WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

FULL BENCH

CITATION : 2009 WAIRC 00668

DELIVERED : TUESDAY, 15 SEPTEMBER 2009

FILE NO. : FBA 4 OF 2009

Appellant

AND

Kimberley Land Council

Respondent

ON APPEAL FROM:

Jurisdiction : Western Australian Industrial Relations Commission

Coram : Commissioner S Wood

Citation : 2009 WAIRC 00443

File No : U 161 of 2008

CatchWords:

Industrial Law (WA) – Leave to appeal to the Full Bench – Consideration of public interest requirement and procedural nature of decision – Leave to appeal granted

Appeal against order of the Commission that the hearing of jurisdiction be reopened - Effect of the Workplace Relations Act 1996 (Cth) on the jurisdiction of the Commission in relation to 'constitutional corporations' – question of onus of proof on jurisdictional question – Question of jurisdiction does not depend on discharging onus of proof, it is a Statutory/Comstintutional Fact – Commission Erred – Additional submissions to be provided on appropriate orders

Legislation:

Industrial Relations Act 1979 (WA): s7, s23, s29(1)(b)(i), s34, s49(2a),

Workplace Relations Act 1996 (Cth): s3, s4(1), s5, s6, s7, s16

The Commonwealth Constitution: s109

Result:

Additional submissions to be provided

Representation:

Counsel:

Appellant : Mr S Millman (of Counsel)

Respondent : Mr D Schapper (of Counsel)

Solicitors:

Appellant : Slater & Gordon

Respondent : Derek Schapper, Barrister & Solicitor, Parry Street Chambers

Case(s) referred to in reasons:

A Raptis & Son v The State of South Australia (1977) 138 CLR 346

Aboriginal Legal Service of Western Australia (Inc  v Lawrence (2007) 166 IR 248

Aboriginal Legal Service of Western Australia (Inc) v Lawrence [No 2] (2008) 252 ALR 136

Attorney-General for the State of Queensland v Riordan (1997) 192 CLR 1

Australian Competition and Consumer Commission v Golden Sphere International Inc and Others (1998) 83 FCR 424

Bank of Queensland Ltd v Industrial Court of New South Wales [2008] FCA 324

Bray v F Hoffman-La Roche Ltd (2003) 200 ALR 607

Cigna Insurance Asia Pacific Ltd v Packer (2000) 23 WAR 159

Clarke v Stirling Skills Training Inc Trading as Jobwest (2002) 82 WAIG 621

Crown Scientific Pty Ltd v Clarke (2007) 87 WAIG 598

Currie v Dempsey [1967] 2 NSWR 532

Gerhardy v Brown (1985) 159 CLR 70

Johnston v Wesfarmers Ltd (1992) WAIRC, unreported No 900 of 1992, 31 December 1992

Levy v The State of Victoria (1997) 189 CLR 579

Mayne Industries Pty Ltd v Advanced Engineering Group Pty Ltd (2008) 166 FCR 312

Re Monger; Ex Parte Cross [2004] WASCA 176,

Murdoch University v The Liquor, Hospitality and Miscellaneous Union, Western Australian Branch (2005) 86 WAIG 247

New South Wales v The Commonwealth (2006) 229 CLR 1

The Owners of the Ship “Shin Kobe Maru” v Empire Shipping Company Inc (1994) 181 CLR 404

P v P (1994) 181 CLR 583

R v Blakeley; ex parte The Association of Architects Engineers Surveyors and Draughtsmen of Australia (1950) 82 CLR 54

R v The Judges of the Federal Court of Australia; ex parte The Western Australian National Football League (Inc) (1979) 143 CLR 190

Saldanha v Fujitsu Australia Pty Ltd (2008) 179 IR 259

Simjanovska v Roads and Traffic Authority of New South Wales (2008) 172 IR 420

Sportodds Systems Pty Ltd v New South Wales (2003) 202 ALR 98

Springdale Comfort Pty Ltd v Building Trades Association of Unions of Western Australia (Association of Workers) (1987) 67 WAIG 466

The State of South Australia v Tanner (1989) 166 CLR 161

Re State Public Services Federation; Ex parte Attorney Genera for the State of Western Australia(1993) 178 CLR 249

Tak Lau Kwa v City of Stirling [1999] WASCA 1025

Telstra Corporation Ltd v Worthing (1997) 150 ALR 217

Thomas v Mowbray (2007) 233 CLR 307

Tristar Steering and Suspension Ltd v Industrial Relations Commission of New South Wales (2007) 158 FCR 104

Re Will of Gilbert (1946) 46 SR (NSW) 318

Woods v Multi-Sport Holdings Pty Ltd (2002) 208 CLR 460

Case(s) also cited:

Autodesk Inc v Dyason (1993) 176 CLR 256

The Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union of Workers – Western Australian Branch v BHP Irone Ore Pty ltd [2001] WAIRC 2581

AFNEOKIU and the CEPU v BHP Billiton Iron Ore Pty Ltd The Australian Workers’ Union, Western Australian Branch, Industrial Union of Workers [2004] WAIRC 12462

Carter v The Egg and Egg Pulp Marketing Board for the State of Victoria (1942) 66 CLR 557

Civil Service Association of Western Australia v Shean (2005) 85 WAIG 2993

Dampier Salt (Operations) Pty Ltd v The Australian Workers’ Union, West Australian Branch, Industrial Union of Workers (1990) WAIRC, No 1359 of 1990, 11 April 1991

Edith Cowan University Student Guild v Gaunt (2004) 84 WAIG 459

Flaherty v Siemens Australia Ltd (1996) 76 WAIG 4429

Friessbourgv Valli (2008) 88 WAIG 10

Hanave Pty Ltd v LFOT Pty Ltd (2004) 136 FCR 566

House v The King (1936) 55 CLR 499

Maritime Workers Union of Western Australia, Industrial Union of Workers v Elder Prince Marine Service Pty Ltd (1983) 63 WAIG 2401

Peach v Sun Block Blinds (2006) 86 WAIG 2642

R v Heagney; Ex Parte ACT Employers (1976) 137 CLR 86

Robe River Iron Associates  v Amalgamated Metal Workers and Shipwrights Union of Western Australia (1989) 69 WAIG 1873

Smith v New South Wales Bar Assocaition (No 2) (1992) 176 CLR 256

Watson v Metropolitan (Perth) Passenger Transport Trust [1965] WAR 88

Reasons for Decision

RITTER AP:

Introduction

1          This is an application for leave to appeal and an appeal if leave is granted, against a decision made by the Commission on 9 July 2009.  For ease of reference I will refer to the applicant (and appellant if leave to appeal is granted) as Ms Guest and the respondent as the KLC. 

