to the decision of this Court in R v Humby[19]. The reason there given for rejecting a similar submission applies here. Once again, it is to be found in the legal operation of the impugned legislation. It does not purport to validate ineffective judgments. It creates rights and liabilities of persons. It does so by reference to such judgments; but it does not affect the judgments.
[19]R v Humby; Ex parte Rooney (1973) 129 CLR 231.
The case for the applicants substantially fails.
There is utility in making orders of certiorari quashing the orders of the Federal Court. I would extend time to allow that to be done, and make such orders. Apart from that, however, the orders sought by the applicants should be refused, and the applicants should pay the costs of the liquidator and of the ninth respondent.
GAUDRON J. Peter Ivan Macks, the first-named eighth respondent in each of these matters ("the Liquidator"), is the liquidator of companies in the Emanuel Group of Companies ("the companies"). He was appointed liquidator pursuant to winding up orders of the Federal Court of Australia ("the winding up orders"). The orders were made in the exercise of jurisdiction purportedly conferred by the Corporations(South Australia) Act 1990 (SA) ("the SA Corporations Act") and, in some cases, the Corporations (Queensland) Act 1990 (Q) ("the Qld Corporations Act").
Further orders were subsequently made by the Federal Court with respect to arrangements made by the Liquidator to fund two actions commenced in the Supreme Court of South Australia in the name of the companies and, also, in the name of the Liquidator ("the funding orders"). The funding orders were also made in the exercise of jurisdiction purportedly conferred by the SA Corporations Act and the Qld Corporations Act.
In Re Brown; Ex parte Amann[20] (reported sub nom Re Wakim; Ex parte McNally and hereafter referred to as "Re Wakim"), this Court held that jurisdiction was not validly conferred on the Federal Court or the Family Court of Australia with respect to matters arising under a State Corporations Act. Accordingly, as the parties accept, the Federal Court had no jurisdiction to make the winding up orders and the funding orders earlier referred to.
[20](1999) 198 CLR 511.
Since the decision in Re Wakim, each State has enacted legislation, the short title of which is the Federal Courts (State Jurisdiction) Act 1999 ("the State Jurisdiction Acts"). The State Jurisdiction Acts are, in substance, identical. In general terms, the Acts are designed to ensure that, where certain orders have been made by a federal court in purported exercise of jurisdiction conferred by a State law, including orders under a State Corporations Act, the rights and obligations of the parties are the same as those specified in those orders. It is that legislation which is in issue in these proceedings.
The applicants in each of these matters are, for practical purposes, the defendants in each of the actions commenced by the Liquidator in the Supreme Court of South Australia. They seek to prevent the further prosecution of those actions by obtaining relief from this Court pursuant to s 75(v) of the Constitution. In each case, they seek certiorari to quash the winding up orders and the funding orders and prohibition directed to members of the Federal Court preventing them from taking any further steps in relation to the winding up of the companies. Additionally, they seek prohibition directed to the Liquidator "prohibiting him from taking any further steps in the winding up of [the companies] and from taking any further steps pursuant to the [winding up orders and the funding] orders or, in the alternative, from taking any further steps in the prosecution of [the actions in the] Supreme Court of South Australia".
The issues
So far as concerns their applications for certiorari to quash the winding up orders and the funding orders and for prohibition directed to members of the Federal Court, the applicants rely on the decision in Re Wakim. So far as concerns their applications for prohibition directed to the Liquidator, they contend that, save for s 11, the validity of which was upheld in Residual Assco Group Ltd v Spalvins[21], the State Jurisdiction Acts are inconsistent with the Federal Court of Australia Act 1976 (Cth) ("the Federal Court Act") and, thus, pursuant to s 109 of the Constitution, are invalid in their application to the Liquidator and the companies the subject of the winding up orders.
[21](2000) 74 ALJR 1013; 172 ALR 366.
In addition to the argument based on s 109 of the Constitution, the applicants contend that the State Jurisdiction Acts constitute "an unlawful interference with the roles, responsibilities and standing of each of the State Supreme, Federal and High Courts in a manner repugnant to Ch III of the Constitution".
In the alternative to the constitutional arguments outlined above, it was argued for the applicants that, even if the State Jurisdiction Acts are valid, the winding up orders and the funding orders should be set aside and that, in that event, there will be nothing upon or by reference to which the State Jurisdiction Acts can operate.
The Liquidator, the Deputy Commissioner of Taxation and the Attorneys-General of the States, who intervened in these proceedings, contend that the State Jurisdiction Acts are not invalid, whether by reason of inconsistency with the Federal Court Act or repugnancy to Ch III of the Constitution. And on that basis, the Liquidator argues that the applicants are not entitled to prohibition against him and that, as a matter of discretion, relief should not issue by way of certiorari or prohibition directed to members of the Federal Court.
Relevant provisions of the State Jurisdiction Acts
Each State Jurisdiction Act[22] relevantly provides, in s 6:
[22]There are minor differences between the various State Jurisdiction Acts. References will be to the South Australian legislation.
" The rights and liabilities of all persons are, by force of this Act, declared to be, and always to have been, the same as if–
(a) each ineffective judgment of–
(i)the Federal Court of Australia, otherwise than as a Full Court of the Federal Court of Australia;
...
had been a valid judgment of the Supreme Court [of the relevant State] constituted of [sic] a single Judge; and
(b) each ineffective judgment of–
(i)a Full Court of the Federal Court of Australia;
...
had been a valid judgment of the Full Court of the Supreme Court."
"Ineffective judgment" is defined in s 4(1) of the State Jurisdiction Acts as:
"... a judgment of a federal court in a State matter given or recorded, before the commencement of this section, in the purported exercise of jurisdiction purporting to have been conferred on the federal court by a relevant State Act."
And "federal court", "judgment", "relevant State Act" and "State matter" are defined in s 3 so as to include orders made by the Federal Court in purported exercise of jurisdiction conferred by a State Corporations Act[23].
[23]Relevantly, the State Jurisdiction Acts provide the following definitions:
"'federal court' means the Federal Court of Australia or the Family Court of Australia";
"'judgment' means a judgment, decree or order, whether final or interlocutory, or a sentence";
"'relevant State Act' means any of the following Acts:
...
(d) Corporations (South Australia) Act 1990".
"'State matter' means a matter–
(a)in which the Supreme Court has jurisdiction otherwise than by reason of a law of the Commonwealth or of another State or a Territory; or
...
(c)in respect of which a relevant State Act purports or purported to confer jurisdiction on a federal court".
The rights and liabilities to which s 6 of the State Jurisdiction Acts refers are elaborated in ss 7(1) and (2) as follows:
"(1) A right or liability conferred, imposed or affected by section 6–
(a)is exercisable or enforceable; and
(b)is to be regarded as always having been exercisable or enforceable,
as if it were a right or liability conferred, imposed or affected by a judgment of the Supreme Court.
(2) Without limiting section 6 or subsection (1) of this section, the rights and liabilities conferred, imposed or affected by section 6 include the right of a person who was a party to the proceeding or purported proceeding in which the ineffective judgment was given or recorded to appeal against that judgment."[24]
[24]Section 7(3) provides as to the basis upon which an appeal lies as follows:
" For the purposes of subsection (2), each ineffective judgment of–
(a)the Federal Court of Australia, otherwise than as a Full Court of the Federal Court of Australia; or
(b)the Family Court of Australia, otherwise than as a Full Court of the Family Court of Australia,
is taken to be a judgment of the Supreme Court constituted of [sic] a single Judge."
One other provision of the State Jurisdiction Acts should be mentioned. Section 10 provides:
"(1) The Supreme Court may vary, revoke, set aside, revive or suspend a right or liability conferred, imposed or affected by section 6 as if it were a right or liability conferred, imposed or affected by the Supreme Court in or in relation to proceedings of the kind in or in relation to which the ineffective judgment was given or recorded.
(2) In addition to its powers under subsection (1), the Supreme Court also has power to give a judgment achieving any other result that could have been achieved if–
(a)the ineffective judgment had been a valid judgment of the Supreme Court given in or in relation to proceedings of the kind in or in relation to which the ineffective judgment was given or recorded; and
(b)the Supreme Court had been considering whether–
(i)to vary, revoke, set aside, revive or suspend that judgment; or
(ii)to extend the time for the doing of any thing; or
(iii)to grant a stay of proceedings."
Inconsistency: the binding effect of Federal Court orders
It should be noted at the outset that, leaving aside the "right of appeal" elaborated in s 7(2) of the State Jurisdiction Acts, s 6 does not involve any direct inconsistency or any possibility of direct inconsistency with orders made by the Federal Court pursuant to a State Corporations Act. Rather, and again leaving aside the "right of appeal", s 6 reinforces those orders by declaring the rights and liabilities to be the same as if the orders had been made by State Supreme Courts, which Courts undoubtedly had and continue to have jurisdiction to make orders under the State Corporations Acts. The consequence of that is that the statutory rights and liabilities created by s 6 are precisely the same as those embodied in the relevant orders of the Federal Court. However, that does not bear upon the applicants' main argument with respect to inconsistency. That argument was made by reference to s 5(2) of the Federal Court Act.
