PART B CHAPTER 1
Independence of the Judiciary
[T]he pension is regarded by judges as enormously important.
It is not just remuneration; it forms a part of the structure of the
judiciary - the way in which the judiciary is recruited, how it lives
- and part of the principles that guide life on the bench [1]
Judicial independence: what it is and why it matters
1.1 The Committee received extensive evidence contending that judicial
pensions had greater significance than simply being part of a remuneration
package. This evidence claimed that a judicial pension scheme was one
of the mechanisms for protecting judicial independence, and that therefore
the scheme should not be altered in a way which would diminish independence.
1.2 The Hon. Justice Daryl Davies of the Federal Court of Australia emphasised
the importance which judges place on pension arrangements, as one of a
number of elements which are essential to judicial independence:
[S]ecurity of tenure, adequacy of stipend and adequacy of pension
on retirement are essential pillars of the independence of the judiciary.
The remuneration is directed to assisting judges to draw apart form
the world of moneymaking and to provide the judge with financial independence,
both during his term as a judge and on retirement. [2]
1.3 Mr Richard Moss, Deputy Secretary of the Attorney-General's Department,
agreed, advising the Committee that:
I think it is a well-established proposition that there is or
could be a direct relationship between remuneration and independence,
in two senses. Firstly, it is considered appropriate, and has for a
long time, that judges should be paid a remuneration both in respect
of their working lives and their retirement lives which is sufficient
to make them independent within the generally accepted meaning of the
word. Secondly, any ability of government to affect adversely a judge's
remuneration - again either during their working life or their retirement
- may be either actually or be perceived to be a means of influencing
judges. [3]
1.4 The views put to the Committee referred to in paragraphs 1.2 and
1.3 above are, as Mr Moss noted, 'well established'. [4]
Until the seventeenth century, English judges generally served at the
pleasure of the Crown (durante bene placito, that is, they could be dismissed
without cause). However, after the 'Glorious Revolution' of 1688-89, all
English judicial appointments were made during the judges' good behaviour
(quam diu se bene gesserint). The Act of Settlement 1701 (UK) put this
practice on a statutory basis, dealing with judicial remuneration at the
same time, by providing for English judges that:
commissions be made quam diu se bene gesserint,
and their salaries ascertained and established; but upon the address
of both houses of Parliament it may be lawful to remove them'. [5]
These protections have been carried through into section 72 of the Commonwealth
Constitution (see below paragraph 2.13).
1.5 There is a tradition of bipartisan parliamentary support in Australia
for judges' pensions as a support for judicial independence. In the parliamentary
debate on the Judges Pensions Bill 1948, it was stated that the bill:
'was a contribution towards the independence and impartiality of the judiciary.
Anything that directs itself toward that end is to be supported'. [6]
In the parliamentary debate on the Judges Pensions Bill 1968, the point
was made that 'pensions are a necessary ingredient of that feeling of
independence which all judges should feel'. [7]
It was noted that:
pensions are paid to judges so that in retirement they may enjoy
the same dignity and independence, and be known to enjoy them, as we
would insist on them enjoying while they were in service. [8]
1.6 An earlier inquiry, the Connor/Marks Inquiry in Victoria, stated
in its Report on Judicial Conditions of Appointment that a judicial pension
scheme is a support for judicial independence. The report noted that:
[a] judicial pension is not something which a Judge has earned
for service but something which the community, in its own interests,
requires a Judge to have. [9]
1.7 An underlying reason for judicial independence is to guarantee the
impartiality of the judiciary. This was stated by the Supreme Court of
Victoria, as follows:
Public confidence in the impartial administration of justice
can be maintained only if it is clear that cases are decided according
to law without regard to whether the decision may have some effect to
the advantage or disadvantage of the judge concerned. [10]
1.8 The connection between independence and impartiality has been recognised
internationally. As Chief Justice Antonio Lamer of the Canadian Supreme
Court has stated:
Judicial independence is, at its root, concerned with impartiality,
in appearance and in fact. And these, of course, are elements essential
to an effective judiciary. Independence is not a perk of judicial office.