2          The decision sought to be appealed against was the making of an order that the “hearing of jurisdiction be reopened”. 

3          The decision is a “finding”, as defined in s7 of the Industrial Relations Act 1979 (WA) (the Act).  This is because the decision was “made in the course of proceedings” and did “not finally decide, determine or dispose of the matter”.  Accordingly, as provided in s49(2a) of the Act, an appeal “does not lie” to the Full Bench “unless, in the opinion of the Full Bench, the matter is of such importance that, in the public interest, an appeal should lie”.

4          Before considering whether this hurdle can be passed, it is necessary to set out the background to the making of the decision by the Commission. 

Background

5          It is common ground that Ms Guest was employed by the KLC as a solicitor until her employment was terminated on 27 October 2008.  On 21 November 2008 Ms Guest filed an application with the Commission alleging that the termination of her employment was “harsh, oppressive and unfair”.  Ms Guest sought by her application to be reinstated to her former position.  The KLC filed a notice of answer and counter proposal on 16 December 2008 (the answer).  In the answer, the KLC, for reasons it briefly particularised, rejected the allegation of unfair dismissal.  The answer also said that the KLC was a “constitutional corporation” pursuant to the then Workplace Relations Act 1996 (Cth) (the WRA).  The answer said that a significant and not insubstantial proportion of the total income of the KLC (at least 25% per annum) is derived from its trading activities.  The KLC therefore asserted “that the Commission is without jurisdiction to deal with this application and, consequently, denies the remedy being sought by” Ms Guest.  It is implicit that the KLC submitted the Commission had no jurisdiction because it was a trading corporation.  (As to this, see Aboriginal Legal Service of Western Australia (Inc) v Lawrence (2007) 166 IR 248; (2007) 87 WAIG 856 and Saldanha v Fujitsu Australia Pty Ltd (2008) 179 IR 259; (2008) 89 WAIG 76).

6          At a directions hearing on 30 January 2009 it was decided that there would be a preliminary hearing to determine the question of jurisdiction.  This then occurred on 16 and 27 February 2009. 

The Hearing as to Jurisdiction

7          It is clear that the preliminary hearing was conducted on the basis that the KLC had the onus of establishing that it was a constitutional corporation, (because it was a trading corporation), and therefore, due to the contents of the WRA and the application of s109 of the Constitution, the Commission did not have jurisdiction to hear and determine the application.  The KLC filed affidavits from witnesses giving evidence in support of the contention that it was a trading corporation.  It presented its case first at the jurisdictional hearing.  The KLC called witnesses who confirmed their affidavits, which were received as exhibits.  These witnesses were then cross-examined.  Mr Powrie, a witness who had not sworn or affirmed an affidavit, also gave evidence on behalf of the KLC. 

8          At the commencement of the second day of the hearing, the advocate for the KLC (not its present counsel) sought to “re-open the evidence” of Mr Powrie.  This was so that a relevant email which had been “discovered” by Mr Powrie could be put into evidence.  The application was granted to the extent of the email being received as an exhibit, without Mr Powrie being recalled. 

9          Ms Guest then gave her evidence.  In part it was constituted by an outline of evidence which was received as an exhibit.  Closing submissions were then made.  The advocate for the KLC made his submissions first.  Early on, he said that at that time the Commission was “purely to decide” whether the KLC “is a constitutional corporation or a trading corporation” (T101).  The use of the disjunctive “or” was clearly by way of particularisation rather than the expression of an alternative.  Counsel for Ms Guest submitted that the KLC, having raised the jurisdictional question, had the onus of proof in demonstrating that it was a constitutional corporation and therefore the Commission did not have jurisdiction (T106).  In his submissions in reply, the advocate for the KLC did not take issue with this submission.  The Commissioner reserved his decision.

The Reasons about Jurisdiction

10       Reasons for decision were published on 30 March 2009.  The Commissioner reviewed the evidence in some detail and considered the issue in accordance with the leading authority of the Industrial Appeal Court decision in Aboriginal Legal Service of Western Australia (Inc) v Lawrence [No 2] (2008) 252 ALR 136; [2008] WASCA 254.  The Commissioner also referred to areas where the evidence of the KLC may have been lacking but said that the “parties are responsible for their own cases” ([60]). 

11       The Commissioner concluded his reasons as follows:

“61 I conclude that I cannot, on the evidence before me, find that the [KLC] has earned $3.9 million (let alone $4.86 million) a year in activities which could be classed as trading activities.  In that sense the [KLC] has failed to discharge the onus upon them.  In light of this, and in conjunction with the comments I have made as to the purpose, structure and broader activities of the KLC, I therefore find that the Commission has jurisdiction to hear and determine the applicant’s claim.”

12       It is apparent that the jurisdictional question was determined upon the basis that the KLC had not discharged an onus of proving that it was a trading corporation. 

13       The Commissioner did not reduce his finding that the Commission had jurisdiction to a declaration or order.  Further, neither of the parties requested that he do so. 

The First “Appeal”

14       Nevertheless on 9 April 2009 the KLC filed an application for leave to appeal and an appeal if leave was granted against the “decision” made by the Commission.  One of the grounds of the proposed appeal sought to impugn the reasoning of the Commissioner that the onus was on the KLC to establish it was a trading corporation.  The application was listed for hearing on 16 June 2009.  At the commencement of the hearing the Full Bench pointed out that there were difficulties in proceeding with the application because there had been no award, order, or declaration made by the Commission under s34 of the Act.  The application was adjourned so that the KLC could consider its position.  Shortly afterwards the KLC discontinued its application/appeal to the Full Bench. 