Section 5(2) of the Federal Court Act provides that the Federal Court "is a superior court of record". The applicants contend that, on that account, orders of the Federal Court, whether or not made within jurisdiction, are final and binding unless and until set aside on appeal or pursuant to s 75(v) of the Constitution. Further, they contend that, by declaring the Federal Court to be a superior court of record, s 5(2) of the Federal Court Act evinces an intention on the part of the Parliament to legislate exclusively and exhaustively as to the effect of Federal Court orders – to "cover the field"[25], as it is sometimes said. Thus, according to the argument, a State law which purports to legislate on that subject is invalid pursuant to s 109 of the Constitution. Only if this argument fails is it necessary to consider the applicants' alternative argument that there is direct inconsistency between various provisions of the State Jurisdiction Acts and the Federal Court Act and that that inconsistency results in the total invalidity of the State Jurisdiction Acts.
[25]See Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466; Ex parte McLean (1930) 43 CLR 472; O'Sullivan v Noarlunga Meat Ltd (1954) 92 CLR 565; Airlines of NSW Pty Ltd v New South Wales [No 2] (1965) 113 CLR 54; Australian Broadcasting Commission v Industrial Court (SA) (1977) 138 CLR 399; Ansett Transport Industries (Operations) Pty Ltd v Wardley (1980) 142 CLR 237; Viskauskas v Niland (1983) 153 CLR 280; Commercial Radio Coffs Harbour v Fuller (1986) 161 CLR 47; Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373; Re Residential Tenancies Tribunal (NSW); Ex parte Defence Housing Authority (1997) 190 CLR 410.
On behalf of the Attorneys-General for Victoria, South Australia and Western Australia it was contended that, if made without jurisdiction, an order of a federal court is a nullity and the Parliament has no power to legislate to the contrary. Thus, according to the argument, s 5(2) of the Federal Court Act is invalid to the extent that it purports to give binding effect to orders made without jurisdiction and, in consequence, there is no inconsistency between that Act and the State Jurisdiction Acts.
The argument that orders of a federal court made without jurisdiction are nullities finds some support in general legal theory and, also, in a statement by Dawson J in R v Gray; Ex parte Marsh[26]. Traditionally, a superior court is a court of general jurisdiction and its orders are binding until set aside on appeal because it is presumed to have acted within jurisdiction[27]. However, a federal court is not a court of general jurisdiction: its jurisdiction is confined to the matters referred to in ss 75 and 76 of the Constitution[28].
[26](1985) 157 CLR 351 at 392-393.
[27]See Peacock v Bell and Kendal (1667) 1 Wms Saund 73 at 74 [85 ER 84 at 87-88]; Mayor, Etc, of London v Cox (1867) LR 2 HL 239 at 259 per Willes J; Revell v Blake (1873) LR 8 CP 533 at 544-545 per Blackburn J; Cameron v Cole (1944) 68 CLR 571 at 590-591 per Rich J; R v Metal Trades Employers' Association; Ex parte Amalgamated Engineering Union, Australian Section (1951) 82 CLR 208 at 240-241 per Latham CJ; DMW v CGW (1982) 151 CLR 491 at 504-505 per Gibbs CJ, 509 per Dawson J; R v Gray; Ex parte Marsh (1985) 157 CLR 351 at 393 per Dawson J; Jackson v Sterling Industries Ltd (1987) 162 CLR 612 at 618 per Wilson and Dawson JJ; Ousley v The Queen (1997) 192 CLR 69 at 107 per McHugh J.
[28]Section 75 of the Constitution provides:
"In all matters:
(i) arising under any treaty;
(ii) affecting consuls or other representatives of other countries;
(iii)in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party;
(iv)between States, or between residents of different States, or between a State and a resident of another State;
(v)in which a writ of Mandamus or prohibition or an injunction is sought against an officer of the Commonwealth;
the High Court shall have original jurisdiction."
Section 76 of the Constitution provides:
" The Parliament may make laws conferring original jurisdiction on the High Court in any matter:
(i) arising under this Constitution, or involving its interpretation;
(ii) arising under any laws made by the Parliament;
(iii) of Admiralty and maritime jurisdiction;
(iv)relating to the same subject-matter claimed under the laws of different States."
In R v Gray; Ex parte Marsh, Dawson J explained the position with respect to a federal court as follows:
" Section 5(2) of the [Federal Court Act] makes the Federal Court a superior court of record but ... such a legislative assertion cannot be taken at face value when it is made in relation to a federal court created pursuant to the powers vested in the Federal Parliament by Ch III of the Constitution: DMW v CGW[29]. A federal court is necessarily a court of limited jurisdiction. Its powers can be no wider than is permitted by ss 75 and 76 of the Constitution and when jurisdiction is sought to be conferred under s 76(ii) in any matter arising under any laws made by Parliament, the confines of the legislative powers of the Parliament provide a further limitation.
No doubt it is within the competence of Parliament to bestow upon a federal court the attributes of a superior court to the extent that the Constitution permits. That is all that s 5(2) of the [Federal Court Act] can do in relation to the Federal Court."[30]
As the observations of Dawson J make clear, it is necessary to determine what the Constitution permits in order to determine what is involved in the notion that the Federal Court is "a superior court of record".
[29](1982) 151 CLR 491 at 509.
[30](1985) 157 CLR 351 at 392-393. See also R v Hickman; Ex parte Fox and Clinton (1945) 70 CLR 598 at 616 per Dixon J; R v Blakeley; Ex parte Association of Architects &c of Australia (1950) 82 CLR 54 at 89 per Fullagar J; DMW v CGW (1982) 151 CLR 491 at 501 per Gibbs CJ, 509 per Dawson J.
It was held in Residual Assco[31] that the Parliament has power to confer authority on a federal court to decide whether or not it has jurisdiction. In that case, s 19 of the Federal Court Act and s 39B(1A)(c) of the Judiciary Act 1903 (Cth) were identified as the sources of the Federal Court's power to decide its own jurisdiction[32]. And the Parliament's power to legislate to that effect was sourced to ss 71, 76(ii) and 77(i) of the Constitution[33]. In addition to those provisions, reference should be made to s 51(xxxix) of the Constitution. That sub-section confers legislative power with respect to "matters incidental to the execution of any power vested by this Constitution ... in the Federal Judicature".
[31](2000) 74 ALJR 1013; 172 ALR 366.
[32](2000) 74 ALJR 1013 at 1016 [8] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; 172 ALR 366 at 369-370 referring to DMW v CGW (1982) 151 CLR 491 at 507 per Mason, Murphy, Wilson, Brennan and Deane JJ; R v Ross-Jones; Ex parte Green (1984) 156 CLR 185 at 194 per Gibbs CJ, 213 per Wilson and Dawson JJ, 215-216 per Brennan J, 222-223 per Deane J; R v Gray; Ex parte Marsh (1985) 157 CLR 351 at 374-375 per Mason J.
[33](2000) 74 ALJR 1013 at 1017 [13] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; 172 ALR 366 at 371.
The power vested by the Constitution in the Federal Judicature is the judicial power of the Commonwealth. And it is clearly incidental to that power for a federal court to decide whether or not it has jurisdiction in a matter and to make a binding determination in that regard. Of course, a decision of that kind is necessarily subject to the parties' constitutional right to seek relief pursuant to s 75(v) of the Constitution. Indeed, the presence of s 75(v) in Ch III of the Constitution indicates, in my view, that the Constitution expressly contemplates that federal courts might be empowered to make decisions with respect to their own jurisdiction which are binding until set aside.
In establishing the Federal Court as a "superior court of record", the Parliament has, at the very least, validly authorised that Court to make a binding determination on the question whether or not it has jurisdiction in a matter, subject only to the parties' right to appeal or to seek relief pursuant to s 75(v) of the Constitution. And, if the Federal Court determines that it has jurisdiction, it is obliged, subject only to limited and well recognised exceptions[34], to exercise that jurisdiction to determine the rights and liabilities in issue. That is the nature of judicial power. The practical consequence of those two considerations is that, by operation of s 109 of the Constitution, orders of the Federal Court, even if made without jurisdiction, are final and binding unless set aside on appeal or pursuant to s 75(v) of the Constitution.
[34]In general terms, those exceptions relate to proceedings which are an abuse of process, including on grounds of forum non conveniens. See Oceanic Sun Line Special Shipping Company Inc v Fay (1988) 165 CLR 197; Jago v District Court (NSW) (1989) 168 CLR 23; Voth v Manildra Flour Mills Pty Ltd (1990) 171 CLR 538; Williams v Spautz (1992) 174 CLR 509; CSR Ltd v Cigna Insurance Australia Ltd (1997) 189 CLR 345.
It is necessary to elaborate upon the process by which s 109 operates to make orders of the Federal Court final and binding until set aside. In the case of a Federal Court order made within jurisdiction, a State law providing that the rights and liabilities of the parties were other than as contained in that order or permitting a State court to provide in a manner contrary to it would be inconsistent with a law of the Commonwealth conferring jurisdiction on the Federal Court in the matter in which the order was made. A State law of the former kind would be invalid for direct inconsistency because it would "alter, impair or detract from" the operation of the law conferring jurisdiction on the Federal Court[35]. A State law of the latter kind would be invalid for what is usually referred to as "operational inconsistency"[36].