It is a guarantee of the institutional conditions of impartiality. [11]
1.9 The importance of the matters which the judiciary decides serves
to underline the need for impartiality. Federal judges make decisions
which affect the respective positions of the federal and State/Territory
governments in our federation, and which affect the rights of individuals.
[12]
1.10 Federalism involves a managed distribution of power between central
(federal) and regional (State/Territory) governments. The federal judiciary
is the umpire in the legal contests between the different levels of government.
It has been said that federal constitutional arrangements 'could not be
carried into practical effect' without the judiciary having the role of
deciding on the constitutional validity of government actions (described
as "judicial review"). [13]
The Privy Council has stated that:
[I]n a federal system the absolute independence of the judiciary
is the bulwark of the constitution against encroachment whether by the
legislature or by the executive. To vest in the same body executive
and judicial power is to remove a vital constitutional safeguard. [14]
1.11 The judiciary is also the umpire in legal disputes relating to the
rights of individual citizens, both in relation to other citizens, and
in relation to government. The independence of the judiciary protects
individual rights, by providing that 'the life, liberty, and property
of the subject [is not] in the hands of arbitrary judges, whose decisions
[are] then regulated only by their own opinions, and not by any fundamental
principles of law'. [15]
Mechanisms to support judicial independence
1.12 Section 72 of the Constitution provides for certain matters which
have been seen traditionally as important for the protection of judicial
independence. These are security of:
- tenure; and
- remuneration.
1.13 As noted above in paragraph 2.4, Section 72's protections can be
traced back to the Act of Settlement 1701 (UK). In respect of security
of tenure, section 72 provides that federal judges shall hold office until
retirement age, [16] unless they are
removed following an address from both Houses of Parliament on 'the ground
of proved misbehaviour or incapacity'.
1.14 In respect of security of remuneration, section 72 provides that:
The Justices of the High Court and the other courts created by
the Parliament: ... (iii) shall receive such remuneration as the Parliament may fix;
but the remuneration shall not be diminished during their continuance
in office.
1.15 Judicial independence also has wider significance as a matter of
principle or policy which goes beyond the specific requirements of constitutional
law. Governments may exercise restraint in taking decisions which, although
constitutionally valid, could nevertheless be regarded as diminishing
judicial independence.
1.16 The design of the judicial pension scheme is entwined with the principle
of judicial independence in two ways: the scheme, being part of remuneration,
could not be altered in a way that would be contrary to section 72 (see
paragraphs 1.17-1.19); and the scheme's features do reflect its role in
supporting judicial independence (see paragraphs 1.21-1.26).
1.17 The Committee of Judges of the Federal Court argued that the requirement
of section 72(iii) of the Constitution that judges' remuneration be fixed
by Parliament, would preclude remuneration arrangements being made contractually
between the Commonwealth and individual judges. [17]
As the Committee of Judges of the Federal Court of Australia stated:
The words 'receive such remuneration as the Parliament may fix'
[in section 72(iii) of the Constitution] are not apposite to encompass
remuneration arrangements of the type entered into by senior executives
in the work force. [18]
1.18 The Committee of Judges of the Federal Court of Australia also stated
that section 72(iii) of the Constitution 'seems to imply that Parliament
will fix the remuneration of the judges of the court as a whole, rather
than fixing differing remunerations for individual judges all of whom
perform the same function'. [19]
1.19 The Attorney-General's Department, however, was of the view that
it is constitutionally possible for judges to have different levels of
remuneration. [20] The significance
of this point is that, unless this were the case, it is hard to envisage
how the judicial pension scheme could ever be diminished. Professor George
Winterton also queried the argument of Committee of Judges of the Federal
Court, noting changes to judicial pension schemes overseas:
As a matter of fact, in Canada and New Zealand it does happen
[that judges have different levels of remuneration] because of changes
to the pension scheme that judges of the same court appointed before
a certain date and after a certain date are on different pension arrangements.
So there are precedents for it. [21]
1.20 The Committee acknowledges that there is legal debate regarding
the requirements of section 72 of the Constitution. However, it is questionable
whether the section would preclude judges receiving different levels of
remuneration. Clearly, however, it would not be permissible to reduce
the remuneration of current judges.
A more mobile judiciary?