The Application to Re-open the Jurisdictional Hearing

15       The Full Bench were informed by counsel for Ms Guest, without objection, that also on 16 June 2009, obviously after the hearing before the Full Bench, the KLC’s solicitor wrote to the associate to the Commissioner at first instance, seeking leave to re-open the question of jurisdiction.  Written submissions were consequently made by both parties on this issue.  The submissions of the KLC said that it sought to re-open its case for three purposes.  The first two were to adduce further evidence about the nature and extent of the services it provided and acquired.  Thirdly, the KLC sought to make submissions about the nature of the findings that the Commission must make in order to properly ground a finding of jurisdiction and the degree of satisfaction which must be achieved before findings may be made.  On this point the submissions elaborated that the Commission had to be persuaded by the evidence to the positive conclusion that the KLC was not a trading corporation before it could be satisfied that it had jurisdiction.

16       Ms Guest opposed the application to re-open.  Detailed written submissions were made upon the limited basis upon which leave to re-open should be granted, citing and quoting from relevant authorities.  The submissions did not deal with the substantive question of the onus of proof if leave to re-open was granted to argue that question. 

17       As I have already indicated the Commission allowed the application to re-open.  I have earlier quoted the order which was made.  Reasons for decision in support of the order were published on 8 July 2009. 

The Reasons about Re-opening

18       In his reasons the Commissioner set out the relevant background and summarised the submissions of the parties.  The Commissioner then cited, discussed and quoted from authorities about the circumstances in which the Commission should allow the re-opening of a hearing.  At [16] the Commissioner “restate[d]” that the hearing had “concerned the establishment of a jurisdictional fact; namely whether the KLC is a trading corporation”.  At [17] the Commissioner said that the evidence which the KLC sought to adduce with respect to the first two points mentioned earlier was reasonably available prior to the hearing.  The Commissioner then set out reasons in support of this statement and quoted from paragraphs [60] and [61] of his reasons published on 30 March 2009.  At [22] the Commissioner said that the KLC argued that he had taken the wrong course of action and that as the issue concerned a question of the powers of the Commission, he should have called for further evidence to ascertain precisely whether KLC is or is not a trading corporation.  The Commissioner referred to the submission of the KLC that it was not sufficient and wrong in law to say that the KLC had failed to prove that it is a trading corporation. 

19       The Commissioner then considered authorities on the onus of proof issue.  His Honour quoted from the unanimous reasons of the High Court in The Owners of the Ship “Shin Kobe Maru” v Empire Shipping Company Inc [1994] HCA 54; (1994) 181 CLR 404 at 426.  There the court said:

“Standard of proof and jurisdictional facts

...

Where jurisdiction depends on particular facts or a particular state of affairs, a challenge to jurisdiction can only be resisted by establishing the facts on which it depends.  And, of course, they must be established on the balance of probabilities in the light of all the evidence advanced in the proceedings held to determine whether there is jurisdiction.”

20       In the paragraph of the Commissioner’s reasons which followed, the Commissioner said that he was not persuaded that “somehow I erred through lack of findings, certainty or precision at [sic] first hearing such that the matter should be re opened”.  The Commissioner then went on to further consider the onus of proof issue.  The Commissioner said that the issue had not been determined by the Full Bench or the Industrial Appeal Court in the ALS case.  The Commissioner then referred to Attorney-General for the State of Queensland v Riordan and Others [1997] HCA 32; (1997) 192 CLR 1 in which the High Court considered the issue of the establishment of a jurisdictional fact of whether an “industrial dispute” existed.  The Commissioner quoted from the reasons of Toohey J at 24.  There, his Honour adhered to the view that he had expressed about the jurisdiction of the Australian Industrial Relations Commission in Re State Public Services Federation; Ex parte Attorney General for the State of Western Australia [1993] HCA 30; (1993) 178 CLR 249 at 288.  His Honour there said that it “is for the applicant who has invoked the jurisdiction of the Commission to make good the proposition that jurisdiction exists”.  His Honour went on to say that “there must be material before the Commission from which it can legitimately conclude that an industrial dispute (as defined) exists”. 

21       At [30] the Commissioner said that he took this “as a clear expression that the ‘onus’ rested with Ms Guest” to establish that the Commission had jurisdiction.  He then said that it would be difficult to come to a proper finding if an employer chose to simply assert a lack of jurisdiction without being prepared to then lead sufficient evidence.  The Commissioner said it was open to the Commission to “direct that such evidence be put by the employer”. 

22       The Commissioner then quoted from Springdale Comfort Pty Ltd v Building Trades Association of Unions of Western Australia (Association of Workers) (1987) 67 WAIG 466 at 467 where the Full Bench said it had been conceded in the proceedings that the onus of establishing that the Commission had jurisdiction rested with the party making the application. 

23       The Commissioner also quoted from the reasons of Beech SC (as the Chief Commissioner then was) in Clarke v Stirling Skills Training Inc Trading as Jobwest (2002) 82 WAIG 621 at 622 as follows:

“Firstly, it is Mr Clarke who is claiming that this Commission has the jurisdiction to deal with the claim that he has lodged in it.  Therefore, it is Mr Clarke who bears the onus of proving that the Commission has the jurisdiction to deal with the claim.  It is not for the respondent to the application to prove that the Commission does not have jurisdiction.  Rather, once the respondent has indicated a challenge to jurisdiction, and given the grounds for that challenge, the onus lies upon Mr Clarke to prove that the Commission does have jurisdiction.”

24       The Commissioner then said:

“33 I accept that I have applied the wrong test.  Whether my error in applying the wrong test as expressed in paragraph 61 of my Reasons would lead to a different result I do not know.  However, it clearly had an impact on my decision and hence justice requires and the administration of justice is best served by reopening the hearing.  Therefore I will issue an order to reopen the hearing and my Associate will contact the parties shortly to list a directions hearing.” 

25       With respect, the reasons of the Commissioner did not make it clear whether he was only permitting the re-opening of the hearing so that the parties could make submissions upon the decision to be made given the Commissioner’s acceptance that he had “applied the wrong test”, or whether he would go further and permit the parties and the KLC in particular to adduce additional evidence upon the issue of whether it was a trading corporation.  What the reasons do make clear however is that the decision to re-open the hearing turned upon the Commissioner’s view that he erred in deciding the jurisdictional question on the basis that the KLC must establish that it was a trading corporation.  Instead the Commissioner accepted that Ms Guest had to establish that the KLC was not a trading corporation.

