BY TRISTAN TAYLOR

Introduction

In 1996, the High Court struck down the validity of an ad hominem continuing detention legislative regime in the landmark case of Kable v Director of Public Prosecutions (1996) 189 CLR 51 (Kable). The principle established in that decision, has undergone significant development since. As it stands today, the principle will invalidate ‘State legislation which purports to confer upon a [Ch III court] a power or function which substantially impairs the court’s institutional integrity’: see Attorney-General (NT) v Emmerson (2014) 253 CLR 393 at [40] (French CJ, Hayne, Crennan, Kiefel, Bell and Keane JJ).

Although the core of the principle is now rather settled, its application is far from it. The High Court has itself expressed that it is not possible to state exhaustively what features of legislation may be regarded as impermissibly impairing a court’s institutional integrity: Forge v ASIC (2006) 228 CLR 45 at [64] (Gummow, Hayne and Crennan JJ). Instead, it is a matter of examining the substantive effect of the totality of the legislation in each particular case: Assistant Commissioner Condon v Pompano Pty Ltd (2013) 252 CLR 38 at [137] (Hayne, Crennan, Kiefel and Bell JJ). This precedential development of the doctrine reflects the High Court’s incremental and cautious application of the principle, having only invalidated legislation four times on this basis.

One ill-explored aspect of the Kable principle is the concept of ‘legislative directions’ — ‘Parliament cannot direct the courts as to the conclusions they should reach in the exercise of their jurisdiction’ (otherwise referred to as ‘the direction principle’): Australian Education Union v General Manager of Fair Work Australia (2012) 246 CLR 117 at [87] (Gummow, Hayne and Bell JJ). This concept, and its application at the state and territory level, recently arose for consideration by the Full Court of the Northern Territory Supreme Court in Parklands Darwin Pty Ltd v Minister for Infrastructure, Planning and Logistics [2021] NTSCFC 4 (Parklands Darwin).

Facts

In 2014, the plaintiff purchased Lots 6907 and 6908 Town of Darwin, which were zoned as ‘Community Purpose’ under the NT Planning Scheme. In 2017, the plaintiff requested that the defendant amend the Scheme to rezone the land from a Community Purpose zone to a ‘Specific Use’ zone pursuant to the Planning Act 1999 (NT) (the Act). This was to enable a seven storey block of residential units and shops (known as ‘Elysium’) to be built upon private land which had been dedicated for community purposes. A revised rezoning application was submitted by the plaintiff on 11 August 2019. However, the defendant refused the request.

Following this, the plaintiff commenced proceedings in the Supreme Court of the Northern Territory seeking an order of certiorari to quash the decision on a number of grounds, including inter alia that the defendant failed to comply with the requirements of the Act by not providing reasons for refusal as required by the Act, and that they failed to take into account mandatory relevant considerations in making their decision.

On 16 February 2021, the government introduced the Planning Amendment Bill 2021 (NT). The Bill received assent on 10 March 2021, and commenced the following day. Section 148A of the amended Act relevantly provides:

148A Validity of Decision
(1) This section applies in relation to the Minister’s decision to refuse a request to amend the NT Planning Scheme to change the zones of Lots 6907 and 6908 Town of Darwin, notice of which decision is dated 27 July 2020.
(2) Despite any law to the contrary, the decision is valid, and is taken to have been valid on and from the date it was made.

The defendant subsequently relied upon this provision in their Notice of Defence. In reply, the plaintiff pleaded s 148A’s invalidity. On 25 May 2021, the constitutional validity of this provision was referred for determination by the Full Court. Specifically, the Court was asked to determine whether section 148A:

(a) undermines or interferes with the institutional integrity of the courts of the Northern Territory; or
(b) otherwise infringes Chapter III of the Constitution?

In a unanimous judgment the Full Court (Grant CJ, Kelly J & Hiley AJ) answered the referred question with “no”. Applying a long line of High Court authority in both the Ch III (see, eg, Australian Education Union) and Kable contexts (see eg, Duncan v Independent Commission Against Corruption (2015) 256 CLR 83), the Court found that s 148A retrospectively validated the Minister’s decision which thereby affected the substantive rights of the parties in a permissible manner: see [29]. Section 148A was held not to be a legislative direction.

The Direction Principle at State and Territory Level

It is trite law that no strict separation of powers applies to state legislatures in relation to state courts: see, eg, South Australia v Totani (2010) 242 CLR 1 at [66] (French CJ). Consequently, ‘there can be no direct application to the States of all aspects of the doctrines that have been developed in relation to Ch III [of the Constitution]’: Kuczborski v Queensland (2014) 254 CLR 51 at [104] (Hayne J).

