Book forum on Shipra Chordia's Proportionality in Australian Constitutional Law: Murray Wesson

AUSPUBLAW is pleased to present another of our occasional series of book forums. In this book forum, Craig Lenehan SC and Murray Wesson reflect on Shipra Chordia's Proportionality in Australian Constitutional Law. Click here to read Craig’s post.

Murray Wesson

18.08.21

Proportionality is a vexed topic in Australian constitutional law. On the one hand, the High Court has for many years relied upon forms of proportionality to characterise laws enacted with respect to purposive and incidental law-making powers, and to determine the validity of laws burdening constitutional limits. On the other hand, the High Court’s application of structured proportionality to the implied freedom of political communication and more recently to the guarantee of free trade, commerce and intercourse among the states in s 92 of the Constitution has stirred controversy both on the Court and in academic commentary. There is a lack of clarity about the different forms of proportionality relied upon by the High Court and the contexts in which they should be applied.

Shipra Chordia’s book, Proportionality in Australian Constitutional Law, is an important contribution to these ongoing debates. The first part of the book explores the origins of proportionality, especially in German constitutional law. The discussion of German constitutional law allows Chordia to develop a theoretical framework for when the application of structured proportionality is appropriate – a point returned to below. Chordia also explores the relationship between structured proportionality and judicial restraint and evaluates alternatives to structured proportionality such as the system of tiered review relied upon in US constitutional law.

Thereafter, the book turns to the role of proportionality in Australian constitutional law. Chordia carefully distinguishes between different forms of proportionality, such as ‘smoking out’ a law’s purpose, means end analysis, and structured proportionality – although she expresses doubts about whether anything but the latter test should truly be regarded as proportionality. Chordia provides a detailed and compelling analysis of how these forms of proportionality should apply in different areas of Australian constitutional law. The analysis is informed both by a granular reading of the case-law and an overarching and well-developed theoretical framework. This blog post closely examines two aspects of Chordia’s argument.

Purposive and Subject Matter Heads of Power

First, in chapter 6 Chordia provides an interesting analysis of the role of proportionality in the characterisation of laws. There is a well-established distinction between the so-called ‘purposive’ heads of power, where proportionality plays a role in characterisation, and the ‘subject matter’ heads of power, where a ‘sufficient connection’ test is applied. The defence power (s 51(vi) of the Constitution) and the treaty implementation aspect of the external affairs power (s 51(xxix)) are both regarded as purposive powers. It is less clear if the express (s 51(xxxix)) and implied incidental power and the aliens power (s 51(xix)) are purposive.

Chordia argues that the correct form of proportionality to apply to the characterisation of laws enacted pursuant to purposive powers is as a ‘smoking out’ device. In terms of this approach, the Court inquires whether there is a relationship of proportionality between the purpose of the law and the means used to achieve that purpose. If there are other, less restrictive means of achieving the same purpose, ‘then there is a possibility that Parliament was seeking to pursue some illegitimate non-constitutional purpose’ (p 121). On the basis of her reading of German constitutional law, Chordia argues that proportionality involving balancing, or evaluation of the benefits of the law against the costs that it imposes, is inapposite in the context of that kind of characterisation. This is because there is not a conflict between two sets of rights or interests that have the same prima facie normative force. Instead, there is a conflict between a constitutional purpose and extra-constitutional rights and duties. The focus of the Court’s inquiry should therefore be solely on determining whether the law has a non-constitutional purpose.

Of particular interest in this chapter is Chordia’s analysis of why the defence power and treaty implementation aspect of the external affairs power are regarded as purposive. Chordia argues that this is not because they are inherently purposive but because they give rise to three distinct concerns: ‘(i) an undermining of the federal structure established by the Constitution; (ii) an incursion into the rights and interests of individuals; and (iii) a relinquishing to Parliament of the Court’s power to decide the limits of the scope of legislative power’ (p 113). Proportionality as a ‘smoking out’ device has emerged as a more searching standard of review than the sufficient connection test to contain the potential reach of these legislative powers.

It is difficult to read this analysis without reflecting on the corporations power (s 51(xx)). As far back as Huddart, Parker & Co Pty Ltd v Moorehead (1909) 8 CLR 330, Higgins J expressed concerns about the potentially deleterious effects of an expansive reading of the corporations power. Subsequent to the Work Choices case (2006) 229 CLR 1, Andrew Stewart and George Williams argued that federalism ‘lies in tatters’ and questioned ‘whether there are real limits left to the ability of the Commonwealth to regulate areas currently in State control’ (Work Choices: What the High Court Said, p 173). Nonetheless, in Work Choices the High Court expressly rejected a role for proportionality in the characterisation of laws enacted pursuant to the corporations power, finding that the necessity and desirability of legislative means are ‘matters of legislative choice’ (p 127).

In a footnote, Chordia recognises this difficulty but argues that, unlike the defence power and the treaty implementation aspect of the external affairs power, the corporations power is not ‘open-ended’ (p 112) because it is restricted to constitutional corporations. However, given how broadly constitutional corporations are defined by the High Court, and given how much economic activity in Australia is carried out through corporations, it is not clear that this restricts the corporations power any more than noting that the defence power is confined to defence or the treaty implementation aspect of the external affairs power is limited to treaties.