Leave to Appeal

26       In a schedule to the notice of appeal Ms Guest set out the points upon which she relied to persuade the Full Bench that leave to appeal should be granted under s49(2a) of the Act.  These were that the proposed appeal would raise questions about the jurisdiction of the Commission in deciding an application to re-open a hearing and the question of which party bears the onus of proof when a “defence of ‘constitutional corporation’ is pleaded”.

27       I considered the criteria to be applied in considering whether an appeal should lie under s49(2a) of the Act in Murdoch University v The Liquor, Hospitality and Miscellaneous Union Western Australian Branch (2005) 86 WAIG 247 at [13]-[14].  (Gregor SC and Smith C agreed with my reasons).  As I there pointed out the public interest requirement in s49(2a) of the Act should not be narrowed to mean “special or extraordinary circumstances”.  Indeed a matter may be of public interest because of its general application and importance.  The Full Bench must exercise a value judgment dependant upon the issues which the proposed appeal will raise. 

28       In my opinion the present matter is of sufficient importance that it is in the public interest that an appeal should lie.  This is because the issue of the onus of proof when jurisdiction is challenged on the basis that an employer is a constitutional corporation is a matter of general importance.  It is an issue which is relevant to any application in which the question of jurisdiction is challenged on that basis.  Accordingly, it is of public benefit for the Full Bench to give its guidance to the Commission and future parties on this point. 

29       The KLC opposed leave to appeal being granted.  Counsel emphasised that the decision to re‑open involved the exercise of a discretion on a procedural point.  Counsel relied upon the decision of the Industrial Relations Commission of New South Wales in Simjanovska v Roads and Traffic Authority of New South Wales [2008] NSW IRComm 66; (2008) 172 IR 420.  At [31] of its reasons the Commission said that leave to appeal would rarely be granted if the discretionary decision appealed against was of a procedural nature.  Reliance was placed upon the reasons of Jordan CJ in Re Will of Gilbert (1946) 46 SR (NSW) 318 at 323.  There his Honour said that where a decision has involved an exercise of discretion on a point of practice or procedure “a tight rein” should be kept upon interference with orders made at first instance.

30       In this Commission, the “tight rein” is in part provided by the public interest requirement contained in s49(2a) of the Act.  As I have said, I am satisfied that this criteria has been met and therefore an appeal should lie.

31       In my opinion an order should be made giving leave to appeal. 

The Grounds of Appeal

32       In a schedule to the notice of appeal the following “grounds” were set out:

“On the Respondent’s Application dated 16 June 2009 to re-open the question of jurisdiction the Commission erred in:

1. finding that the question of jurisdiction should be re‑opened when there was no proper basis, in fact or law, to do so,

2. failing to properly apply the law to question of whether a party has a right to re-open its case.

On the substantive question of which party bears the onus of proof as to the employer’s status as a constitutional corporation, the Commission erred in:

1. failing to allow the parties a proper opportunity to make submissions

2. failing to consider the way in which the case was originally conducted before the commission

3. failing to apply the proper legal test

4. failing to provide proper reasons for decision” [sic – punctuation]

33       Of the points listed in support of the contention that the Commissioner erred on the onus of proof question, numbers one and four do not require any detailed consideration.  With respect to point one, Ms Guest’s complaint was that although the Commissioner permitted her to make submissions upon the issue of whether there should be a re-opening of the hearing on the basis of reconsidering the onus of proof issue, she did not get the opportunity to make submissions about who should bear the onus of proof.  It was accepted however that the latter deficiency was cured by the opportunity to argue the question before the Full Court.  Accordingly, it cannot provide a ground upon which to overturn the decision made by the Commission at first instance.

34       No submissions were made in support of point four.  That is probably a sufficient basis alone for the Full Bench not to be troubled by considering it.  In any event, in my opinion the Commissioner did provide adequate reasons for his decision, as I have set out earlier.  The Commissioner’s reasons made it plain that the basis upon which he was making his decision was his view that he had previously erred on the onus question.

Onus of Proof

35       At the hearing of the appeal, the major focus of the submissions made by counsel was upon the onus of proof question.  This was because both counsel recognised that, as I have just reiterated, this was the point on which the Commissioner’s decision turned. 

The Authorities Relied upon by Ms Guest

36       Ms Guest placed heavy reliance upon the observations of Walsh JA in Currie v Dempsey [1967] 2 NSWR 532 at 539 where his Honour said the following:

“In my opinion, the burden of proof [in the sense of establishing a case] lies on a plaintiff, if the fact alleged (whether affirmative or negative in form) is an essential element in his cause of action, eg if its existence is a condition precedent to his right to maintain the action.  The onus is on the defendant, if the allegation is not a denial of an essential ingredient in the cause of action, but is one which, if established, will constitute a good defence, that is, an ‘avoidance’ of the claim which, prima facie, the plaintiff has.”

37       Ms Guest submitted the application of these principles lead to the conclusion that the onus of proof on the jurisdictional question before the Commission lay upon the KLC.  That was because the issue of whether the KLC was a trading corporation did not involve a denial of an essential ingredient of the cause of action.  Ms Guest submitted it was an independent statutory defence.  It was submitted that the essential ingredients of a claim under s23 and s29(1)(b)(i) of the Act are that an applicant was an employee who had been employed by the respondent and who had been harshly, oppressively or unfairly dismissed from their employment.  It was submitted that the contention of the KLC, that the Commission did not have jurisdiction, did not cavil with these essential ingredients. 

38       A difficulty however in placing too much reliance upon Currie v Dempsey is that it was not a case where there was a challenge to the jurisdiction of, relevantly, the Metropolitan Licensing Court; let alone one based on s109 of the Constitution.  The issue was whether a club should be granted conditional registration under the Liquor Act 1912 (NSW).  The respondent did not submit the Court did not have jurisdiction to determine the claim but simply that registration should not be granted.  This was on the basis of an objection, provided for in the Liquor Act, that the club was “not required to meet a genuine and substantial need”. 

