FEDERAL COURT OF AUSTRALIA Knight v Commonwealth of Australia [2016] FCA 1160 File number: ACD 109 of 2015 Judge: BROMBERG J Date of judgment: 15 September 2016 Catchwords: CONSTITUTIONAL LAW – Constitution, s 51(xxxi) – acquisition of property on just terms – where the applicant was denied payment under a reparation scheme established as an exercise of Commonwealth executive power – whether the constitutional guarantee of just terms for the acquisition of property under the Parliament's power to make laws pursuant to s 51(xxxi) extends to an exercise of executive power –no basis for concluding that the guarantee so extends – application dismissed Legislation: Constitution s 51(xxxi) Judiciary Act 1903 (Cth) s 39B(1A)(b) Cases cited: Attorney-General v Schmidt (1961) 105 CLR 361 Wurridjal v Commonwealth (2009) 237 CLR 309 Date of hearing: 15 September 2016 Registry: Victoria Division: General Division National Practice Area: Administrative and Constitutional Law and Human Rights Category: Catchwords Number of paragraphs: 17 Counsel for the Applicant: The Applicant appeared in person Counsel for the Respondent: Mr T Begbie Solicitor for the Respondent: Australian Government Solicitor ORDERS ACD 109 of 2015 BETWEEN: JULIAN KNIGHT Applicant AND: COMMONWEALTH OF AUSTRALIA Respondent JUDGE: BROMBERG J DATE OF ORDER: 15 SEPTEMBER 2016 THE COURT ORDERS THAT: 1. The originating application be dismissed. 2. The applicant pay the respondent's costs of the application. Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011. REASONS FOR JUDGMENT BROMBERG J: 1 This is a proceeding brought by the applicant ("Mr Knight") against the Commonwealth of Australia ("Commonwealth"). It concerns an application made by Mr Knight for a reparation payment under the Defence Abuse Repatriation Scheme made to the Defence Abuse Response Taskforce ("Taskforce"). 2 Mr Knight's application claims that the jurisdiction of the Court is enlivened by s 39B(1A)(b) of the Judiciary Act 1903 (Cth). Pursuant to that provision, the original jurisdiction of this Court includes jurisdiction in any matter arising under the Constitution or involving its interpretation. Mr Knight contended that the circumstances and events, which I will outline in a moment, involve the acquisition of property on other than just terms in breach of s 51(xxxi) of the Constitution. Relevantly, s 51(xxxi) provides: 51 The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: … (xxxi) the acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws; … 3 I shall return to consider that provision shortly. I should say at the outset that although a Notice of Competency contesting the Court's jurisdiction was filed at an early stage in the proceeding, it has not been pressed, and I need not deal with it. 4 I should at this point set out the relevant facts. Those facts are confined and not relevantly in dispute. Subject to several additions, they are sufficiently set out in the outline of submissions of the Commonwealth. 5 Mr Knight served in the Australian Regular Army from 12 January 1987 to 24 July 1987. He served as a junior staff cadet at the Royal Military College, Duntroon from 13 January 1987 to 10 July 1987. On 10 November 1988, Mr Knight was sentenced to life imprisonment and has been incarcerated since that time. 6 The Taskforce was established by the Australian Government as an exercise of Commonwealth executive power. The Taskforce operated pursuant to terms of reference and directions issued by Ministers responsible for the Taskforce, relevantly the Minister for Defence and the Minister for Justice. The Defence Abuse Reparation Scheme came into effect on 10 April 2013. The Taskforce administered the scheme pursuant to guidelines ("guidelines") issued by the Government in reliance upon its executive power. 7 In November 2013, Mr Knight applied to the Taskforce for a reparation payment and submitted an account of abuse said to have been suffered by him as an army cadet. Mr Knight alleges that he was physically injured on three occasions as a result of the direct action of various staff cadets. These occasions are alleged to have occurred in February 1987 and on 17 March 1987 at Duntroon, and on 31 May 1987 in a nightclub in Canberra. 8 At the time that Mr Knight's application was made, the guidelines contemplated that reparation payments for prisoners may be held in trust pending the release of the incarcerated applicant. Mr Knight's application for a reparation payment was assessed under the guidelines to be within scope and plausible for the purposes of reparation. However, in June 2015 the Ministers responsible for the Taskforce directed the Chair of the Taskforce not to make reparation payments to any complainant who was at that time incarcerated or on parole. As a result, Mr Knight's application for a reparation payment was not assessed and as a consequence the instant proceeding to this Court was initiated by Mr Knight on 4 September 2015. 