To recap, the direction principle is the principle that the legislature (or executive) cannot direct a court how to decide a particular case. On the other hand, a legislature is entitled to declare the substantive rights of parties, which may inevitably affect how a court determines a case. Due to the strict separation of powers that exists under the Commonwealth Constitution, legislative directions to courts are constitutionally invalid: see, eg, Chu Kheng Lim v Minister for Immigration, Local Government and Ethnic Affairs (1992) 176 CLR 1. However, there may be a question about the rigour with which the direction principle applies at the state and territory level. For a legislative direction to be constitutionally invalid at the state or territory level it must be tested against the Kable principle. In Gypsy Jokers Motorcycle Club Inc v Commissioner of Police (2008) 234 CLR 532, Gummow, Hayne, Heydon and Kiefel JJ expressed that,

[a]s a general proposition, it may be accepted that legislation which purport[s] to direct the courts as to the manner and outcome of the exercise of their jurisdiction would be apt impermissibly to impair the character of the courts as independent and impartial tribunals (at [39]).

Despite this strong suggestion, the limits of the direction principle at the state and territory level have not been conclusively determined for two reasons.

First, only one authority has found state legislation to have provided a legislative direction to a court: Building Construction Employees and Builders’ Labourers Foundation of New South Wales v Minister for Industrial Relations(1986) 7 NSWLR 372 (BLF NSW). In that case, the New South Wales Parliament enacted a provision which purported to ‘validate’ the decision of the state Minister to cancel the registration of a union. In its terms, the provision stated that the registration of the union ‘shall … be taken to have been cancelled … by operation of, and pursuant to, the Industrial Arbitration (Special Provisions) Act 1984’. This was held to be a direction towards courts to treat the registration as cancelled. However, because the decision was pre-Kable, it was held to be constitutionally valid as no strict separation of powers exists at the state level.

Secondly, following Kable, any case which has squarely confronted the question has held that the impugned legislation permissibly altered the substantive rights of the parties: see, eg, HA Bachrach Pty Ltd v Queensland (1998) 195 CLR 547 and Duncan v ICAC. Consequently, no High Court authority shows us when a legislative direction will be contrary to Kable.

The Full Court in Parklands Darwin purported to affirm the plurality’s position in Gypsy Jokers, stating (at [29]) that:

[I]t may be accepted that legislation which directs a court to reach a particular conclusion would ordinarily infringe Kable principles.

While Parklands Darwin does not provide a clear holding that a legislative direction which directs a court how to decide a particular case is invalid as against the Kable principle, this passage is noteworthy for further solidifying this view. It may provide succour for the view of many scholars that ‘the legislation in BLF [NSW] would almost certainly fail on Kable grounds’: see, eg, Professor Wheeler, ‘Due Process’ in Saunders and Stone (eds), The Oxford Handbook of the Australian Constitution at 948. However, while such a legislative direction may be contrary to the Kable principle, the circumstances in which a court will find a legislative direction of this nature appear to be growing slimmer as the jurisprudence grows. This is because of courts’ tendency to characterise legislation as falling on the ‘alteration of rights’ side of the distinction. If the mechanism of ‘alteration of rights’ is used, the time when this occurs (either before or after litigation commences) is irrelevant. This is because any direction is not specifically to the court about how to decide the particular case.

The Direction Principle ‘Diminished’

In Parklands Darwin, the plaintiff drew particular attention to the words ‘is taken to have been valid on and from the date it was made’ in s 148A: see [26]-[27]. It was submitted that these words were distinguishable from prior cases, such as the Australian Building Construction Employees’ and Builders Labourers’ Federation v Commonwealth (1986) 161 CLR 88, and that they were more akin to the language used in the BLF NSW case. The Full Court dismissed this submission. It is appropriate to set out the relevant parts of the passage (at [29]), which reflects the gravamen of the Full Court’s decision:

[O]n proper characterisation s 148A is not a direction to the Supreme Court as to how to determine the issues in this proceeding … Its effect, rather, is to validate retrospectively the Minister’s decision. That is to say, it is a retrospective validation of an administrative act which thereby affects substantive rights. It states expressly, and in the clear exercise of legislative rather than judicial authority, that ‘[d]espite any law to the contrary, the decision is valid’. The subsequent provision that the decision ‘is taken to have been valid on and from the date it was made’ is ancillary to that validation, and a direction to the Court only in the sense that it clarifies and puts beyond doubt that the legislative validation is retrospective in its operation.

While this could be seen as a simply orthodox application of past law, there are three noteworthy implications moving forward in the Kable context.

Ancillary Directions

As quoted above, the Full Court viewed the phrase ‘is taken to have been valid and from the date it was made’ as a permissible ‘ancillary direction’. In other words, it simply clarifies the original declaration of substantive rights by putting it ‘beyond doubt that the legislative validation is retrospective in its validation’ (at [29]). It does not direct the court as to how to exercise its jurisdiction.