39       Ms Guest also relied upon a number of decisions which had applied Currie v Dempsey.  These were Tak Lau Kwa v City of Stirling [1999] WASCA 1025, Cigna Insurance Asia Pacific Ltd v Packer [2000] WASCA 415; (2000) 23 WAR 159, Re Monger; Ex Parte Cross [2004] WASCA 176, Australian Competition and Consumer Commission v Golden Sphere International Inc and Others [1998] FCA 598; (1998) 83 FCR 424 and Mayne Industries Pty Ltd v Advanced Engineering Group Pty Ltd [2008] FCA 27; (2008) 166 FCR 312.

40       Again however none of these cases involved a challenge to the jurisdiction of the Tribunal or Court to hear and determine the claim made or s109 of the Constitution.  In Tak Lau Kwa, the relevant issue was whether the applicant, in tortious claims, had the onus of proving that a City Council had acted unlawfully, in the sense of being without authority, in removing a sign.  In Cigna Insurance and also Re Monger, the issue was whether a claim was barred by the applicable statute of limitations.  The Supreme Court decided that a claim that an application was statute barred avoided the claim rather than responded to an essential element of it.  The issue was not whether the Court lacked the jurisdiction to hear the claim before it.  In Golden Sphere International the issue was the onus of proving loss suffered from a pyramid selling scheme.  The issue was not one of jurisdiction.  The same may be said of Mayne Industries, an intellectual property case, where it was said that the onus of proving infringing conduct was upon the applicant, as being an essential ingredient of the cause of action. 

41       Ms Guest also relied upon Johnston v Wesfarmers Ltd (1992) WAIRC, unreported No 900 of 1992, 31 December 1992.  There the respondent made a jurisdictional challenge to an application under s29(1)(b)(ii) of the Act on the ground that the claim was not an industrial matter because the affluxion of time had dissolved the employer-employee relationship.  In his reasons, Commissioner Salmon said he had considered all of the material and was “satisfied that the respondent has failed to make the case” (at 4).  It was submitted that this was consistent with the reasoning in Currie v Dempsey.  In my opinion this may be doubted given that the establishment of an employer-employee relationship was an essential ingredient to the applicant succeeding in his claim.  Accordingly, I do not propose to place reliance upon that decision.

The Authorities Relied upon by the Commissioner

42       As pointed out to the parties during the hearing of the appeal, the authorities relied upon by the Commissioner also did not consider the issue of a challenge to jurisdiction based upon the application of s109 of the Constitution.  Empire Shipping involved a claim under the Admiralty Act 1988 (Cth).  The respondent asserted that the claim did not satisfy the statutory criteria upon which a claim could be based (see 414).  No issue of s109 of the Constitution arose. 

43       In Riordan and also Re State Public Services Federation the issue discussed by Toohey J was whether the Australian Industrial Relations Commission had jurisdiction because an “industrial dispute” existed.  That was a jurisdictional fact; a fact which needed to be established before the Australian Commission had jurisdiction.  Section 109 of the Constitution did not arise and was not discussed in the reasons. 

44       The same may be said of the decisions of this Commission which the Commissioner relied on; Springdale Comfort and Clarke.  In Springdale Comfort there were claims for a site allowance and access to building sites for union officials.  It was argued that the Commission did not have jurisdiction because these did not constitute industrial matters (see 466).  In Clarke the applicant made claims of unfair dismissal and a denial of contractual benefits.  The respondent contended that the Commission did not have jurisdiction because the employee was subject to an award of the Australian Industrial Relations Commission.  There was no discussion of the question of onus of proof in the context of the application of s109 of the Constitution.

Section 109 of the Constitution

45       Section 109 of the Constitution provides:

“Inconsistency of laws

When a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid.”

46       As stated by four members of the High Court in P v P [1994] HCA 20; (1994) 181 CLR 583 at 601:

“Necessarily, the starting point for determining whether such inconsistency exists lies in an identification of the intended scope and operation of the Commonwealth law.”

47       Substantially the same point was made by Cole JA in Telstra Corporation Ltd v Worthing (1997) 150 ALR 217.  At 225 his Honour said:

“Once the scope of the Federal Act is determined, the question then arises whether the State Act purports to intrude into and qualify the operation of that federal [sic] Act.  If it does, s 109 strikes down the State Act but only to extent of that inconsistency.”

48       Beazley JA agreed with the reasons of Cole JA.  The decision of the New South Wales Court of Appeal was overturned by the High Court, but not on this point (see Telstra Corporation Ltd v Worthing [1999] HCA 12; (1999) 197 CLR 61).

49       The point was illustrated in Bank of Queensland Ltd v Industrial Court of New South Wales [2008] FCA 324.  There Greenwood J at [84] said the relevant parties were entitled to have the Court decide whether a particular agency agreement fell within the scope of the Independent Contractors Act 2006 (Cth) and whether an inconsistency with the Industrial Relations Act 1996 (NSW) arose.  That is, the scope of the Commonwealth Act needed to be first determined and then a decision made about whether the agency agreement was within that scope.

50       Whether a Commonwealth law applies depends upon the resolution of questions of law and sometimes questions of fact or mixed law and fact.  An example is A Raptis & Son v The State of South Australia (1977) 138 CLR 346.  There, the question of whether prawns caught by a fisherman were lawfully seized by South Australian authorities depended upon whether a Commonwealth or State law applied.  In turn this depended upon where the prawns were caught.  As stated by Gibbs J at 358-359.

“However, the question whether in the present case the three catches of prawns were lawfully seized depends on whether they were caught within the territorial waters of South Australia.  If they were, the Commonwealth Act does not apply and the prawns were taken in contravention of the State Act.  If they were not, the Commonwealth Act applies, the State Act is pro tanto inoperative, the prawns were not taken in contravention of its provisions and the seizure was unlawful.”  (See also Barwick CJ at 353 and Stephen J at 375). 

51       A majority of the Court decided that the prawns were not caught within the territorial waters of South Australia and accordingly their seizure was unlawful.  Relevantly for present purposes the question of inconsistency was determined by answering the questions of fact and law involved in deciding where the prawns were caught and whether that was within South Australian territorial waters.

The WRA and s109 of the Constitution

52       As I will try to explain, the question of whether the WRA through s109 of the Constitution applies to remove the jurisdiction of the Commission, depends upon whether the KLC is a trading corporation.

53       This question is one properly expressed in positive terms.  That is, relevantly, the WRA only applies to trading corporations and it is only if a respondent fits that description that the Commission will, consequently, via s109 of the Constitution, not have jurisdiction.