1.21 The Hon. Chief Justice Alastair Nicholson, AO RFD, of the Family
Court of Australia recognised that the current structure of the judicial
pension scheme encouraged judges to remain in service by being a 'golden
chain', but stated that this had undesirable side-effects:
[A] judge would really feel, even though they might want to retire
and perhaps should retire, that they cannot afford to retire until the
age of 60. They may well have given 20 years service.... It seems to
us that this is an inequitable system and it is not a desirable system
from the point of view of the public. In effect, the golden chain of
superannuation is used to tie them into a position. [22]
1.22 A scheme which encouraged early retirement of judges could be seen
as a threat to judicial independence in that younger judges may have greater
interest in pursuing post-judicial employment.
1.23 Several witnesses said the judicial pension scheme should not encourage
early retirement. The Supreme Court of Victoria stated:
On no view, however, should the scheme for judges' retirement
benefits encourage judges to seek other employment after retirement
and on no view should the scheme discourage judges from serving in office
for as long as they are able to do so. [23]
1.24 On the topic of commutation of judicial pensions, Justice Davies
stated:
We would not like to see any arrangements which encourage early
retirement.... We like judges to go on knowing they are giving up their
practice at the bar, they are taking a judicial office and they are
going to stay through until the end. [24]
1.25 Ms Renée Leon, Assistant Secretary, Courts, Tribunals and
Administrative Law Branch, Attorney-General's Department stated:
I think there is still much to be said for seeing the bench as
a place to which one gives long and dedicated service rather than simply
a staging post. [25]
1.26 The Committee considers that judicial office should be seen as a
long-term career commitment, and agrees that the judges' pension scheme
should not encourage early retirement. However, this is not necessarily
inconsistent with a greater flexibility in the scheme than currently exists.
Restraints on judges' financial affairs before and after retirement
1.27 Judges operate under a range of restraints, set both by law and
by convention, which limit their behaviour, particularly in relation to
financial matters. It was explained to the Committee that judges had a
role in setting examples in behaviour:
It is a not unreasonable public expectation that judges will
set an example be exhibiting a high order of behaviour in both their
public and private lives. There are many forms of activity which, in
practical terms, are not considered appropriate, lest they be seen to
compromise the individual judicial officer. [26]
1.28 In relation to financial matters, there 'is a tradition of freedom
from business connections ... this is a cornerstone of judicial conduct'.
[27] The Committee was told that:
Judges, in effect, have to withdraw from commercial investments
other than perhaps real estate and shares in public companies. Even
that may be constrained to some degree by the nature of the work that
the judges are doing or the companies concerned. [28]
1.29 In relation to post-retirement financial activities, Mrs Maggie
Jackson, Deputy Government Counsel, Civil Law Division, Attorney-General's
Department, informed the Committee that:
[I]f the judiciary were to become merely a stepping stone in
a person's career, there is a risk that judicial independence would
be infringed because of a concern that people are, perhaps, making decisions
which are favourable to their future career prospects in business, in
industry, as politicians or whatever. [29]
1.30 The areas where retired judges would appear most likely to work
after judicial service are:
- for government (including Royal Commissions and similar inquiries);
and
- in the private sector, either in alternative dispute resolution or
as a barrister.
1.31 The Attorney-General's Department told the Committee that there
is no reduction or suspension of the judicial pension on the ground that
the retired judge is receiving any income from any other source, including
employment (whether in the public or private sectors). [30]
1.32 Ms Leon explained to the Committee that government post-retirement
employment of judges should not be discouraged:
Quite often judges are highly skilled individuals who have a
wealth of experience and knowledge to offer. Indeed, governments from
time to time seek to take advantage of that skill and knowledge by,
for example, using retired judges on royal commissions and similar inquiries.
I would think we would not wish to discourage the use of judges for
that particular skill. [31]
1.33 In relation to retired judges working in alternative dispute resolution
as arbitrators and mediators, Mr Moss of the Attorney-General's Department
noted that several retired judges undertook this work, and said
I think our view, and the general view, of that would be that
it is entirely unobjectionable and that there is no problem with it'.