[35]See Victoria v The Commonwealth ("The Kakariki") (1937) 58 CLR 618 at 630 per Dixon J. See also Stock Motor Ploughs Ltd v Forsyth (1932) 48 CLR 128 at 136 per Dixon J; Australian Broadcasting Commission v Industrial Court (SA) (1977) 138 CLR 399 at 406 per Stephen J; Metal Trades Industry Association v Amalgamated Metal Workers' and Shipwrights' Union (1983) 152 CLR 632 at 642-643 per Gibbs CJ, Wilson and Dawson JJ; Australian Mutual Provident Society v Goulden (1986) 160 CLR 330 at 337, 339 per Gibbs CJ, Mason, Brennan, Deane and Dawson JJ; Commonwealth v Western Australia [Mining Act Case] (1999) 196 CLR 392 at 415 [54] per Gleeson CJ and Gaudron J, 440 [139] per Gummow J, 449 [170] per Kirby J.
[36]Victoria v The Commonwealth ("The Kakariki") (1937) 58 CLR 618; Re Tracey; Ex parte Ryan (1989) 166 CLR 518 at 599-600; Commonwealth v Western Australia [Mining Act Case] (1999) 196 CLR 392 at 417 [61]-[62] per Gleeson CJ and Gaudron J, 439 [138] per Gummow J, 449 [171] per Kirby J.
In the case of a Federal Court order made without jurisdiction, there would be an inconsistency of a different kind. To avoid inconsistency of the kind described in relation to Federal Court orders made within jurisdiction, a State law providing that the rights and liabilities of persons bound by an order of the Federal Court were other than as contained in that order or permitting a State court to provide in a manner contrary to it must proceed on the hypothesis that the Federal Court order was made without jurisdiction.
The hypothesis that a Federal Court order was made without jurisdiction, and, hence, a State law based on that hypothesis, would be directly inconsistent with s 5(2) of the Federal Court Act in so far as that sub-section confers authority on that Court to determine whether or not it has jurisdiction, subject only to appeal or the granting of relief pursuant to s 75(v) of the Constitution. And that is so even if the Federal Court's order is concerned only with the rights and obligations of the parties to the litigation because, by necessary implication, it would also embody a decision or order that the proceedings were within jurisdiction[37].
[37]See Peacock v Bell and Kendal (1667) 1 Wms Saund 73 [85 ER 84]; DMW v CGW (1982) 151 CLR 491; R v Ross-Jones; Ex parte Green (1984) 156 CLR 185 at 216 per Brennan J.
It follows from what has been said with respect to s 5(2) of the Federal Court Act that an order of the Federal Court made without jurisdiction is not a nullity. Rather, by reason that that Court has authority to make a binding decision that it has jurisdiction in a matter, whether pursuant to s 5(2) alone, or s 5(2) in combination with s 19 of the Federal Court Act and s 39B(1A)(c) of the Judiciary Act, a Federal Court order is final and binding unless and until set aside on appeal or pursuant to s 75(v) of the Constitution. It is, thus, necessary to consider whether, as the applicants contend, there is inconsistency between the State Jurisdiction Acts and the Federal Court Act.
"Cover the field" inconsistency
As earlier indicated, a State cannot legislate inconsistently with a Federal Court order which has not been set aside. Moreover, a State cannot legislate with respect to the force or effect of a Federal Court order. That is not because of s 109 of the Constitution. It is because a State simply does not have any power to legislate with respect to the orders of a federal court[38]. However, the State Jurisdiction Acts are not invalid on that account. That is because they are not concerned with the force or effect of federal court orders.
[38]See generally Commissioner of Stamp Duties (NSW) v Owens [No 2] (1953) 88 CLR 168 at 169 per Dixon CJ, Williams, Webb, Fullagar and Kitto JJ; Pedersen v Young (1964) 110 CLR 162 at 165 per Kitto J, 167 per Menzies J; John Robertson & Co Ltd v Ferguson Transformers Pty Ltd (1973) 129 CLR 65 at 79 per Menzies J, 84 per Walsh J, 87-89 per Gibbs J, 93 per Mason J; Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at 35 [41] per Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ.
The State Jurisdiction Acts proceed on the basis that certain federal court orders are infirm in the sense that they are liable to be set aside and, even if not set aside, their enforcement is liable to be prohibited[39]. Relevantly, the State Jurisdiction Acts operate by first conferring statutory rights and imposing statutory liabilities which correspond precisely with those embodied in the infirm orders (s 6) and, then, by assigning to those statutory rights and obligations the consequences that would have come about if those rights and obligations had been embodied in orders of a State Supreme Court (ss 7, 8 and 10).
[39]See the orders in Re Brown; Ex parte Amann reported sub nom Re Wakim; Ex parte McNally (1999) 198 CLR 511.
Although the State Jurisdiction Acts are not concerned with the force or effect of federal court orders, they do operate with respect to the same rights and obligations as are embodied in those orders. It is, thus, necessary in this case to consider whether they are invalid in their application to rights and obligations embodied in orders of the Federal Court because s 5(2) of the Federal Court Act evinces an intention that that should be the only law on the field covered by that sub-section.
It is convenient, at this stage, to proceed on the assumption that Parliament intended to legislate exclusively and exhaustively with respect to the field covered by s 5(2) of the Federal Court Act. On that assumption, it is necessary to identify "the field" which that sub-section covers[40]. It is clear that the only relevant field which it covers is that of the rights and liabilities of the parties bound by an order of the Federal Court which has not been set aside on appeal or pursuant to s 75(v) of the Constitution. It is not directed to their rights and liabilities if and when an order is set aside. Thus, to the extent, if any, that the State Jurisdiction Acts operate if and when an order of the Federal Court is set aside – a question that will be considered later in these reasons – there is no "cover the field" inconsistency between those Acts and s 5(2) of the Federal Court Act.
[40]See Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466 at 489-490 per Isaacs J.
It is necessary now to consider the question whether, in enacting s 5(2) of the Federal Court Act, Parliament intended to legislate exclusively and exhaustively with respect to the rights and obligations of parties bound by an order of the Federal Court which, although made without jurisdiction, has not been set aside. As earlier indicated, an order of that kind is one that is liable to be set aside for want of jurisdiction, either on appeal or pursuant to s 75(v) of the Constitution and, even if not set aside, prohibition may issue pursuant to s 75(v) of the Constitution to prevent enforcement of the rights and obligations embodied in the order.
Given the very nature of the infirmity inherent in an order of the Federal Court which has been made without jurisdiction, it is not to be supposed that Parliament intended, by s 5(2) of the Federal Court Act, to evince an intention that, if it did not legislate with respect to the rights and liabilities of the parties to the order[41] or if it lacked legislative power in that regard, the Parliaments of the States should not legislate consistently with the order in question by conferring rights and imposing obligations corresponding precisely with those embodied in the order. And once that is accepted, it follows that Parliament did not intend to prevent a State from legislating to provide a means for the enforcement of those corresponding rights and obligations.
[41]As it might have done with respect to the orders in issue in this case pursuant to s 51(xx) of the Constitution which authorises laws with respect to "foreign corporations, and trading or financial corporations" or pursuant to its power under s 51(xvii) to legislate with respect to insolvency.
As the State Jurisdiction Acts are not invalid by reason of "cover the field" inconsistency, it is necessary to consider whether, and, if so, to what extent there is direct inconsistency between those Acts and the Federal Court Act.
Direct inconsistency: ss 6, 7(2) and 10 of the State Jurisdiction Acts
It is not in issue that, to the extent that s 6 of the State Jurisdiction Acts confers rights and imposes liabilities which correspond with those embodied in a Federal Court order made without jurisdiction, there is no direct inconsistency between it and the Federal Court Act. Nor is there any direct inconsistency between s 7(1) of the State Jurisdiction Acts and the Federal Court Act. That is because s 7(1) is directed to the exercise and enforcement of the rights and liabilities which the State Jurisdiction Acts create, not those embodied in the Federal Court order. However, different considerations apply to s 6, to the extent that it purports to confer a right of appeal as elaborated in s 7(2), and, also, to s 10 of the State Jurisdiction Acts.
As already indicated, a Federal Court order is binding until set aside either on appeal or pursuant to s 75(v) of the Constitution. An order of the Supreme Court of a State providing for rights and obligations different from those embodied in a Federal Court order, whether made "on appeal" under s 6, as elaborated in s 7(2) of the State Jurisdiction Acts, or by way of variation under s 10, would be directly inconsistent with that Federal Court order. More precisely for the purposes of s 109 of the Constitution, which is concerned with inconsistency between laws[42], s 6, to the extent of the "right of appeal" elaborated in s 7(2), and s 10 of the State Jurisdiction Acts are inconsistent with s 5(2) of the Federal Court Act.
[42]Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466; Colvin v Bradley Brothers Pty Ltd (1943) 68 CLR 151; Blackley v Devondale Cream (Vic) Pty Ltd (1968) 117 CLR 253; Mabo v Queensland (1988) 166 CLR 186; Western Australia v The Commonwealth (Native Title Act Case) (1995) 183 CLR 373.
At one level, there would be operational inconsistency between the State Jurisdiction Acts and the Federal Court Act if, in exercise of the "appellate power" conferred by s 6 and elaborated in s 7(2), or, pursuant to the power of variation conferred by s 10 of the State Jurisdiction Acts, an order were made which was inconsistent with a subsisting Federal Court order. At a more fundamental level, however, there is direct inconsistency between s 6, to the extent of the "right of appeal" elaborated in s 7(2), and s 10 of the State Jurisdiction Acts and s 5(2) of the Federal Court Act because the former provisions proceed on the assumption that certain Federal Court orders are of no legal effect. And that assumption is inconsistent with s 5(2) of the Federal Court Act because the latter creates the Federal Court as a "superior court of record", entailing, as that does, the consequence that its orders are final and binding until set aside.
