High Court of Australia Judgment Summary Notes

State of NSW v Kable [2013] HCA 26

Today the High Court unanimously allowed an appeal by the State of New South Wales and held that a detention order made by a judge of the Supreme Court of New South Wales under legislation later held to be unconstitutional was a defence to a claim for false imprisonment.  The order was held to be valid until it was set aside.

Mr Gregory Wayne Kable was detained in custody for six months in 1995 pursuant to an order of the Supreme Court made under s 9 of the Community Protection Act 1994 (NSW) (“the Community Protection Act”).  Mr Kable unsuccessfully appealed against the detention order to the Court of Appeal.  After Mr Kable was released from detention, he successfully appealed to the High Court.  The High Court ordered that the detention order be set aside on the basis that the Community Protection Act was unconstitutional and was therefore invalid.

Following the decision of the High Court setting aside the detention order, Mr Kable commenced proceedings in the Supreme Court, ultimately claiming damages against the State for abuse of process, false imprisonment and malicious prosecution.  A number of preliminary questions were decided by the primary judge against Mr Kable and judgment was entered for the State.  Mr Kable appealed to the Court of Appeal.  That Court allowed the appeal in part, holding that Mr Kable should have judgment against the State for damages to be assessed on his claim for false imprisonment.

By special leave, the State appealed to the High Court.  The Court unanimously allowed the appeal, and held that the detention order was valid until set aside.  It had therefore provided lawful authority for Mr Kable’s detention.  The primary judge’s orders dismissing Mr Kable’s claims were reinstated.

Kakavas v Crown Melbourne Limited [2013] HCA 25

Today the High Court unanimously dismissed an appeal from a decision of the Court of Appeal of the Supreme Court of Victoria, which held that Crown Melbourne Limited (“Crown”) did not act unconscionably in allowing the appellant to gamble and lose large sums of money at its casino. 

The appellant was a high-stakes gambler and regular patron of Crown’s casino.  Between June 2005 and August 2006, he turned over $1.479 billion playing baccarat at the casino.  He brought a claim to recover his net loss of $20.5 million over that period. 

The appellant issued proceedings against Crown and two of its employees in the Supreme Court of Victoria, claiming that they had engaged in unconscionable conduct contrary to s 51AA of the Trade Practices Act 1974 (Cth) and under the general law.  At trial, the appellant alleged that Crown had lured him, a known problem gambler, to gamble at its casino by providing incentives, such as rebates on losses and the use of Crown’s private jet.  In dismissing the appellant’s claims, the primary judge held that the appellant’s gambling problem was not a kind of special disadvantage that rendered him susceptible to exploitation.  Further, Crown had not sought to exploit, nor was there any scheme to exploit, any disadvantage from which the appellant might suffer. 

On appeal, the Court of Appeal held that the appellant had failed to demonstrate that the primary judge’s conclusion, that he was not in a position of special disadvantage, was erroneous, or that the wagering transactions that he engaged in with Crown were unfair, unjust or unreasonable.  The Court of Appeal upheld the primary judge’s finding that Crown was entitled to accept the appellant as he presented himself to it:  a successful businessman entirely capable of making decisions in his own interests.  The appellant appealed by special leave to the High Court.

In the High Court, the appellant did not seek to challenge any findings of fact made by the primary judge.  His argument shifted emphasis to a claim that Crown, by allowing him to gamble at its casino, had exploited his inability, by reason of his pathological urge to gamble, to make worthwhile decisions in his own interests while actually engaged in gambling.  The High Court dismissed the appeal and concluded that the appellant’s attempt to invoke principles of unconscionability failed.  The Court did not accept that the appellant’s pathological interest in gambling was a special disadvantage which made him susceptible to exploitation by Crown.  He was able to make rational decisions in his own interests, including deciding from time to time to refrain from gambling altogether.  Crown did not knowingly victimise the appellant by allowing him to gamble at its casino.