54       As submitted by counsel for the KLC, ordinarily deciding the question of whether a respondent is a trading corporation is the same thing as deciding if it is not.  It is only when, as here, a Commissioner is not sure of a corporation’s status after considering the evidence, that whether the question is expressed in positive or negative terms can have an impact.

55       Section 4(1) of the WRA sets out definitions of words and expressions “unless the contrary intention appears”. A “constitutional corporation” is defined in s4(1) of the WRA to mean a “corporation to which paragraph 51(xx) of the Constitution applies”. Section 4(1) of the WRA also provides that “‘employee’ has a meaning affected by section 5” and “‘employer’ has a meaning affected by section 6” (emphasis in original).

56       Section 51(xx) of the Constitution reads as follows:

“51 Legislative Powers of the Parliament

The Parliament shall, subject to this constitution, have power to makes laws for the peace, order, and good government of the Commonwealth with respect to: -

 …

(xx) Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth:”

57       Section 4(1) of the WRA also provides a definition of “State industrial authority” as follows:

“State industrial authority means:

(a) a board or court of conciliation or arbitration, or tribunal, body or persons, having authority under a State Act to exercise any power of conciliation or arbitration in relation to industrial disputes within the limits of the state; or

(b) a special board constituted under a State Act relating to factories; or

(c)  any other State board, court, tribunal, body or official prescribed for the purposes of this definition.”

58       There is also in s4(1) of the WRA a definition of “State or Territory industrial law” which relevantly includes:

“(a)  any of the following State Acts:

(i)  the Industrial Relations Act 1996 of New South Wales

(ii) the Industrial Relations Act 1999 of Queensland

(iii)  the Industrial Relations Act 1979 of Western Australia

(iv)             the Fair Work Act 1994 of South Australia

(v)               the Industrial Relations Act 1984 of Tasmania

…”

59       Section 5 of the WRA is as follows:

“5  Employee

     Basic definition

(1) In this Act, unless contrary intention appears:

employee means an individual so far as he or she is employed, or usually employed, as described in the definition of employer in subsection 6(1), by an employer, except on a vocational placement.

…

References to employee with ordinary meaning

(2) However, a reference to employee has its ordinary meaning (subject to subsection s(3) and (4)) if the reference is listed in clause 2 of Schedule 2. This does not limit the circumstances in which a contrary intention may appear for the purposes of subsection (1).

…

(3)  In this Act, unless the contrary intention appears, a reference to employee with its ordinary meaning includes a reference to an individual who is usually an employee with that meaning.

(4) In this Act, unless the contrary intention appears, a reference to employee with its ordinary meaning does not include a reference to an individual on a vocational placement.”

60       Section 6 of the WRA is relevantly as follows:

“6 Employer

     Basic definition

(1) In this Act, unless the contrary intention appears:

     employer means:

(a) a constitutional corporation, so far as it employs, or usually employs, an individual

…

References to employer with ordinary meaning

(2) However, a reference to employer has its ordinary meaning (subject to subsection (3)) if the reference is listed in clause 3 of Schedule 2. This does not limit the circumstances in which a contrary intention may appear for the purposes of subsection (1).

(3) In this Act, unless the contrary intention appears, a reference to employer with its ordinary meaning includes a reference to a person or entity that is usually an employer with that meaning.”

61       Section 7 of the WRA defines ‘employment’ in the following way:

  “7 Employment

(1) In this Act, unless the contrary intention appears:

employment means the employment of an employee by an employer.

...

References to employment with ordinary meaning

(2) However, a reference to employment as its ordinary meaning if the reference is listed in clause 4 of Schedule 2. This does not limit the circumstances in which a contrary intention may appear for the purposes of subsection (1).

…”

62       Section 16 of the WRA provides as follows:

“16 Act excludes some State and Territory laws

(1) This Act is intended to apply to the exclusion of all the following laws of a State or Territory so far as they would otherwise apply in relation to an employee or employer:

(a) a State or Territory industrial law;

(b) a law that applies to employment generally and deals with leave other than long service leave;

(c) a law providing for a court or tribunal constituted by a law of the State or Territory to make an order in relation to equal remuneration for work of equal value (as defined in section 623);

(d) a law providing for the variation or setting aside of rights and obligations arising under a contract of employment, or another arrangement for employment, that a court or tribunal finds is unfair;

(e)  a law that entitles a representative of a trade union to enter premises.

…

State and Territory laws that are not excluded

(2)  However, subsection (1) does not apply to a law of a State or Territory so far as:

(a) the law deals with the prevention of discrimination, the promotion of EEO or both, and is neither a State or Territory industrial law nor contained in such a law; or

(b) the law is prescribed by the regulation as a law to which subsection (1) does not apply; or

(c) the law deals with any of the matters (the non-excluded matters) described in subsection (3).

    (3) The non-excluded matters are as follows:

     (a) superannuation;

     (b) workers compensation;

(c) occupational health and safety (including entry of a representative of a trade union to premises for a purpose connected with occupational health and safety);

(d)  matters relating to outworkers (including entry of a representative of a trade union to premises for a purpose connected with outworkers);

(e) child labour;

(f) long service leave;

(g) the observance of a public holiday, except the rate of payment of an employee for the public holiday;

(h)  the method of payment of wages or salaries;

(i) the frequency of payment of wages or salaries;

(j) deductions from wages or salaries;

(k) industrial action (within the ordinary meaning of the expression) affecting essential services;

(l)  attendance for service on a jury;

(m) regulation of any of the following:

(i) associations of employees;

(ii) associations of employers;

(iii) members of associations of employees or of associations of employers.

…

This Act excludes prescribed State and Territory laws

(4) This Act is intended to apply to the exclusion of a law of a State or Territory that is prescribed by the regulations for the purposes of this subsection.

(5) To avoid doubt, subsection (4) has effect even is the law is covered by subsection (2) (so that subsection (1) does not apply to the law). This subsection does not limit subsection (4).

Definition

(6) In this section:

this Act includes the Registration and Accountability of Organisations Schedule and regulations made under it.’”