9 On 3 February 2016, the Taskforce offered to reconsider Mr Knight's application for a reparation payment. However on 5 May 2016, the Ministers responsible for the Taskforce made a direction to the Taskforce that: (1) no reparation payment should be made to a person convicted of a serious crime; and (2) in determining what is a serious crime, the Taskforce should start from the proposition that an offence attracting a maximum sentence of over 10 years imprisonment is a serious crime. 10 On 8 June 2016, the Taskforce determined that Mr Knight had been convicted of a serious crime, and was therefore not eligible for a reparation payment. 11 Both parties accept that Mr Knight's application essentially raises only one question for determination by the Court. It has been referred to as a threshold question and I have received submissions in relation to that question and that question alone. The question is this: in determining that Mr Knight was ineligible for a reparation payment under the Defence Abuse Reparations Scheme, did the Commonwealth acquire Mr Knight's property other than on just terms contrary to s 51(xxxi) of the Constitution? It is accepted that the question arises in relation to a Commonwealth scheme established by executive action with no basis in statute or the general or common law. 12 The short answer to that question is really this: there has been no relevant exercise of legislative power by the Commonwealth and the requirement for just terms, which the authorities have often referred to as the "constitutional guarantee", simply does not arise. 13 It is plain on the opening words of s 51 of the Constitution that the provision is dealing with the power of the Commonwealth Parliament to make laws. It is in relation to that power to make laws, and in particular, in relation to the power to make laws for the acquisition of property provided by s 51(xxxi) that the constitutional guarantee applies. That proposition is so obvious that it is not surprising that there is no wealth of authority in support of it. One authority is sufficient. In Attorney-General v Schmidt (1961) 105 CLR 361 at 372, Dixon CJ (with whom Fullagar, Kitto, Taylor and Windeyer JJ agreed) said this: … It must be borne in mind that s. 51 (xxxi) confers a legislative power and it is that power only which is subject to the condition that the acquisitions provided for must be on just terms. … it is at least clear that before the restriction involved in the words "on just terms" applies, there must be a law with respect to the acquisition of property (of a State or person) for a purpose in respect of which the Parliament has power to make laws. The expression "for any purpose", is doubtless infinite. But it refers to the use or application of the property in or towards carrying out or furthering a purpose comprised in some other legislative power. 14 Those observations were referred to in Wurridjal v Commonwealth (2009) 237 CLR 309 at [75]. 15 There is, on the facts raised by this case, no relevant restriction applicable because there is no exercise of a legislative power involved whether under s 51(xxxi) or any other head of legislative power. 16 Mr Knight contended that the constitutional guarantee extended to executive action. He was unable to refer me to any authority in support of that proposition. Mr Knight relied on a number of authorities which, broadly speaking, stand for the proposition that a liberal approach is taken to the concept of "property" and to an "acquisition" within the meaning of s 51(xxxi) of the Constitution. But those authorities do not sustain the extension for which Mr Knight contends. In my view, the words of s 51(xxxi) are plain. I do not accept that the constitutional guarantee therein provided extends to executive action. Accordingly, Mr Knight's application should be dismissed. 17 I propose to make an order dismissing the application. I also propose to make an order that Mr Knight pay the Commonwealth's costs of the application. Unless there are special circumstances shown, the ordinary rule is that costs follow the event. Mr Knight contended that his application was made in good faith but, even if that was so, it would not constitute a special circumstance that would sustain an alteration to the ordinary rule. I certify that the preceding seventeen (17) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromberg. Associate: Dated: 26 September 2016