 Plaintiff M79-2012 v Minister for Immigration and Citizenship [2013] HCA 24

Today a majority of the High Court held that the decision of the Minister for Immigration and Citizenship (“the Minister”) to grant the plaintiff a temporary safe haven visa was valid and that the plaintiff’s application for a protection visa was not valid. 

The plaintiff arrived at Christmas Island in February 2010 without a visa to enter or remain in Australia, and was placed in immigration detention.  Because Christmas Island is an excised offshore place under the Migration Act 1958 (Cth) (“the Act”), the plaintiff was prevented from making a valid application for a protection visa by s 46A(1) of the Act. 

The Minister has a power under s 195A of the Act to grant a visa of a particular class to a person in immigration detention if the Minister thinks that it is in the public interest to do so, without regard to any criteria for that visa contained in the Migration Regulations 1994 (Cth) and certain specified provisions of the Act.  In the exercise of that power, the Minister granted each of the plaintiff and 2,382 other people in like circumstances two visas: a temporary safe haven visa, permitting a stay of seven days, and a bridging visa, permitting a stay of between three and 12 months (six months in the plaintiff’s case). 

On the plaintiff’s release from detention, s 46A(1) of the Act no longer applied to prevent the making of a valid protection visa application.  However, the grant of a temporary safe haven visa engaged a similar statutory bar, imposed by s 91K of the Act.  The Minister stated that, had it not been possible to grant the temporary safe haven visa simultaneously with the grant of the bridging visa, the Minister would not have exercised his power to grant the bridging visa.  This was because, the plaintiff having been released from immigration detention, the grant of the bridging visa alone would have enabled the plaintiff to lodge a valid application for a protection visa in circumstances where the protection claim was already being dealt with under existing alternative processes. 

The plaintiff applied for a protection visa.  The Minister treated that application as invalid.  The plaintiff applied to the High Court for an order to quash the decision of the Minister to issue the temporary safe haven visa and an order requiring the Minister to consider the plaintiff’s application for a protection visa according to law.

The plaintiff submitted that the decision to grant him the temporary safe haven visa was invalid, because s 195A did not authorise the grant of a temporary safe haven visa except to afford temporary safe haven, and because the decision was made for the improper purpose of preventing the plaintiff from making other visa applications.  

The High Court rejected those arguments.  A majority of the Court held that it was open to the Minister to grant a temporary safe haven visa by reference to its legal characteristics and consequences, unconstrained by the purpose for which that class of visa was created under the Act.  The purpose for which the Minister granted the visa was not beyond the power conferred by s 195A(2) of the Act.  Accordingly, the decision to grant the temporary safe haven visa was valid and the plaintiff’s application for a protection visa was invalid. 

Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd; Aristocrat Technologies Australia Pty Ltd v Allam [2013] HCA 21

On 2 May 2013, the High Court of Australia refused special leave to appeal against two decisions of the Full Court of the Federal Court of Australia in which the Full Court characterised evidence as tendency evidence, but held that it could not be relied upon as tendency evidence because there had been no compliance with the tendency evidence rule in s 97(1) of the Evidence Act 1995 (Cth) (“the Act”) at first instance. Today the High Court delivered its reasons for refusing special leave.

The respondents were in the business of refurbishing and selling second-hand gaming machines in overseas markets. The applicants alleged that the respondents had infringed their copyright under the Copyright Act 1968 (Cth) by selling second-hand gaming machines assembled using pirated copies of material in which the applicants held the copyright. At first instance, a single judge of the Federal Court admitted email communications of the respondents which were used by the primary judge to satisfy the knowledge element of the alleged copyright infringements. The applicants succeeded at first instance. On appeal, the Full Court held that the primary judge had relied on those email communications to infer that the respondents had a tendency to engage in copyright infringing conduct, thereby satisfying the knowledge element of the alleged infringement. Section 97(1) of the Act provides that evidence of a person’s tendency to act in a particular way is not admissible to prove that tendency unless reasonable notice is given and the court thinks that the evidence has significant probative value.  As there had been no compliance with the tendency rule at first instance, the Full Court held that the email communications could not be used as tendency evidence. The applicants were unable to otherwise prove the knowledge element of the relevant infringements and the appeals were allowed.