63       In New South Wales v The Commonwealth [2006] HCA 52; (2006) 229 CLR 1, a majority of the High Court decided that these sections of the WRA were constitutionally valid.  In doing so the majority considered, to some extent, the scope and operation of these sections.  This was considered more specifically by the Full Federal Court in Tristar Steering and Suspension Ltd v Industrial Relations Commission of New South Wales (2007) 158 FCR 104.  The context was whether there was an inconsistency between the WRA and the Industrial Relations Act 1996 (NSW), such that the latter did not apply to constitutional corporations.  The members of the Full Court wrote separate reasons, although Gyles J at [18] also said that he agreed with the substance of the reasons of each of Kiefel and Buchanan JJ. 

64       Kiefel J at [15]-[16] said:

“[15] It is the Commonwealth Act to which regard must be had in determining inconsistency.  …  That is so here whether the subject is described by reference to the relations between employer and employee as defined or the rights and obligations which may be made the subject of specific rule.  Section 16 discloses a clear intention to exclude that area of relations from State law, at least so far as concerns employers which are constitutional corporations.

[16] …  The State Act intrudes into the field reserved by s 16 by its provisions which concern the relationship between employers and employees, where the former are constitutional corporations. …”

65       Gyles J at [22] said:

“[22] Whilst the NSW Act may not be wholly invalid, it can have no effect upon constitutional corporations concerning their relations with actual or potential employees.”

66       Buchanan J at [39] said the first inquiry to be made was that of the field occupied by the WRA.  His Honour then said at [45] and [47]:

“[45] By its terms s 16 of the WR Act declares an intent that the WR Act occupy, to the exclusion of the IR Act, (subject only to the exceptions in s 16(2), (3) and (4) — which are not here relevant), the whole field of legislative activity ‘in relation to an employee or employer’ (my emphasis) where the employer is an entity identified by s 6(1) of the WR Act, including a constitutional corporation.

…

[47] …  The IR Act is rendered invalid to the extent that it ‘would otherwise apply in relation to’ constitutional corporations who are employers or any of their employees.”

67       These observations by their Honours support the conclusion that it is the answer to the question of whether a respondent is a constitutional corporation, as opposed to whether it is not, which determines whether the Commission has jurisdiction.  That is because it is only in the former situation that the WRA applies. 

68       In my opinion this conclusion is also supported by the reasons of Steytler P (with whom Pullin J agreed) in ALS at [14], where his Honour said:

“14 The parties agree that, because the Commonwealth Act applies to industrial matters as between constitutional corporations and their employees to the exclusion of the State Act (so far as the State Act would otherwise apply in relation to an employee or employer), the effect of s 109 of the Constitution is that, so far as the State Act purports to give to the Commission jurisdiction to deal with industrial matters concerning relations between a constitutional corporation and its employees, or one of them, it is invalid.  That, in turn, means that, if the Full Bench was wrong to find that the appellant was not a trading corporation, then its decision that the Commission had jurisdiction to embark upon the appellant's claim was also wrong 'in that the matter the subject of the decision is not on an industrial matter'.  This would be so because the word 'employer(s)' in s 7(1) does not extend to a constitutional corporation and the word 'employee(s)' does not extend to a person employed by a constitutional corporation.”

69       In my opinion it is the last sentence quoted from his Honour’s reasons which is telling.  The effect of what his Honour says is that if an employer is a constitutional corporation then the Commission does not have jurisdiction.  This point is not, in my opinion, undermined by his Honour’s earlier reference in that paragraph to the issue of whether the Full Bench was wrong to find that the ALS was not a trading corporation.  In my opinion that reference related to the specific decision there made by the Full Bench; dismissing the appeal on the basis that it agreed with the Commissioner at first instance that the ALS was not a trading corporation.  The same may be said of his Honour’s similar expression at [11] and conclusion at [74].

Did the Commissioner Err?

70       To summarise therefore, the question of jurisdiction turned upon whether the KLC was a trading corporation.  If so, then the WRA applied and there was an inconsistency with the Act such that the Commission does not have jurisdiction to hear and determine the claim of Ms Guest. 

71       It follows that the Commissioner was in error when he reasoned that the jurisdictional question turned upon whether Ms Guest could establish that the KLC was not a trading corporation.  Indeed, as I will later elaborate, the use of the word “onus” is somewhat misplaced.  The issue did not so much involve an onus, but determination of whether the KLC was, as a matter of fact, a trading corporation.  If it was, then as I have said, the Commission does not have jurisdiction.  (As to the question being one of fact, see R v The Judges of the Federal Court of Australia; ex parte The Western Australian National Football League (Inc) (1979) 143 CLR 190 at 234 and ALS per Steytler P at [68]). 

72       As I have said the decision of the Commissioner to re-open the jurisdictional question turned upon his view about the onus of proof.  Accordingly, that decision was infected with the error he made. 

Disposition

73       That does not necessarily mean however that the decision to re-open the jurisdictional question was wrongly made.  The decision would not have been wrongly made if there was a good reason to re-open the jurisdictional question irrespective of the Commissioner’s erroneous opinion as to the onus of proof.

74       As I set out earlier, the decision of the Commissioner that the KLC was not a trading corporation was made on the basis that it had not discharged its onus of proof in establishing that it was not.  In my opinion this also involved an erroneous approach.  This was because the question of jurisdiction did not depend upon whether the KLC could discharge an onus but whether as a matter of fact the KLC was a trading corporation.  In my opinion this issue should not have been decided on the basis of uncertainty occasioned by a lack of evidence on issues upon which additional evidence could be fairly readily adduced.  This was so, for example, with respect to the amount of income generated by the KLC in engaging in work clearance programs for mining companies.  This issue is referred to in the Commissioner’s first reasons.  It was relevant to the Commissioner determining the nature and extent of the trading activities of the KLC.