This is significant because it puts substance ahead of form. It is well accepted that constitutional interpretation should not put form over substance: see Street v Queensland Bar Association (1989) 168 CLR 461. If the Court were to view the directive phraseology of ‘is taken to have been valid’ within s 148A as constituting a legislative direction, then it would let the form of the provision dictate the outcome. Professor Carney has critiqued the judgment of Street CJ in the BLF NSW case on this very basis: see ‘The Exercise of Judicial Power by State Parliaments’ (2017) 44 Australian Bar Review 204 at 219. This is justified: a simple change in legislative drafting should not be the difference between constitutional validity and invalidity: Ha v New South Wales (1997) 189 CLR 465 at 498 (Brennan CJ, McHugh, Gummow and Kirby JJ).

High Threshold

In a comprehensive article on this subject, Professor Gerangelos expressed that, following Nicholas v The Queen (1998) 193 CLR 173, the direction principle was ‘relevant only in egregious circumstances and that the threshold for its application is very high’: ‘The Separation of Powers and Legislative Interference with Judicial Functions in Pending Case‘ (2002) 30(1) Federal Law Review 1 at 31. Six years later, he suggested a reformulated direction principle which considered several indicia in determining whether legislation was a legislative direction or a substantive alteration of rights: ‘The Separation of Powers and Legislative Interference in Pending Cases’ (2008) 30(1) Sydney Law Review 61 at 92-4. Gerangelos’ approach aligns closely with that taken by the Privy Council in Liyanage v The Queen [1967] 1 AC 259.

The decision in Parklands Darwin is further confirmation that the threshold for the direction principle’s application is very high. To put this into perspective, s 148A of the Act had a number of indicia which are suggestive of a legislative direction under Gerangelos’ approach: it was retrospective; it was ad hominem and directed at specific proceedings; it determined proceedings; and part of the wording was directive. Further, the Court accepted that it was the ‘clear … objective intention’ of the provision to conclusively determine the dispute: see [8]-[9]. Despite all these indicia being present, it ‘[did] not mean that the Supreme Court has been unlawfully enlisted or conscripted to the purpose of the executive or legislature’ (at [30]). As a matter of substance, the legislative provision in Parklands Darwin altered substantive rights for all purposes: they did not direct the Court to change the rights of a party. The difficulty of the Gerangelos indicia is that they do not focus upon that central distinction. It is possible for legislation to fall on the ‘altering substantive rights’ side of the distinction even if all indicia are present.

Revisiting the BLF NSW case

Professor Wheeler, among others, has opined that ‘the legislation in BLF [NSW] would almost certainly fail on Kable grounds’. There are two ways to consider this statement.

On the one hand, if the legislation in the BLF NSW case was a legislative direction, then the outcome in Parklands Darwin further solidifies that it would be contrary to the Kable principle.

However, on the other hand, the result in Parklands Darwin begs the question as to whether the legislation in the BLF NSW case was in fact a legislative direction. Given the high threshold, it is arguable that the legislation would not be a legislative direction if decided today. It is quite possible to construe s 3(1) of the legislation in that case as substantively providing that the registration of the union was ‘cancelled … by operation of, and pursuant to, the Industrial Arbitration (Special Provisions) Act 1984’. The preceding phrase ‘be taken to have been’ could simply be viewed as an ancillary direction which clarifies the declaration of substantive rights. This interpretation of BLF NSW sits far more harmoniously with the High Court’s decision in Duncan v ICAC, where the impugned legislation was held not to be a direction. In that case, the main operative provision declared ICAC’s past conduct as valid by changing the meaning of ‘corrupt conduct’ and further provided that the ‘conduct [was] taken to have been, and always to have been, validly done’.

Conclusion

Australian jurisprudence will continue to wait for a case which strikes down state or territory legislation under the Kable principle for being an impermissible legislative direction. It is presently unclear whether special leave to appeal to the High Court will be sought or granted. However, if the approach of the Full Court of the Supreme Court of the NT in Parklands Darwin is anything to go by, the threshold for when legislation will amount to a legislative direction is set very high, and this outcome can be avoided by a proper legislative exercise of power to alter the substantive rights of parties. Consequently, the direction principle may have to wait some time before it is applied to invalidate legislation at the state or territory level.

Tristan Taylor works as a Research Associate to the Solicitor-General of Western Australia, and is a final year JD student at the University of Western Australia. The views expressed here are his own and not the views of the State of Western Australia.

Suggested citation: Tristan Taylor, ‘Parklands Darwin Pty Ltd v Minister for Infrastructure, Planning and Logistics [2021] NTSCFC 4: The “Direction Principle” Diminished?’ on AUSPUBLAW (1 September 2021) <https://auspublaw.org/2021/09/parklands-darwin-pty-ltd-v-minister-for-infrastructure-planning-and-logistics-2021-ntscfc-4-the-direction-principle-diminished/>