The applicants applied for special leave to appeal the decisions of the Full Court to the High Court. The High Court held that it was open to the Full Court to characterise the primary judge’s reasoning as based upon the discernment of a tendency on the part of the respondents, that the applications did not raise any question of public importance and that the Full Court’s decisions were not attended with sufficient doubt to warrant a grant of special leave.  

Director of Public Prosecutions (Cth) v Keating [2013] HCA 20

Today the High Court unanimously held that a person could commit the offence of obtaining a financial advantage from a Commonwealth entity, contrary to s 135.2(1) of the Criminal Code (Cth) (“the Code”), by failing to comply with a Centrelink notice requiring that person to inform Centrelink of a change in circumstances.  The High Court also unanimously rejected the proposition that a person could commit the offence by omitting to perform an act or acts that the person was not under a legal duty to perform at the time of the omission.

On 7 October 2010, Ms Kelli Anne Keating was charged with three counts of obtaining a financial advantage contrary to s 135.2(1) of the Code.  Section 135.2(1) makes it an offence for a person to engage in conduct and, as a result of that conduct, to obtain a financial advantage from a Commonwealth entity, knowing or believing that he or she is not eligible to receive that financial advantage.  The Commonwealth Director of Public Prosecutions alleged that from 2007 to 2009 Ms Keating failed to advise the Department of changes to her income while in receipt of a social security payment.  During this period, Centrelink had issued a number of notices to Ms Keating, under ss 67(2) and 68(2) of the Social Security (Administration) Act 1999 (Cth) (“the Administration Act”), requiring her to inform Centrelink of various matters including changes to her income.  It was not agreed that Ms Keating received those notices.

On 26 October 2011, the High Court handed down its decision in Director of Public Prosecutions (Cth) v Poniatowska (2011) 244 CLR 408.  The Court held that for a person to breach s 135.2(1) by omitting to do something, the omission must be of an act that the person was under a legal duty to perform.

On 4 August 2011, a new s 66A was inserted into the Administration Act.  Section 66A(2) imposes a duty upon a recipient of a social security payment to inform the Department within 14 days of a change of circumstances which might affect the payment.  Section 66A is taken to have commenced on 20 March 2000.

On 14 December 2012, the case against Ms Keating pending in the Magistrates’ Court of Victoria was removed into the High Court.  The Court was asked to decide whether a person could commit an offence under s 135.2(1) of the Code either by failing to comply with the duty imposed by s 66A of the Administration Act at a time before the amendment received the Royal Assent, or by failing to comply with a notice issued by Centrelink under ss 67(2) and 68(2).

The High Court unanimously held that a person could not breach s 135.2(1) of the Code by failing to comply with the duty imposed by s 66A of the Administration Act at a time after 20 March 2000 but before the date on which the amendment received the Royal Assent.  The Court held that for an omission to constitute an offence under s 135.2(1), a person must have failed to do a thing that, at the time of the failure, the law required that person to do.  The Court also held that an offence under s 135.2(1) was capable of being committed by a failure to comply with a notice issued by Centrelink under the Administration Act.

Wallace v Kam [2013] HCA 19

Today the High Court unanimously dismissed an appeal from a decision of the Court of Appeal of the Supreme Court of New South Wales, which held that even if the respondent, Dr Kam, had failed to warn the appellant, his patient Mr Wallace, of all the material risks inherent in a surgical procedure, that failure did not cause the injury suffered by Mr Wallace as a result of one of those risks eventuating.

Dr Kam performed a surgical procedure on Mr Wallace in an effort to relieve him of a condition of his lumbar spine.  The surgical procedure had inherent risks, one of which was of temporary damage to Mr Wallace’s thighs, or “neurapraxia”.  Another was a one-in-twenty chance of permanent and catastrophic paralysis.  The first risk materialised.  The second risk did not.