It is important to note, however, that because s 5(2) of the Federal Court Act only entails the consequence that Federal Court orders are binding until set aside, there is no inconsistency between that sub-section and s 6, to the extent of the "right of appeal" elaborated in s 7(2), and s 10 of the State Jurisdiction Acts to the extent, if any, that those Acts operate by reference to orders that have been set aside.
Because there is direct inconsistency between, on the one hand, s 6, to the extent that it allows for the "right of appeal" elaborated in s 7(2), and s 10 of the State Jurisdiction Acts and, on the other, s 5(2) of the Federal Court Act, it is necessary to consider whether the State Jurisdiction Acts can be read down to the extent that they are not inconsistent with that Act. For the purposes of this case, it is necessary to consider that question only in relation to the South Australian and Queensland State Jurisdiction Acts. Before turning to that question, however, it is convenient to consider whether, as the applicants contend, the State Jurisdiction Acts have no effect on the rights and liabilities of persons who are parties to a judgment or order that has been set aside on appeal or pursuant to s 75(v) of the Constitution.
State Jurisdiction Acts: meaning of "ineffective judgment''
Because s 6 of the State Jurisdiction Acts confers rights and imposes liabilities by reference to an "ineffective judgment", the operation of those Acts is to be determined by the meaning of that term, the statutory definition of which is set out earlier in these reasons. For present purposes, it is sufficient to note that "ineffective judgment" is relevantly defined as "a judgment ... given or recorded ... in the purported exercise of jurisdiction purporting to have been conferred ... by a relevant State Act".
It is a fundamental rule of construction that statutory definitions are to be read according to their terms and not as subject to limitations or qualifications which their terms do not require[43]. There is nothing in the definition of "ineffective judgment" which would confine its meaning to judgments which have not been set aside. On the contrary, the words "given or recorded" indicate that that definition is concerned with judgments which, as a matter of historical fact, have been given or recorded, and not simply those which subsist as a matter of law. Accordingly, in my view, the State Jurisdiction Acts operate with respect to ineffective judgments, whether or not they have been set aside.
[43]See Owners of "Shin Kobe Maru" v Empire Shipping Co Inc (1994) 181 CLR 404 at 420-421. See also Australian Softwood Forests Pty Ltd v Attorney-General (NSW); Ex rel Corporate Affairs Commission (1981) 148 CLR 121 at 130 per Mason J; Slonim v Fellows (1984) 154 CLR 505 at 513 per Wilson J.
State Jurisdiction Acts: reading down
For present purposes, it is only necessary to consider whether the South Australian and Queensland State Jurisdiction Acts can be read down so as to operate to the extent that they are not inconsistent with the Federal Court Act. In this regard it should be noted that the Acts Interpretation Act 1915 (SA) relevantly provides, in s 13:
" A statutory ... instrument ... will be read and construed ... so that, where a provision of the instrument, or the application of a provision of the instrument to any person or circumstances, is in excess of ... power, the remainder of the instrument, or the application of the provision to other persons and circumstances, is not affected."
So, too, s 9(3) of the Acts Interpretation Act 1954 (Q) relevantly provides that:
"... if the application of a provision of an Act to a person, matter or circumstance would, apart from this section, be interpreted as exceeding power, the provision's application to other persons, matters or circumstances is not affected."
No provision of the State Jurisdiction Acts would be given any different operation if read down so as not to confer a "right of appeal" or to permit of variation if an "ineffective judgment" has not been set aside[44]. The South Australian and Queensland State Jurisdiction Acts should be read down accordingly.
[44]See generally with respect to reading down, Australian Railways Union v Victorian Railways Commissioners (1930) 44 CLR 319 at 373-374 per Isaacs CJ; Pidoto v Victoria (1943) 68 CLR 87 at 107-111 per Latham CJ, 118 per Starke J, 130-131 per Williams J; Strickland v Rocla Concrete Pipes Ltd (1971) 124 CLR 468 at 492-493 per Barwick CJ, 503-506 per Menzies J, 515-520 per Walsh J; Victoria v The Commonwealth (Industrial Relations Act Case) (1996) 187 CLR 416 at 501-503 per Brennan CJ, Toohey, Gaudron, McHugh and Gummow JJ.
Repugnancy to Ch III
In considering whether the State Jurisdiction Acts are repugnant to Ch III of the Constitution, it is important to note, at the outset, what those Acts do not do. They do not and do not purport to interfere with the appellate jurisdiction of this Court, the Federal Court or the Family Court. The appellate jurisdiction of this Court and of those Courts may be exercised to set aside an order that was made without jurisdiction. Moreover, the State Jurisdiction Acts do not and do not purport to interfere with this Court's jurisdiction under s 75(v) of the Constitution.
Further, the State Jurisdiction Acts do not, as was contended, "create appeals across jurisdictions". In this regard, it was held in Residual Assco that s 11 of the State Jurisdiction Acts does not permit appellate proceedings pending in the Federal Court or the Family Court to be treated as proceedings in a State Supreme Court[45]. And the "right of appeal" elaborated in s 7(2) of the State Jurisdiction Acts is, in truth, simply the vesting of original jurisdiction in State Supreme Courts to set aside or vary the statutory rights and liabilities conferred or imposed by s 6 of those Acts on the same basis that those Courts might set aside or vary an order on appeal.
[45](2000) 74 ALJR 1013 at 1018 [19] per Gleeson CJ, Gaudron, McHugh, Gummow, Hayne and Callinan JJ; 172 ALR 366 at 372.
Further and contrary to what was put in argument, the State Jurisdiction Acts do not purport to allow an appeal from the Full Federal Court to this Court "via a deemed Full State Supreme Court decision". The State Jurisdiction Acts do not deem a decision of the Full Federal Court to be a decision of a Full Court of a Supreme Court. Relevantly, they create statutory rights and liabilities which may be enforced as if an "ineffective judgment of ... a Full Court of the Federal Court ... had been a valid judgment of the Full Court of the Supreme Court" (s 6(b)) and provide for the enforcement of those rights and liabilities as if "conferred [or] imposed ... by a judgment of the Supreme Court" (s 7(1)).
Once it is appreciated that the State Jurisdiction Acts do not interfere with the jurisdiction of this or other federal courts, the argument that they are, on that account or to that extent, repugnant to Ch III of the Constitution must be rejected.
The argument that the State Jurisdiction Acts are repugnant to Ch III of the Constitution because of their impact on State Supreme Courts is based on the premise that the State Jurisdiction Acts "make judicial orders by legislative decree ... impose decisions on a Supreme Court which purport to have been made by that Court in the exercise of judicial power, but which [were] not; [and] dress-up a legislative decree as the 'order' of a Court". It is put that, by reason of these considerations, the Acts undermine public confidence in the State Supreme Courts and, because the Constitution contemplates that those Courts may be invested with federal jurisdiction, they are repugnant to Ch III[46].
[46]As to the effect of Ch III on the Supreme Courts of the States, see Kable v Director of Public Prosecutions (NSW) (1996) 189 CLR 51.
So far as concerns State Supreme Courts, the State Jurisdiction Acts do two things. Leaving aside the question of inconsistency, which does not bear on this aspect of the matter, the State Jurisdiction Acts first confer original jurisdiction on State Supreme Courts to set aside, vary or modify the statutory rights and liabilities conferred by those Acts either under ss 6 and 7(2), as if on appeal, or pursuant to s 10. They then allow for the enforcement of the rights and liabilities conferred by those Acts as if they were orders of a Supreme Court.
There is nothing novel in the conferral of jurisdiction on State Supreme Courts to vary rights and liabilities. For example, the Supreme Courts of the States have long had jurisdiction to order provision for the dependant of a deceased person out of his or her estate, thus varying both the dependant's rights on intestacy or pursuant to the testamentary disposition in question and, also, the rights of others entitled to share in the estate. There is, in my view, no relevant distinction between jurisdiction of that kind and the jurisdiction conferred by the State Jurisdiction Acts. More precisely, there is no basis upon which it can be said that the exercise by State Supreme Courts of the jurisdiction and powers conferred by the State Jurisdiction Acts would undermine public confidence in those Courts.
Nor, in my view, can it be said that the enforcement of the statutory rights and liabilities conferred and imposed by the State Jurisdiction Acts as if they were orders of a Supreme Court would undermine confidence in that Court. In this regard, it should be remembered that, in the case of a federal court order that has not been set aside, the rights and liabilities which may be enforced are rights and liabilities which correspond precisely with those embodied in the federal court order and which could have been the subject of an order made by the Supreme Court in the exercise of its judicial powers and functions. In the case of a federal court order that has been set aside, they are rights and liabilities which have been modified or are capable of modification by a Supreme Court, either pursuant to the "right of appeal" elaborated in s 7(2) or the power of variation conferred by s 10 of the State Jurisdiction Acts.
Given that the rights and liabilities which may be enforced have their origins in a court order and may be the subject of judicial modification if the anterior federal court order has been set aside, the enforcement of those rights and liabilities, "as if they were orders of the Supreme Court", involves no repugnancy to Ch III of the Constitution.