Constitutional Facts

75       In my opinion the observations of Brennan J in Gerhardy v Brown (1985) [1985] HCA 11; 159 CLR 70 at 141-142 are applicable.  His Honour said:

“There is a distinction between a judicial finding of a fact in issue between parties upon which a law operates to establish or deny a right or liability and a judicial determination of the validity or scope of a law when its validity or scope turns on a matter of fact.  When a court, in ascertaining the validity or scope of a law, considers matters of fact, it is not bound to reach its decision in the same way as it does when it tries an issue of fact between the parties.  The validity and scope of a law cannot be made to depend on the course of private litigation.  The legislative will is not surrendered into the hands of the litigants.  When the validity of a State law is attacked under s 109 of the Constitution and the scope of the Commonwealth law with which it is thought to be inconsistent depends on matters of fact (which I shall call the statutory facts) the function of a court is analogous to its function in determining the constitutional validity of a law whose validity depends on matters of fact.  In Breen v. Sneddon ((1961) 106 CLR 406 at 411), Dixon CJ said, pointing to the distinction between constitutional facts and facts in issue between the parties-

‘It is the distinction between, on the one hand, ordinary questions of fact which arise between the parties because one asserts and the other denies that events have occurred bringing one of them within some criterion of liability or excuse set up by the law and, on the other hand, matters of fact upon which under our peculiar federal system the constitutional validity of some general law may depend.  Matters of the latter description cannot and do not form issues between parties to be tried like the formal questions.  They simply involve information which the Court should have in order to judge properly of the validity of this or that statute or of this or that application by the Executive Government of State or Commonwealth of some power or authority it asserts.’

Earlier, in Commonwealth Freighters Pty. Ltd. v. Sneddon ((1959) 102 CLR 280 at 292), his Honour had observed that “if a criterion of constitutional validity consists in matter of fact, the fact must be ascertained by the court as best it can, when the court is called upon to pronounce upon validity”.  The court may, of course, invite and receive assistance from the parties to ascertain the statutory facts, but it is free also to inform itself from other sources.”  (See also Gibbs J at 87-88).

76       In my opinion the observations by Brennan J are particularly apposite given the reference to s109 of the Constitution and the scope of a Commonwealth law depending upon matters of fact.  So too are his Honour’s observations about the scope of a law not being dependent upon “the course of private litigation” and that the court may “receive assistance from the parties to ascertain the statutory facts”.

77       Brennan J referred to his reasons in Gerhardy and made some additional observations in The State of South Australia v Tanner [1989] HCA 3; (1989) 166 CLR 161 at 179.  Relevantly his Honour said:-

“In this country, when the validity of a law depends on some matter of fact, the fact is not ascertained as though it were a mere issue between the parties … validity is a question of law and questions of law do not depend upon a party’s discharge of an onus of proof of facts … to the extent that validity depends on some matter of fact, there is no onus on a challenging party which, being undischarged, will necessarily result in a declaration of validity.”

78       This is relevant as the validity of the Act, insofar as whether it operated to apply to the KLC, depended in turn upon whether as a matter of fact it was a trading corporation.

79       Brennan J reiterated the points which he had made in Levy v The State of Victoria [1997] HCA 31; (1997) 189 CLR 579 at 598-599.  They were applied by McHugh J in Woods v Multi-Sport Holdings Pty Ltd [2002] HCA 9; (2002) 208 CLR 460 at [65] and discussed by Callinan J at [164] of the same case, and Heydon J in Thomas v Mowbray [2007] HCA 33; (2007) 233 CLR 307 at [634]ff.

80       In Sportodds Systems Pty Ltd v New South Wales (2003) 202 ALR 98 at [47]-[49] the Full Federal Court quoted from and applied the reasoning of Brennan J in Gerhardy.  The court also observed at [48] that to decide constitutional facts “the court could require the parties to provide further factual material”.  As set out earlier this was recognised by the Commissioner but not acted upon.

81       Counsel for the KLC submitted that before proceeding to hear and determine Ms Guest’s application, the Commissioner had to be positively satisfied that he had jurisdiction to do so.  It was submitted that this state of satisfaction could not be achieved by uncertainty as to whether the KLC was a trading corporation based upon an insufficiency of evidence.  These submissions are supported by the principle that it is the first duty of a statutory court or tribunal to decide whether it has jurisdiction.  (See R v Blakeley; ex parte The Association of Architects Engineers Surveyors and Draughtsmen of Australia (1950) 82 CLR 54 at 70; Crown Scientific Pty Ltd v Clarke (2007) 87 WAIG 598 at [96] and Bray v F Hoffman-La Roche Ltd (2003) 200 ALR 607 at [239]).

82       It follows from the above analysis that the reasoning of the Commissioner in support of the conclusion that the KLC was not a trading corporation was problematic in that:

(a) The Commissioner wrongly asserted there was an onus of proof on the KLC.

(b) The issue of onus of proof did not properly arise.

(c) The determination of the question of whether the KLC was a trading corporation should have been determined as a constitutional or statutory fact in the way described by Brennan J in Gerhardy.

(d) The Commissioner did not consider whether to invite or require the parties to adduce additional evidence on the basis of and in accordance with the principles set out by Brennan J in Gerhardy and the other cases I have referred to.

(e) The Commissioner did not decide that the Commission had jurisdiction on the basis of a positive satisfaction that it did so but because of an uncertainty or insufficiency as to the evidence and an erroneous application of an onus of proof.

83       The fact that the jurisdictional hearing proceeded on the basis that the KLC had an onus was heavily relied upon by Ms Guest to support the correctness of the first decision by the Commissioner.  However the manner of the hearing and/or the assumptions of the parties could not alter the legal position about the way in which the Commissioner was required to determine whether the KLC was a trading corporation.

Additional Submissions

84       The above points provide reasons why the jurisdictional question should be re-opened.  It is fair to say however that these points were not the subject of submissions by counsel during the hearing of the appeal.  Accordingly, in my opinion it is appropriate to receive additional written submissions from the parties upon the appropriate course to take and orders to be made having regard to these reasons.  At this stage my preliminary view is that the only orders which should be made are that leave to appeal is granted and the appeal is dismissed. This is because although Ms Guest has established that the Commissioner did err in his consideration of the onus of proof issue, this does not mean that the jurisdictional question should not have been reopened for the reasons I have outlined. If the appeal is dismissed then the matter will remain with or be returned to the Commissioner who can then act in accordance with the order which was appealed against. The timing of the provision of the submissions and any orders to be made for that purpose can be resolved administratively.

SCOTT C:

85      I have had the benefit of reading the draft Reasons for Decision of the Acting President and agree with them.

MAYMAN C:

86      I have had the benefit of reading the reasons for decision of his Honour, the Acting President.  I agree with those reasons and have nothing further to add.