[32]
1.34 In relation to working as a barrister, the Committee was informed
that the individual bars had varying rules preventing retired judges from
appearing as counsel before the particular courts in which they had been
judges for certain periods after retirement. [33]
However, a retired judge would be able to appear as counsel in a different
court from that in which they had served as a judge, or to write legal
opinions in respect of matters generally. [34]
The National Commission of Audit's contribution to the debate
1.35 Debate on judicial superannuation has been stimulated by the following
recommendation of the National Commission of Audit (NCOA):
Superannuation for Parliamentarians and Judges should be structured
in a similar way to arrangements for senior executives in the rest of
the workforce. That is, superannuation should be paid through accumulation
benefit arrangements and the amount of superannuation should be determined
by individuals as part of a fixed overall remuneration package. [35]
1.36 However, the Committee of Judges of the Federal Court of Australia
stated that 'few persons would think that the appointment of a judge was
equivalent to the taking of appointment as a senior executive in commercial
enterprise'. [36] The Judges and Masters
of the Supreme Court of Western Australia pointed to the issue of judicial
independence, as making judges different from senior executives in the
private sector:
In the event that Judges were placed upon the same basis as 'senior
executives' and able to make individual contractual arrangements, particularly
in relation to obtaining tax advantages, there could be a real danger
that judicial independence could be compromised or that there would
be a perception of such compromise. [37]
1.37 One particular area where the proposal for an accumulation scheme
for judges raises concern is in relation to judicial decisions which affect
the economy (and therefore affect the benefits paid by accumulation funds).
Under the current judicial pension scheme, a retired judge is paid a defined
benefit (which is a fixed amount of money linked to salary level).
1.38 The submission of Mr Peter Szalay, which was in accord with the
recommendation of the NCOA on this point, suggested that the present judicial
and parliamentary superannuation arrangements should be replaced by a
fully funded accumulation scheme. [38]
One of the reasons which he gave for this was that:
... the performance of the MP's scheme becomes linked to the
performance of the Australian economy, thus giving MP's/Judge's [sic]
a very significant interest in ensuring the performance of the economy.
[39]
1.39 However, as judicial decisions can affect whole sectors of the economy,
it was put to the Committee by the Supreme Court of Victoria that:
[I]f retirement benefits for judges are made to depend upon the
investment performance of some pooled or individual market linked fund,
it will be said that the decisions in some cases or kinds of case have
been affected by the commercial interest of the judges in their retirement
benefits. [40]
1.40 The Supreme Court of Victoria believes that the problem of public
perception of a loss of judicial independence would still continue, even
if there was a 'blind trust' (that is, judges were unable to know where
there superannuation moneys were invested). The Court believed that allegations
'will too readily be made' that judicial decisions were influenced by
the effect of market performance on judicial superannuation benefits.
[41]
1.41 The Committee is of the view that the NCOA's recommendation quoted
above would give rise to complicated issues in terms of guaranteeing judicial
independence, were the recommendation to be considered for implementation.
1.42 More specifically perhaps, the Committee does not consider the NCOA's
view (outlined in paragraph 1.35 above) as relevant to judges. The position
of judges is unlike the occupations cited by the Commission.
Conclusion
1.43 The Committee takes the view, on the evidence it has received, that
the judicial pension scheme does indeed have a greater role than just
being part of a remuneration package. The Committee recognises that judicial
independence is a guarantee of the impartiality of the judiciary, which
underpins the federal nature of the Commonwealth, and the protection of
individual rights. The Committee shares the widespread view that secure
and adequate judicial remuneration, during retirement as well as during
service, is essential to judicial independence.
Footnotes
[1] Evidence, Justice Davies, p. 13.
His Honour appeared as a representative of a Committee of Judges of the
Federal Court of Australia (referred to hereinafter as the 'Committee
of Judges of the Federal Court '), see Evidence, p. 37.
[2] Evidence, Justice Davies, p. 14.
See also quotation at head of chapter. And see also: Submission No.
1, Chief Justice Cox of the Supreme Court of Tasmania, p. 1; Submission
No. 2, Judicial Remuneration Coordinating Committee, p. 2.
[3] Evidence, Mr Richard Moss, pp. 64-65.
[4] On the history of judicial independence
in common law countries see: M Friedland, A Place Apart: Judicial Independence
and Accountability in Canada (1995), pp. 3-6; J Quick and R.R. Garran,
The Annotated Constitution of the Australian Commonwealth (1901),
pp. 728-729.