Conclusion and orders
The State Jurisdiction Acts are valid save to the extent that they purport to allow for the modification of rights and liabilities embodied in a federal court order that has not been set aside. As the winding up orders and the funding orders were made without jurisdiction and circumstances may arise which would justify the modification of the rights and liabilities embodied in those orders, time should be extended for the bringing of the applications for certiorari and certiorari should issue to quash those orders which are the subject of applications in that regard. Additionally, there should be liberty to apply in respect of the order made in SG3050 of 1995. No question then arises as to prohibition to the Federal Court.
As the State Jurisdiction Acts are valid, save to the extent indicated, the applications for prohibition directed to the Liquidator must be dismissed. That being so, the applicants should pay the costs of the Liquidator and the ninth respondent (the Deputy Commissioner of Taxation), who was joined as a party to both applications by the order of Gummow J made on 3 April 2000, in these proceedings.
McHUGH J. The Federal Court of Australia, relying on what has become known as the cross-vesting legislation, purported to make orders in connection with the winding up and liquidation of the companies involved in these proceedings. In Re Wakim; Ex parte McNally[47], however, this Court held that the cross-vesting legislation was invalid in so far as it purported to confer jurisdiction on the Federal Court and the Family Court of Australia to determine matters arising only under State law. Consequently, the Federal Court lacked jurisdiction to make the orders. The State of South Australia and other States have enacted legislation to remedy some of the consequences that arise from that lack of jurisdiction. One remedy gives the parties to the invalid orders the same rights and liabilities as they would have had if the orders had been valid.
[47](1999) 198 CLR 511.
The applicants in these proceedings contend that the orders, having been made by a federal court without jurisdiction, should be quashed and that the State remedial legislation is invalid because it purports to interfere with proceedings in the Federal Court. They further ask this Court to prohibit any further steps being taken under the authority of those orders. The liquidator of the companies, on the other hand, contends that the orders are merely voidable and effective until set aside and that in any event the State legislation makes the rights and liabilities of parties the same as if the orders affecting them had been validly made.
The issue in these applications then is whether the liquidator is entitled to rely on the continuing effect of the orders until they are quashed or set aside or, alternatively, whether he can rely on the remedial State legislation to obtain what was given by those orders.
In my opinion, the impugned State legislation is valid. The invalid orders of the Federal Court are not nullities because that Court had jurisdiction to determine – even erroneously – that it had jurisdiction under a purported law of the Parliament. Nevertheless, the law of the Commonwealth authorising the making of the orders does not render inoperative the State legislation which created a fresh set of rights and liabilities by reference to, but without interfering with, those orders. The Parliament of the Commonwealth can only make laws within the powers assigned to it by the Constitution. If the Parliament has no power to give a federal court jurisdiction to make orders with respect to a subject matter, it cannot make a law that a federal court order with respect to that subject matter is binding until set aside. That being so, there is no conflict between the State legislation and the invalid orders of the Federal Court. Furthermore, although the State Supreme Court must determine whether an order of the Federal Court is valid or effective, it does so in the exercise of federal jurisdiction conferred by the Judiciary Act 1903 (Cth) ("the Judiciary Act"). Any determination that it makes is therefore made under a federal statute and the findings or orders of the State Supreme Court cannot raise any question of s 109 inconsistency – direct or operational.
The factual background
The facts which led to the Federal Court making various winding up orders, orders appointing Mr Macks as liquidator of certain companies, and an order that Mr Macks had power under the Corporations Law to enter into a funding arrangement ("the relevant orders") are summarised in the reasons of Hayne and Callinan JJ.
In June 1999, this Court delivered its reasons and orders in Re Wakim. Relevantly, the Court held that s 9(2) of the Jurisdiction of Courts (Cross-vesting) Act 1987 (Cth) and s 56(2) of the Corporations Act 1989 (Cth) ("the cross-vesting legislation") were invalid. It is clear that the relevant orders were made by the Federal Court pursuant to the purported conferral of jurisdiction under the cross-vesting legislation and that they were made without jurisdiction. They were also all made before this Court delivered its reasons and orders in Re Wakim.
On 19 August 1999, the Federal Courts (State Jurisdiction) Act 1999 (SA) ("the State Act") came into effect. The other States have enacted largely identical legislation. The State Act is remedial legislation directed at preserving the rights and liabilities of persons as they had been determined by the Federal Court[48] in proceedings before it, despite the Federal Court's lack of jurisdiction to determine those proceedings.
[48]Or the Family Court – see definition of "federal court" in s 3 of the State Act.
The scheme of the State Act
It is convenient to give an outline of the scheme of the State Act and to give some indication of the interactions between groups of provisions before considering those provisions in more detail.
The idea underlying the scheme is that the State Act will give the parties to invalid judgments made by the Federal Court exactly the same rights and liabilities as they would have had if the judgments were valid. If the judgment of the Federal Court was ineffective, s 6 declares that the rights and liabilities of all persons (it will be convenient to refer to these as "s 6 rights and liabilities") are the same as if each ineffective judgment of the Federal Court had been a valid judgment of the Supreme Court of South Australia. The term "ineffective judgment" is defined in s 4. Sections 7 and 8 of the State Act are directed, respectively, at the effect of s 6 rights and liabilities, and of things done or omitted to be done under or in relation to s 6 rights and liabilities.
Section 9 declares that, if an earlier "ineffective judgment" is replaced by a later "ineffective judgment", s 6 has no effect in respect of the earlier judgment. Section 10 gives broad powers to the Supreme Court to vary s 6 rights and liabilities. Section 12 makes provision for any interference, or failure to comply, with s 6 rights and liabilities. Section 14 declares that the State Act does not apply to a judgment of the Federal Court which, before the commencement of the section, has been declared invalid or quashed or overruled by the Full Court of the Federal Court on a ground other than of no jurisdiction.
The relief sought by the applicants
The argument which those seeking certiorari advanced took several steps. First, it was said that the orders of a superior court of record are valid until they are set aside. It followed that, by making the Federal Court a superior court of record[338], the Commonwealth Parliament had provided for the effect which orders made by that Court would have. Accordingly, so it was submitted, the provisions of the State Jurisdiction Acts, which sought to attribute some other consequence to Federal Court orders, were inconsistent with a valid Commonwealth law. Those provisions were therefore wholly invalid or, at least, invalid so long as the Federal Court's order had not been quashed or set aside in the exercise of federal judicial power. Each step of the argument requires separate consideration, but before turning to that task it is as well to say something more about why it is necessary to embark on it.
[338]Federal Court of Australia Act 1976 (Cth), s 5(2).
At first sight, the liquidator need not identify the source of his rights and liabilities. He holds office as liquidator in companies that are in liquidation, and has the benefits and burdens of the funding arrangements, either because the relevant Federal Court orders still have effect or because the State Jurisdiction Acts created rights and liabilities in him (and all persons) that are substantially the same as those that the Federal Court orders created. In those circumstances, why is it necessary for the liquidator to demonstrate that his rights and liabilities stem from one source rather than the other? Is it not enough to say that if the Federal Court orders no longer have effect, because, having been made without jurisdiction, they are to be treated as void, he has s 6 rights and liabilities and, conversely, that if the Federal Court orders still have effect and s 6 is invalid by operation of s 109, his rights and liabilities are to be traced to a root of title in the orders of the Federal Court?
That approach, attractive as it may seem at first sight, cannot be adopted. It assumes that one or other source of power is valid. To see whether that is so, it is necessary to identify the nature and extent of any inconsistency between the State and Commonwealth legislation. That process must begin by examining the legislation.
Orders of a superior court of record
It is apparent from the legislature's use of the expression "superior court of record" in s 5(2) of the Federal Court Act that reference was intended to the considerable body of English common law about such courts, including the proposition that, in general, orders made by such a court are valid and binding upon the parties until they are set aside[339].
[339]Scott v Bennett (1871) LR 5 HL 234 at 245 per Martin B; Revell v Blake (1873) LR 8 CP 533 at 544‑545 per Blackburn J.
There can, however, be no unthinking transplantation to Australia of the learning that has built up about superior courts of record in England. The constitutional context is wholly different. Due regard must be had to those differences. It may be right to say that, as a general rule, a decision of a superior court "even if in excess of jurisdiction, is at the worst voidable, and is valid unless and until it is set aside"[340], and that a superior court may, and an inferior court may not, "determine conclusively its own jurisdiction"[341]. But such general statements must always give way to any applicable constitutional limitation. In particular, the apparently general ambit of s 5(2) of the Federal Court Act must be considered against the question of the power of the Parliament to enact it.
[340]Cameron v Cole (1944) 68 CLR 571 at 590 per Rich J.
[341]Cameron v Cole (1944) 68 CLR 571 at 598 per McTiernan J. See also at 604-605 per Williams J; Ousley v The Queen (1997) 192 CLR 69 at 107 per McHugh J, 129‑130 per Gummow J; DMW v CGW (1982) 151 CLR 491 at 507 per Mason, Murphy, Wilson, Brennan and Deane JJ; Ex parte Williams (1934) 51 CLR 545 at 550; Campbell, "Inferior and Superior Courts and Courts of Record", (1997) 6 Journal of Judicial Administration 249.