At trial, the Supreme Court of New South Wales found that while Dr Kam negligently failed to warn Mr Wallace of the risk of neurapraxia, Mr Wallace would have chosen to undergo the surgical procedure even if warned of that risk.  The Supreme Court also concluded that the legal cause of the neurapraxia could not be the failure to warn of some other risk that did not materialise.

On appeal to the Court of Appeal, Mr Wallace argued that the Supreme Court erred in holding that the legal cause of the neurapraxia could not be the failure to warn of the risk of paralysis.  The Court of Appeal assumed that Dr Kam negligently failed to warn Mr Wallace of the risk of paralysis and that, if warned of that risk, Mr Wallace would not have undergone the surgical procedure.  On that assumption, a majority of the Court of Appeal found that Dr Kam was not liable for the neurapraxia.  Mr Wallace appealed by special leave to the High Court.

The High Court held that it was not appropriate for Dr Kam’s liability to extend to the physical injury in fact sustained by Mr Wallace, in circumstances where Mr Wallace would not have chosen to undergo the surgical procedure had he been properly warned of all material risks, but where he would have chosen to undergo the surgical procedure even if he had been warned of the risk that in fact materialised.  The policy underlying the requirement that a medical practitioner exercise reasonable care and skill in warning a patient of material risks inherent in proposed treatment is to protect the patient from the occurrence of physical injury the risk of which is unacceptable to the patient.  The High Court held that Mr Wallace was not to be compensated for the occurrence of physical injury, the risk of which he was willing to accept.

Minister for Immigration and Citizenship v Li [2013] HCA 18

Today the High Court unanimously dismissed an appeal from a decision of the Full Court of the Federal Court of Australia, which held that a refusal by the Migration Review Tribunal (“the Tribunal”) to adjourn review proceedings was unreasonable.

The first respondent, Ms Xiujuan Li, was refused a skilled overseas student residence visa by a delegate of the Minister for Immigration and Citizenship (“the Minister”) on the basis that some of the employment history provided to support the assessment of her relevant skills was not genuine.  Ms Li applied to the Tribunal for a review of the delegate’s decision.  She also applied for a fresh skills assessment.  Upon obtaining that assessment, Ms Li’s migration agent informed the Tribunal that it was unfavourable but explained that because fundamental errors had been made in it, Ms Li was confident of succeeding on her application to the assessing authority for a review.  The migration agent requested the Tribunal delay making a final decision on Ms Li’s review application until the skills assessment review was finalised.  The Tribunal refused that request.  It considered that Ms Li had been provided with enough opportunities to present her case and was not prepared to delay any further.  The Tribunal found that, because the first skills assessment had been affected by fraud, the relevant visa criterion was not met.  The delegate’s decision was affirmed.

Ms Li successfully applied for review of the Tribunal’s decision to the Federal Magistrates Court of Australia.  Burnett FM considered that the Tribunal’s decision to proceed was unreasonable in circumstances where the review of the second skills assessment was the only outstanding matter and where it could be inferred that Ms Li was not attempting to deliberately delay a decision in her case.

The Full Court of the Federal Court unanimously dismissed the Minister’s appeal.  Greenwood and Logan JJ held that the Tribunal had exercised its discretion to adjourn, pursuant to s 363(1)(b) of the Migration Act 1958 (Cth), in an unreasonable manner.  The Minister appealed by special leave to the High Court.

The High Court held that the Tribunal’s exercise of the discretion under s 363(1)(b) was unreasonable.  The Tribunal’s reasons failed to identify any consideration weighing in favour of the abrupt conclusion it brought to the review and none was suggested by the Minister on the appeal.   The failure by the Tribunal to discharge its function under s 363(1)(b) of the Migration Act according to law meant that the Tribunal had acted beyond its jurisdiction in affirming the delegate’s decision.

Beckett v New South Wales [2013] HCA 17

Today the High Court unanimously allowed an appeal from a decision of the Court of Appeal of the Supreme Court of New South Wales, which had held that Ms Roseanne Beckett’s claim for damages for malicious prosecution required proof of her innocence.