Possibly the corporations power should be regarded as purposive. Here a difficulty is that s 51(xx) of the Constitution gives a power to the Commonwealth Parliament to legislate with respect to constitutional corporations without identifying the purpose for which such legislation may be enacted. In other words, s 51(xx) does not seem amenable to the type of purposive analysis applied by the High Court to the defence power and treaty implementation aspect of the external affairs power. Chordia’s analysis illuminates but does not fully resolve the puzzle of the distinction drawn by the High Court between subject matter and purposive powers.

Freedom of Trade, Commerce and Intercourse

The second issue that requires closer consideration is Chordia’s thought-provoking analysis of the trade and commerce limb of s 92 of the Constitution. It is difficult to do justice both to the complexity of the case-law and Chordia’s rich discussion in a blog post. In essence, in Cole v Whitfield (1988) 165 CLR 360 the High Court held that the trade and commerce limb of s 92 protects against laws that impose discriminatory burdens ‘of a protectionist kind’ (p 394). The Court also held that laws that impose discriminatory burdens on interstate trade and commerce and have a protectionist effect may nonetheless be valid if they are necessary for the achievement of a non-protectionist purpose. The question is what form of proportionality is entailed by the Court’s reference to necessity.

Chordia argues that the appropriate test to apply to the trade and commerce limb of s 92 is also the ‘smoking out’ form of proportionality. In other words, the Court may consider whether there are less restrictive alternatives to the impugned law but solely with a view to determining whether the legislature is pursuing a protectionist purpose. Structured proportionality is inapposite in this context because the trade and commerce limb of s 92 does not involve a conflict between two sets of rights or interests that have the same prima facie normative force. The reference in Cole v Whitfield to discriminatory burdens ‘of a protectionist kind’ means that the ‘underlying balancing of the competing interests is baked into the definition itself’ (p 150). The High Court’s focus should be upon characterisation of the impugned law as opposed to the contextual balancing of interests entailed by structured proportionality.

Chordia’s analysis does not address the intercourse limb of s 92, noting that this is a ‘separate strand of doctrine…’ (p 131). As Gageler J notes in Palmer v Western Australia [2021] HCA 5, the intercourse limb differs from the trade and commerce limb in requiring that ‘interstate intercourse must be absolutely free from discriminatory burdens of any kind’ ([92]). On Chordia’s analysis, the intercourse limb of s 92 would seem to present a conflict between two sets of rights and interests that have the same prima facie normative force. The more open-ended reference to ‘discriminatory burdens of any kind’ would appear to mean that the balance of competing interests is not ‘baked into’ the definition itself, necessitating the application of structured proportionality.

This leads to the incongruous result that the more deferent ‘smoking out’ test is applied to the trade and commerce limb and the more searching structured proportionality test is applied to the intercourse limb of s 92. Of course, the same section of the Constitution is capable of supporting more than one standard of review. However, in the context of constitutional freedoms this type of bifurcated approach should ideally follow from an assessment of the normative value of the trade and commerce limb compared to the intercourse limb of s 92. In other words, an argument is required that from a normative perspective legislative intrusions upon free trade and commerce do not warrant the same level of judicial scrutiny as burdens upon intercourse among the states. In this regard, the joint judgment of Kiefel CJ and Keane J in Palmer represents a more coherent approach: s 92 should be understood in both aspects as a guarantee of ‘constitutionally protected freedoms’ ([59]). Similarly to the implied freedom of political communication, the application of structured proportionality to s 92 reflects the High Court’s role as the ‘guardian’ ([59]) of these freedoms.

It is also unclear why the reference to discriminatory burdens of a protectionist kind should preclude balancing analysis. By way of analogy, many constitutions prohibit discriminatory burdens of a racist kind by recognising race as a ground of discrimination. On occasion, legislation allowing for affirmative action may appear to produce prima facie breaches of these provisions. In these circumstances, it is not uncommon for courts to turn to balancing to determine whether the legislation is consistent with the constitutional equality guarantee. To give one example, in Minister of Finance v Van Heerden 2004 (6) SA 121 (CC) the South African Constitutional Court held that affirmative action should not impose such ‘substantial and undue harm on those excluded from its benefits that our long-term constitutional goal would be threatened’ ([44]). The reason why balancing is appropriate in these cases is that determining whether discriminatory burdens of a racist kind exist is a complex issue that is not reducible to determining whether legislation has a non-racist purpose. Instead, a multi-faceted inquiry is required that may involve contextual evaluation of competing interests. It is not clear why this is not also true of discriminatory burdens of a protectionist kind.

Conclusion

In Palmer a majority of the High Court found that structured proportionality should apply to both the trade and commerce limb and the intercourse limb of s 92. It is noteworthy that Chordia was cited in the judgments of Kiefel CJ and Keane J, Gordon J, and Edelman J. Proportionality in Australian Constitutional Law is a significant contribution to Australian constitutional law that will continue to inform developments at the highest level.

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Murray Wesson is a senior lecturer in the law school at the University of Western Australia.

Suggested citation: Murray Wesson, ‘Book Forum: Murray Wesson’ on AUSPUBLAW (18 August 2021) <https://auspublaw.org/blog/book-forum-murray-wesson/>