Section 19 of the Federal Court Act declares that that Court "has such original jurisdiction as is vested in it by laws made by the Parliament". As was noted in the joint judgment in Residual Assco[342], this grant of jurisdiction carries with it the power of the Federal Court to determine whether any particular vesting of original jurisdiction was validly granted to it[343]. Section 39B(1A) of the Judiciary Act 1903 (Cth) goes further, directly conferring original jurisdiction on the Federal Court in any matter "arising under the Constitution, or involving its interpretation"[344] and in any matter "arising under any laws made by the Parliament"[345].
[342](2000) 74 ALJR 1013 at 1016 [8]; 172 ALR 366 at 369‑370.
[343]See also DMW v CGW (1982) 151 CLR 491 at 507 per Mason, Murphy, Wilson, Brennan and Deane JJ; R v Ross‑Jones; Ex parte Green (1984) 156 CLR 185 at 194 per Gibbs CJ, 213 per Wilson and Dawson JJ, 215-217 per Brennan J, 222‑223 per Deane J; R v Gray; Ex parte Marsh (1985) 157 CLR 351 at 374‑375 per Mason J.
[344]s 39B(1A)(b).
[345]s 39B(1A)(c).
In Residual Assco, the joint judgment pointed out[346] that it is necessary to distinguish between separate sources of authority to decide different kinds of questions. The authority to decide whether the Federal Court has jurisdiction was said to stem immediately from s 19 of the Federal Court Act and s 39B(1A)(c) of the Judiciary Act, and ultimately from ss 77(i) and 76(ii) of the Constitution. If the question concerns the constitutional validity of conferral of jurisdiction it is also necessary to recognise that s 39B(1A)(b) and s 76(i) would be engaged. The question would be one arising under the Constitution or involving its interpretation. By contrast, orders which dealt with proceedings on their merits were said to be invalidly made if the jurisdiction to make them depended on invalid legislation[347].
[346](2000) 74 ALJR 1013 at 1016‑1017 [8], [12]-[13]; 172 ALR 366 at 369-371.
[347](2000) 74 ALJR 1013 at 1017‑1018 [13], [17]; 172 ALR 366 at 371-372.
In the argument of the present matters, principal attention was directed to s 5(2) of the Federal Court Act, rather than to s 19. So far as now relevant, s 5(2) deals, not with the ambit of the Federal Court's authority to decide matters, so much as with the consequences that are to be attached to the fact that a decision has been made. It was said to give particular effect (validity until set aside) to orders which the Court made in the exercise of a jurisdiction which it explicitly found to exist, or which, by making a substantive order, it must implicitly have found to exist. What is the power to make a law having that effect?
Those who contended that s 5 is to be given general operation, so that all orders of the Federal Court are valid until set aside, sought to attribute power to enact a provision having that effect to ss 71, 76 and 77 or s 51(xxxix) of the Constitution, or a combination of some of those provisions. Particular reliance was placed on s 71, and it is convenient to deal with that section first.
The argument based on s 71 contained several steps. First, it was submitted, correctly, that the reference in s 71 to "such other federal courts as the Parliament creates" empowers the Parliament to create federal courts. This was said to give the Parliament power to choose what type of court it will create. In particular, it was submitted that s 71 empowered Parliament to choose whether it will create a "superior court of record" (a type of court which is now, and was at the time of federation, well recognised). So much may be accepted. But it by no means follows that the Parliament is thus given power by s 71 to create a court all of whose features correspond with a superior court of record in England. In particular, it does not necessarily follow from the power implicitly given by s 71 to create federal courts that all of the orders, including those made in relation to matters beyond the Commonwealth's legislative competence, may be made binding until set aside.
There are several reasons for rejecting the contention that s 71 does have this effect. First, it gives great breadth of operation to what is an implied power. Secondly, it sits oddly with the express conferral of power to define the jurisdiction of federal courts (that is, their authority to decide) which is a power found in s 77(i). Thirdly, it gives rise to results which are at odds with the place and purpose of Ch III in the Constitution, for it must always be recalled that Ch III "is an exhaustive statement of the manner in which the judicial power of the Commonwealth is or may be vested. … No part of the judicial power can be conferred in virtue of any other authority or otherwise than in accordance with the provisions of Chap III."[348] If a federal court can be given authority to decide only matters arising under any laws made by the Parliament, or in relation to the other matters mentioned in ss 75 and 76, it follows (as was held in Re Wakim) that it cannot, for example, be given authority to decide matters which arise under laws made by State legislatures. To read s 5 as giving binding effect (albeit temporarily) to all orders would be to read it as giving the Federal Court authority to decide matters that do not relate to any matter contemplated by Ch III. Truly, in the traditional metaphor, the stream would have risen above its source.
[348]R v Kirby; Ex parte Boilermakers' Society of Australia (1956) 94 CLR 254 at 270.
It was suggested that any apparent deficiency in the power given by s 71 could be sufficiently supplied by resort to s 51(xxxix) and the power to make laws with respect to "matters incidental to the execution of any power vested by this Constitution in the Parliament … or in the Federal Judicature". It is necessary to identify the power vested by the Constitution in the Parliament or in the Federal Judicature to the execution of which the matter is incidental. In relation to the powers vested in the Federal Judicature, whatever may be the position in relation to this Court, the jurisdiction of other federal courts to decide their own jurisdiction derives not from the Constitution but from an act of Parliament[349]. It follows that s 51(xxxix) cannot provide power to make all orders of those courts binding until set aside, as an incident to the execution of a power vested in the Federal Judicature by the Constitution.
[349]Residual Assco Group Ltd v Spalvins (2000) 74 ALJR 1013 at 1016 [8]; 172 ALR 366 at 369.
If attention is directed to the power vested by the Constitution in the Parliament to create federal courts, we do not accept that it is incidental to that power to make provision for the effect of orders made by those courts. It is unnecessary to consider the operation of the incidental power in connection with the other relevant power vested by the Constitution in the Parliament, the power to define the jurisdiction of federal courts. As these reasons will seek to demonstrate, to the extent to which the Parliament has legislative power so to provide, s 5 may give orders of the Federal Court validity until they are set aside. Section 5 has done so in respect of the orders now in question. That conclusion does not, in our view, depend upon s 51(xxxix) so much as upon ss 77(i) and 76(i) and (ii).
Section 77(i) enables the Parliament to make laws "defining the jurisdiction of any federal court other than the High Court" with respect to any of the matters mentioned in ss 75 and 76. Of the matters identified in those sections, ss 76(i) and (ii) are of most relevance, referring respectively to matters "arising under this Constitution, or involving its interpretation" and matters "arising under any laws made by the Parliament".
Section 76(ii) requires identification of the "law made by the Parliament" in relation to which a "matter" is said to arise. That law must, of course, be a law which is itself supported by a head of Commonwealth power, whether found in s 51 of the Constitution or elsewhere. Because the law under which the matter arises must be a valid law of the Parliament, ss 77(i) and 76(ii) cannot empower the Parliament to enact a law which would give binding effect to all orders made by a federal court, regardless of whether they have a sufficient connection with a relevant head of power. It is, however, necessary to explore that conclusion further.
There seems little difficulty in concluding that a law which "defines" the jurisdiction of a federal court with respect to a matter arising under a law made by the Parliament could go on to attribute certain consequences to the judicial resolution of the matter. In particular, there seems little difficulty in saying that, as part of defining the authority of a federal court to decide a matter, the Parliament may provide that orders made to quell the controversy will be binding until set aside. Power to make such a provision is found in s 77(i) and the power to define the jurisdiction of federal courts with respect to s 76(ii) matters.
The inquiry must, therefore, focus upon the authority to decide which has been invoked. It is convenient to continue the discussion by reference to the particular orders now in question. Each of those orders was made under the Corporations Law in the exercise of jurisdiction which it was thought was conferred by the combination of s 56 of the Commonwealth Corporations Act and s 42 of the relevant State's Corporations Act. It was held in Re Wakim that this jurisdiction was not validly conferred. By making the orders the Federal Court must, however, implicitly have found there to be jurisdiction to make them[350]. The authority to decide whether it had jurisdiction was given to the Federal Court by the Federal Court Act and the Judiciary Act. It was not given by the Corporations Law. The contention now advanced, that the winding up and funding orders are invalid, is a challenge to the conclusion which the Federal Court reached about its jurisdiction. It is not a challenge to whether the orders were otherwise rightly made. That is, the challenge is to the Federal Court's exercise of the authority to decide conferred on it by s 19 of the Federal Court Act and s 39B(1A) of the Judiciary Act, and it is a matter arising under those laws.
[350]R v Ross‑Jones; Ex parte Green (1984) 156 CLR 185 at 216 per Brennan J; DMW v CGW (1982) 151 CLR 491 at 507 per Mason, Murphy, Wilson, Brennan and Deane JJ.
The present challenge to the Federal Court's orders therefore turns on the scope of the authority given to the Court by those sections. That authority is not, in its terms, confined, and is therefore as extensive as Commonwealth constitutional power permits. The authority given by those sections is supported not just as an incident of each substantive head of legislative power[351] but, if there is a question whether any of those heads of power is validly engaged, by s 76(i). Section 76(i) is engaged in these matters because the question of whether the Federal Court had jurisdiction was itself a question arising under the Constitution and involving its interpretation.
[351]cf R v Hughes (2000) 74 ALJR 802; 171 ALR 155.