In September 1991, Ms Beckett was convicted of eight offences against her husband.  In August 2005, the New South Wales Court of Criminal Appeal quashed the convictions on six of the counts.  The Court entered a verdict of acquittal for one count, and ordered a new trial on the remaining counts.  In September 2005, the Director of Public Prosecutions (“the Director”) gave a direction, pursuant to s 7(2)(b) of the Director of Public Prosecutions Act 1986 (NSW), that no further proceedings be taken against Ms Beckett on the outstanding counts.

In August 2008, Ms Beckett instituted proceedings against the respondent in the Supreme Court of New South Wales, claiming damages for malicious prosecution.  Both parties agreed that the Court should answer separate questions regarding whether Ms Beckett needed to prove her innocence to maintain her claim for damages.  The trial judge held that the Director’s decision not to proceed further with the charges was equivalent to the entry of a nolle prosequi by the Attorney-General.  He applied the High Court’s decision in Davis v Gell (1924) 35 CLR 275, which held that where proceedings have been terminated by the entry of a nolle prosequi, as distinct from other forms of termination, a plaintiff must prove his or her innocence to succeed in a subsequent action for malicious prosecution.  The Court of Appeal affirmed the trial judge’s decision. 

By special leave, Ms Beckett appealed to the High Court.  The High Court unanimously allowed the appeal, holding that Davis should not be followed.  The Court held that a plaintiff is not required to prove his or her innocence in an action for damages for malicious prosecution in any case in which the prosecution has terminated favourably to the plaintiff. 

Commissioner of Taxation v Unit Trend Services Pty Ltd [2013] HCA 16

Today the High Court unanimously allowed an appeal from a decision of the Full Court of the Federal Court of Australia concerning the interpretation of s 165 5(1)(b) of the A New Tax System (Goods and Services Tax) Act 1999 (Cth) (“the GST Act”). 

Unit Trend Services Pty Ltd (“Unit Trend”) is the representative member of a GST group of companies which, at the relevant time, included Simnat Pty Ltd (“Simnat”), Blesford Pty Ltd (“Blesford”) and Mooreville Investments Pty Ltd (“Mooreville”).  Simnat was the developer of residential building unit projects.  When construction of the projects was at an advanced stage, Simnat sold the projects for their then value as going concerns to Blesford and Mooreville, which completed the projects and sold the completed units.

The Commissioner of Taxation (“the Commissioner”) issued a declaration to Unit Trend under the anti-avoidance provisions in Div 165 of the GST Act negating a total GST benefit in excess of $21 million.  This declaration was contested by Unit Trend in the Administrative Appeals Tribunal (“the AAT”), which found in favour of the Commissioner.  The AAT found that the companies were engaged in a “scheme” under s 165-10(2) of the GST Act.  The GST benefit got from the scheme, which Div 165 was being invoked to negate, was the benefit obtained as a result of intermediate sales by Simnat to Blesford and Mooreville of a going concern. The GST benefit reflected the amount agreed to be paid to Simnat by Blesford and Mooreville as the consideration for the intermediate sales, which brought about an uplift in the intermediate cost base of the units supplied by them to buyers of the units.  As a result, the amount of GST payable by Unit Trend was less than it would have been had the scheme not existed. 

The AAT’s decision was subsequently overruled by the Full Court in favour of Unit Trend.  The Full Court held that the GST benefit obtained by Unit Trend was attributable to the making of a choice, election, application or agreement expressly provided for by the GST Act and, therefore, Div 165 did not apply.

On appeal by special leave to the High Court, the issue before the Court was whether the GST benefit obtained by Unit Trend was not attributable to the making of a choice, election, application or agreement that was expressly provided for by the GST Act.  The High Court unanimously held that the phrase “not attributable to” in s 165-5(1)(b) is concerned with whether the GST benefit in question is not one to which the taxpayer was entitled by exercise of a statutory choice. 