It follows that so much of the order as asserts the existence of jurisdiction is an order made in a matter which arises under laws made by the Parliament (the Federal Court Act and the Judiciary Act) and in a matter arising under the Constitution and involving its interpretation. It is, therefore, competent for the Parliament to provide, pursuant to ss 77(i) and 76(i) and (ii), that the order quelling the controversy about jurisdiction will be binding until set aside. It is not to the point to say that the particular subject matter of the controversy was not in fact a subject matter which fell within jurisdiction validly conferred on the Court. What is relevant is that, in their present operation, the Federal Court Act and the Judiciary Act are within power, that the assertion of jurisdiction by the Court takes place pursuant to those Acts, and that as a result the Parliament can validly give the Court power to decide its jurisdiction in a way that will be valid until set aside.
The practical consequence of this conclusion is that orders made by the Federal Court are valid until they are set aside. That is so because implicit in an assertion of jurisdiction is the conclusion about the constitutional validity of that assertion. For the reasons given earlier, that authority to decide and the power to provide that the order is binding until set aside is sufficiently rooted in ss 77 and 76.
It follows that it is not helpful to examine the questions in terms of a distinction between void and voidable orders. That is a distinction which, as Wade points out, will often be of little use, and then, if at all, only as a shorthand way of describing a conclusion reached by a process of reasoning rather than as an analytical tool[352]. But whether or not that is so, it is a distinction which is not helpful in the present context.
[352]Wade and Forsyth, Administrative Law, 7th ed (1994) at 339-344.
Nor is it useful to consider the way in which the courts of the United States have approached the question of the effect to be given to orders made without a sufficient constitutional foundation. The approach adopted in those cases[353] is much affected by the different constitutional context in which they are decided, and by the development of notions of prospective overruling which have been rejected by this Court[354]. It is necessary, in this country, to consider the problem by reference to the provisions of Ch III.
[353]Chicot County Drainage District v Baxter State Bank 308 US 371 (1940); Harper v Virginia Department of Taxation 509 US 86 (1993).
[354]Ha v New South Wales (1997) 189 CLR 465 at 503-504 per Brennan CJ, McHugh, Gummow and Kirby JJ, 515 per Dawson, Toohey and Gaudron JJ.
Inconsistency
Section 6 of the State Jurisdiction Acts declares the rights and liabilities of all persons to be, and always to have been, the same as if each ineffective judgment of a single judge of the Federal Court had been a valid judgment of a single judge of the Supreme Court. Section 6 does not seek to add to or subtract from whatever may be the continuing effect of an order made by the Federal Court.
The rights and liabilities created by s 6 are, in almost all respects, parallel to and identical with the rights and liabilities under the Federal Court's order. But there is not complete identity. First, and most obviously, whatever rights and liabilities may flow from an "ineffective judgment" of the Federal Court are defeasible. They are not enforceable if the Federal Court's order is quashed or set aside. Secondly, the rights and liabilities which s 6 creates are the rights and liabilities that would flow from a Supreme Court judgment to the same effect. Thus the ancillary rights which might thereafter be exercised (as, for example, by way of enforcement) may differ from those that could be exercised in respect of the Federal Court order. Thirdly, and this may be no more than a particular species of the genus of differences referred to in the second point, any rights to dispute or vary s 6 rights differ from those that exist in respect of the Federal Court order. For example, there can be no resort to s 75(v) of the Constitution to quash s 6 rights and liabilities. The only means of challenge to the rights and liabilities created by s 6(a) is by appeal to the Supreme Court or by variation under s 10. (It matters not for this purpose whether a right of appeal is implicit in s 6 or given by s 7.) Rights and liabilities declared by s 6(b) by reference to an order of a Full Court of the Federal Court may not be open to appeal.
It may well be that the differences to which we have pointed are differences which follow inevitably from the terms of s 6. Some of the differences are, however, emphasised by consideration of the appeal rights referred to in s 7 and the provision in s 10 for modification of s 6 rights. The applicants fastened upon these differences in aid of their contention that some provisions of the State Jurisdiction Acts (particularly ss 6 and 7) are inconsistent with the Federal Court Act and, therefore, invalid by operation of s 109 of the Constitution.
Several bases of inconsistency were advanced. It was said that there was direct inconsistency between the Federal Court Act (and the effect which it gives to extant orders of the Federal Court) and s 6. It was said that there was indirect inconsistency because the Federal Court Act covered the field of proceedings in the Federal Court and the State Jurisdiction Acts purported to enter that field by creating rights and liabilities by reference to Federal Court orders and then providing for appellate review of those rights otherwise than by the Federal Court. It was said that there would be operational inconsistency as the rights and liabilities of the parties under the State Jurisdiction Acts diverged from those which the Federal Court had created by its order. It is convenient to deal first with the arguments for direct and indirect inconsistency, and then to turn to questions of operational inconsistency.
Direct and indirect inconsistency
It is essential to bear steadily in mind that the State Jurisdiction Acts do not, in their terms, seek to "alter, impair or detract from"[355] the operation of an order made by the Federal Court. They seek to create separate rights and liabilities, using the order of the Federal Court only as a point of historical reference. They provide for the variation or adjustment of the rights and liabilities which are thus created, not for the variation or adjustment of Federal Court orders. For this reason, there is no direct inconsistency between that Act (or the Federal Court order, the factum through which the Federal Court Act operates[356]) and the State Jurisdiction Acts. They simply do not intersect.
[355]Victoria v The Commonwealth (1937) 58 CLR 618 at 630 per Dixon J. See also Stock Motor Ploughs Ltd v Forsyth (1932) 48 CLR 128 at 136 per Dixon J.
[356]See, for example, T A Robinson & Sons Pty Ltd v Haylor (1957) 97 CLR 177 at 182-183; Ex parte McLean (1930) 43 CLR 472 at 484 per Dixon J.
Any consideration of indirect, or covering the field, inconsistency requires the identification of the field which the Commonwealth legislation has marked out. It may be accepted that, as the applicants contended, the Federal Court Act is intended to cover the field of proceedings in the Federal Court. It may further be accepted that that Act is intended to be the only legislation which deals with the subject of the extent to which orders of the Federal Court are to have binding effect. Finally, it may be accepted that the bare fact that an identical rule of conduct is prescribed by Commonwealth and State legislation does not conclude the question of possible inconsistency[357].
[357]Ex parte McLean (1930) 43 CLR 472 at 483 per Dixon J.
Here, however, there is no intrusion by the State legislatures upon any field covered by Commonwealth law. The rights and liabilities which the State Acts create, and for the adjustment or variation of which they provide, do not derive from what the Federal Court has done. The order of the Federal Court is, as we have said, no more than a factual point of reference for the creation of those rights and liabilities.
In this respect, the position is not substantially different from the circumstances considered in R v Humby; Ex parte Rooney[358], which concerned s 5 of the Matrimonial Causes Act 1971 (Cth). As Stephen J said of the provisions of that section[359]:
"Neither of these sub‑sections purports to effect a 'validation' of purported decrees …
What the two sub‑sections do is this: sub‑s (3) declares the rights, liabilities, obligations and status of individuals to be and always to have been the same as if purported decrees had in fact been made by a single judge of a Supreme Court. It does not deem those decrees to have been made by a judge nor does it confer validity upon them; it leaves them, so far as their inherent quality is concerned, as they were before the passing of this Act. They retain the character of having been made without jurisdiction, as was decided in Knight v Knight[360]; as attempts at the exercise of judicial power they remain ineffective. Instead, the sub‑section operates by attaching to them, as acts in the law, consequences which it declares them to have always had and it describes those consequences by reference to the consequences flowing from the making of decrees by a single judge of the Supreme Court of the relevant State.
Sub‑section (4) deals similarly with all proceedings, matters, decrees, acts and things affecting a party to proceedings in which a purported decree was made. It does not validate them but instead attaches to them, retrospectively, the same force and effect as would have ensued had the purported decree been made by a judge of a Supreme Court."
[358](1973) 129 CLR 231.
[359](1973) 129 CLR 231 at 242-243.
[360](1971) 122 CLR 114.
Humby might be seen as the converse of the present case in that the legislation in issue there was Commonwealth legislation relating to purported decrees pronounced by State officers. But those differences do not suggest some different conclusion about inconsistency. What is important here, as it was in Humby, is that the rights created by the State Act are distinct from whatever may be the rights which flow from the Federal Court order and the State Acts do not seek to validate or vary the latter rights. We turn then to consider the arguments about possible operational inconsistency between the Acts.
Operational inconsistency
If application is made to a Supreme Court, whether by appeal, or in reliance upon the power given by s 10 of the State Jurisdiction Acts to vary, revoke, set aside, or suspend the rights or liabilities declared by s 6, the rights and liabilities which are then established on appeal or under s 10 may differ from those which were created by the order of the Federal Court. Because the only rights and liabilities which an appeal or s 10 application may affect are those created by the State Jurisdiction Act, not those created by the Federal Court order, there is no direct interference with those latter rights. As the order of the Federal Court has effect until it is set aside, however, there is the potential for inconsistency between the two Acts so long as that Federal Court order remains in force[361].
[361]Victoria v The Commonwealth (1937) 58 CLR 618 at 631; Commonwealth v Western Australia (Mining Act Case) (1999) 196 CLR 392.