Reference to the undisputed facts showed that the GST benefit in question was not attributable to the making of a statutory choice by Unit Trend provided for by the GST Act.  The GST Benefit was, therefore, negated by the anti-avoidance provisions in Div 165. 

Beck v Weinstock [2013] HCA 15

Today the High Court unanimously dismissed an appeal by Mrs Tamar Beck regarding whether shares in LW Furniture Consolidated (Aust) Pty Ltd, described as “C” Redeemable Preference Shares (the “C class shares”), were able to be redeemed under the Corporations Act 2001 (Cth).  The Court rejected Mrs Beck’s argument that the C class shares were not preference shares (and could not be redeemable preference shares) because no ordinary shares or other shares with lesser rights were issued.

LW Furniture was incorporated in 1971.  Its articles of association provided for several different classes of shares, including C class shares.  In 1971, eight C class shares were issued to Mrs Hedy Weinstock.  The company issued other preference shares having the same rights as the C class shares, but never issued any ordinary shares.  Mrs Weinstock died in 2004 and, after her death, the company sought to redeem the C class shares for one dollar each.  As executor of the estate of Mrs Weinstock, Mrs Beck claimed that the C class shares were not redeemable because they were not preference shares.

In the Supreme Court of New South Wales, Hamilton AJ held that the C class shares were not validly issued as preference shares because there were no other shares on issue over which they had preference.  On appeal, the Court of Appeal held that the C class shares were preference shares and had been validly redeemed.  By special leave, Mrs Beck appealed to the High Court.   The High Court unanimously dismissed the appeal.  The High Court held that the C class shares were preference shares and the redemption of shares was valid.  The C class shares were preference shares, as they had rights attached that preferred the holder of those shares to the holder of any ordinary shares in the company on issue when the relevant right was to be examined.

Weinstock v Beck [2013] HCA 14

Today the High Court unanimously allowed an appeal by Mr Amiram Weinstock and Mrs Helen Weinstock regarding the purported appointment of Mrs Weinstock as a director of LW Furniture Consolidated (Aust) Pty Ltd.  The Court held that under s 1322(4)(a) of the Corporations Act 2001 (Cth) Mrs Weinstock’s appointment could be validated even though Mr Weinstock had not been properly appointed as a director when he purported to appoint her as an additional director.   LW Furniture was incorporated in 1971.  Its articles of association required that there be no fewer than two directors.  If the number of directors dropped below two, the continuing director could appoint an additional director.  The two initial directors were the parents of Mr Weinstock and his sister, Mrs Tamar Beck.

In 1973, Mr Weinstock and Mrs Beck were appointed additional directors of LW Furniture until the next annual general meeting of the company.  Their appointment as directors ended before the meeting started.  At that meeting (and those following), it was resolved to reappoint directors retiring at that meeting.  Given Mr Weinstock and Mrs Beck had retired before the meeting began, the resolution did not apply to them and they were not reappointed.

However, both Mrs Beck and Mr Weinstock acted as if they had been validly appointed.  In 1982, Mrs Beck resigned as a director of the company.  In 2003, the father of Mr Weinstock and Mrs Beck died.  Their mother could not hold office as she was unable to look after her own affairs, and Mr Weinstock continued to act as the only director of the company.  He purported to appoint his wife, Mrs Weinstock, as a director of the company.  Mrs Beck challenged this appointment on the basis Mr Weinstock was not a director.

In the Supreme Court of New South Wales, Barrett J made an order under s 1322(4)(a) of the Act declaring the appointment of Mrs Weinstock valid.  On appeal, the Court of Appeal set aside this order.  By special leave, Mr and Mrs Weinstock appealed to the High Court.   The High Court allowed the appeal.  The Court held that the purported appointment of Mrs Weinstock was a contravention of LW Furniture’s constitution and that s 1322(4)(a) of the Act gave power to a court to declare the appointment valid.  The Court remitted the matter to the Equity Division of the Supreme Court of New South Wales for determination.