The application of the State Acts, including the provisions governing appeal and variation, depends upon the identification of a Federal Court judgment as an "ineffective judgment". That could be said to invite attention by a Supreme Court, in an appeal under s 7 or application under s 10, to whether the Federal Court judgment was legally ineffective (for want of jurisdiction in the Federal Court). This would require examination of the basis upon which the Federal Court acted in the particular matter. If that was required, a State Supreme Court would, by s 39(2) of the Judiciary Act, have invested federal jurisdiction to consider the questions of constitutional interpretation which such an inquiry would present.
Reading the definition of "ineffective judgment" in this way would, however, encounter some difficulties. First, for the reasons given earlier, the explicit or implicit conclusion of the Federal Court that it had jurisdiction in a matter would be binding on the parties to the matter until the order was set aside. That issue could not be re‑litigated in a State Supreme Court and the definition of "ineffective judgment" should not be read as requiring that to be done. Secondly, it is necessary to give full effect to the use in the definition of "ineffective judgment" of the words "purported" and "purporting" in the phrases "purported exercise of jurisdiction" and "purporting to have been conferred". The use of "purported" and "purporting" reveals that the validity of neither the exercise of jurisdiction, nor the conferral of jurisdiction, is a matter for inquiry in the Supreme Court. All that must be demonstrated is a historical fact: that there was an exercise of jurisdiction by the Federal Court which appears to have been founded in a relevant State Act.
If that historical fact exists, s 6 rights are created. Those rights will not clash with any which are recognised in, or derived from, a Federal Court judgment even if it turns out that the Court in fact had jurisdiction to decide the matter. If the Federal Court did have jurisdiction, the rights and duties of the parties would find their root in the order of that Court and the laws of the Parliament which permitted its making and the existence of any s 6 rights would be irrelevant. If, however, the Federal Court did not have jurisdiction, the rights and duties of the parties would find their root in the relevant State Act. Because the rights and duties are, for most practical purposes, the same, identifying their origin will very often be unnecessary. The basis of the parties' rights and duties becomes important only in the limited circumstances mentioned earlier: if there is a dispute about a party exercising ancillary rights or seeking to vary the rights and duties recognised in, or created by, the Federal Court order in question.
One example given in oral argument was of a Federal Court order providing that a company be wound up and a later order, made by a State Supreme Court pursuant to a State Jurisdiction Act, that the winding up be terminated. How would the tension between the two orders be resolved? On its face, the later order of the Supreme Court alters, impairs or detracts from the order of the Federal Court and it was submitted that the statutes which give force to those orders (a State Supreme Court Act and the Federal Court Act) would, to that extent, be inconsistent. As these reasons will seek to demonstrate this problem can be resolved, at a practical level, very easily.
The existence and extent of an inconsistency depends upon the particular Federal Court order and upon the nature of the change which is made on appeal or on application under s 10. Particular attention must be directed to the form and content of the Federal Court order. In cases such as the present, account must be taken of two features. First, a winding up order made under the Corporations Law is an order which the Corporations Law contemplates may be varied in certain respects. The liquidator named in the winding up order may be removed[362], released[363] or replaced[364]; the winding up may be stayed or terminated[365]. Ordinarily, it might have been expected that these steps would be solely in the power of the court which ordered the winding up. The Corporations Law provides, however, in s 58AA(1), that:
"'Court' means any of the following courts when exercising the jurisdiction of this jurisdiction:
(a) the Federal Court;
(b)the Supreme Court of this or any other jurisdiction;
…"
Accordingly, when provisions dealing with matters like removal or release of a liquidator, or stay or termination of the winding up, permit the "Court" to make such an order, it is clear that the Corporations Law contemplates that the order may be made by a court other than the court which ordered the winding up.
[362]Corporations Law, s 473(1).
[363]Corporations Law, s 480(c).
[364]Corporations Law, s 473(7).
[365]Corporations Law, s 482(1).
The winding up orders made by the Federal Court were made in purported exercise of jurisdiction conferred in respect of the Corporations Law of the State of incorporation of the company which was wound up. They were, therefore, orders which are to be understood as having been made subject to the various qualifications and limitations for which that Corporations Law provided. Those qualifications and limitations included not only matters such as the possible removal and replacement of the liquidator or termination of the winding up, but also, most importantly, the possibility that such orders may be made by a State Supreme Court. Orders of the latter kind would, therefore, not be inconsistent with the Federal Court order.
In the case of the funding orders, there are not the obvious express powers of modification of the order that are to be found in the Corporations Law in relation to winding up orders. Nevertheless, to the extent that a single judge of the Federal Court could modify the funding orders, we consider that those orders are to be understood as being subject to qualification or modification by orders made by a single judge of a Supreme Court in accordance with s 58AA.
It will be noted that we have referred to modification of the winding up orders or funding orders by a single judge. Different considerations arise in relation to appellate review of such orders. Section 58AA did not alter the ordinary course of appeals in the Federal Court and it follows that the Federal Court orders are not to be understood as contemplating appellate review otherwise than by the Full Court of the Federal Court.
The argument for inconsistency therefore remains. Its acceptance would not result, however, in the conclusion that the State Jurisdiction Acts are invalid (except, that is, to the extent of, and for the duration of, the inconsistency). If there were an inconsistency, it would prevent reliance upon s 6 rights unless and until the Federal Court order is quashed or set aside. Upon that order being quashed or set aside, the inconsistency would be removed and the s 6 rights could be exercised. If a party affected by a Federal Court order (who seeks to have the s 6 rights and duties varied, revoked or set aside) can readily have the Federal Court order quashed or set aside any question of inconsistency can be resolved. In effect, then, there would be no more than a temporary suspension of the relevant operation of the State Jurisdiction Act pending the quashing or setting aside of the Federal Court order.
Kable v Director of Public Prosecutions (NSW)[366]
[366](1996) 189 CLR 51.
The argument based on Kable's Case that ss 6 and 7 of the State Jurisdiction Acts are invalid because they make State Supreme Courts an inappropriate receptacle for federal jurisdiction may be dealt with shortly. The argument is one which assumed, wrongly, that the State Jurisdiction Acts created what the applicants called a "statutory judgment" of the State Supreme Court. It was contended that Supreme Courts thus became "an instrument of the legislature/executive" and that judicial orders were made by legislative decree and then passed off as valid judgments of the Supreme Courts.
These arguments misstate the effect of s 6 of the State Jurisdiction Acts. That section creates no judgment, whether of the Supreme Court or any other court. It creates rights and liabilities. There is no basis for concluding that the Acts infringe a principle to be derived from Kable's Case.
Relief
For the reasons given above, there is no direct or indirect inconsistency between the Federal Court Act and the State Jurisdiction Acts. The liquidator has rights and liabilities from the Federal Court orders and the State Acts which are for present purposes identical. There may be operational inconsistency if application is made to change the rights and liabilities which arise under s 6 of the State Jurisdiction Acts. There could be no operational inconsistency if the Federal Court orders were quashed.
In these circumstances, what relief should now be granted? We deal first with certiorari to quash and the application for extension of time.
In Re Wakim an application to extend the time for making application to quash a winding up order made by the Federal Court was refused. It was refused because it was not shown that third parties would not be affected adversely if the winding up order were quashed[367]. No such considerations arise in this case. If the orders of the Federal Court are quashed, the rights and liabilities of all persons will be determined by s 6 of the State Jurisdiction Acts.
[367]Re Wakim; Ex parte McNally (1999) 198 CLR 511 at 546 [25] per Gleeson CJ, 546 [26] per Gaudron J, 565 [81] per McHugh J, 592 [165] per Gummow and Hayne JJ, 635 [304] per Callinan J.
The orders of the Federal Court were made without jurisdiction and, as was said in R v Ross‑Jones; Ex parte Green[368]:
"If … a clear case of want or excess of jurisdiction has been made out, and the prosecutor is a party aggrieved, the writ [of prohibition] will issue almost as of right, although the court retains its discretion to refuse relief if in all the circumstances that seems the proper course."
That being so, in the circumstances of this case, we consider it better that a writ of certiorari issue to quash the orders. The application has been made, the orders were made without jurisdiction. If they are quashed there can be no remaining question of operational inconsistency.
[368](1984) 156 CLR 185 at 194 per Gibbs CJ.
Accordingly, we would extend the time for application for certiorari and grant an order absolute for certiorari to quash the winding up and funding orders. No question would then arise of directing prohibition to the Federal Court and, given that the liquidator may act upon his s 6 rights, there should be no prohibition directed to him.
In many cases it will be unnecessary for any party affected by an "ineffective judgment" of a single judge of the Federal Court to seek to have that order set aside or quashed for want of jurisdiction, whether by appeal to the Full Court of the Federal Court or by application for prohibition and certiorari in this Court. As a general rule it would seem very probable that there would be a need to seek such relief only to avoid an operational inconsistency. As has been explained earlier in these reasons, that would arise only if a party were to bring about, by appeal or s 10 application, some divergence between the s 6 rights and liabilities and rights and liabilities created by the Federal Court order. In such circumstances, if the order in question was made by a single judge of the Federal Court, appeal to the Full Court of that Court (and, if necessary, application for extension of time to appeal) would ordinarily be the more appropriate course.
Costs
Substantially the applicants have failed notwithstanding that certiorari should issue to quash the winding up and funding orders. That being so, the applicant or applicants in each matter should pay the costs of the liquidator and the added respondent, the Deputy Commissioner of Taxation.