[5] The phrase 'English judges' has been used
because the practice of judges serving at pleasure continued in the colonies
until much later. The Act of Settlement addressed the issue of salaries.
In relation to judicial pensions in England, it remained the case until
1799 that the Crown had a complete discretion as to whether to grant a
pension to a retired judge (M Friedland, A Place Apart: Judicial Independence
and Accountability in Canada (1995), p. 3).
[6] The Hon. P.C. Spender K.C., House of Representatives,
Hansard, 30 November 1948, p. 3624. See also the Hon. E.J. Holloway,
House of Representatives, Hansard, 17 November 1948, p. 3071.
[7] Mr E.G. Whitlam QC, House of Representatives,
Hansard, 14 November 1968, p. 2899.
[8] Mr E.G. Whitlam QC, House of Representatives,
Hansard, 14 November 1968, p. 2899.
[9] Victoria, X Connor QC and F. Marks QC, Report
on Judicial Conditions of Appointment (1992), p. 165.
[10] Submission No. 35, Supreme Court
of Victoria, p. 3.
[11] Speech at the Annual Meeting of the Canadian
Bar Association in Toronto, 20 August 1994, p.4, quoted in M. Friedland,
A Place Apart: Judicial Independence and Accountability in Canada
(1995), p. 1.
[12] This was submitted to the Committee by
the Remuneration Tribunal, Submission No. 45, p. 3.
[13] R v Kirby; Ex p Boilermakers' Society
of Australia (the Boilermakers' case) (1956) 94 CLR 254 at
267-268 per Dixon C.J., McTiernan, Fullagar and Kitto J.J. (High Court).
[14] Attorney-General (Cth) v The Queen
(the Boilermakers' case) (1957) 95 CLR 529 at 540-541 (Privy Council);
see also the preceding High Court stage of the case, the Boilermakers'
case (1956) 94 CLR 254 at 276 per Dixon C.J., McTiernan, Fullagar
and Kitto J.J. (High Court). Cf A.V. Dicey, Introduction to the Study
of the Law of the Constitution (10th ed 1959) at 175-176.
[15] Blackstone (Commentaries (17th
ed 1830) Vol 1 at 269), quoted in: Polyukhovich v The Commonwealth
(1991) 172 CLR 501 at 606 per Deane J; and Huddart, Parker & Co
Pty Ltd v Moorehead (1909) 8 CLR 330 at 382-383 per Isaacs J.
[16] Before an amendment to the Constitution
in 1977, federal judges were appointed for life. The current retirement
age for High Court judges is set in the Constitution as 70; for other
federal courts the retirement age is set by specific legislation (but
cannot be higher than 70). The current retirement age of Federal Court
and Family Court judges is 70. Federal judges who were appointed before
the 1977 constitutional amendment retained their lifetime appointment.
[17] Submission No. 8, Committee of
Judges of the Federal Court of Australia, p. 8.
[18] Submission No. 8, Committee of
Judges of the Federal Court of Australia, p. 7.
[19] Submission No. 8, Committee of
Judges of the Federal Court of Australia, pp. 11-12.
[20] Evidence, Mr George Witynski, p.
72.
[21] Evidence, Professor George Winterton,
p. 52.
[22] Evidence, Chief Justice Nicholson,
p. 44.
[23] Submission No. 35, Supreme Court
of Victoria, p. 5.
[24] Evidence, Justice Davies, p. 17.
[25] Evidence, Ms Renee Leon, p. 83.
[26] Submission No. 1, Judicial Remuneration
Co-ordinating Committee, p. 3.
[27] J.B. Thomas, Judicial Ethics in Australia
(1988), p. 45, and see generally at pp. 45-49.
[28] Evidence, Chief Justice Nicholson,
p. 43.
[29] Evidence, Ms Maggie Jackson, p.
68. See also Submission No. 35, Supreme Court of Victoria, p. 5.
And see also Professor Winterton, Evidence, p. 55.
[30] Evidence, Mr Richard Moss, pp.
76-77.
[31] Evidence, Ms Renee Leon, p. 78.
[32] Evidence, Mr Richard Moss, p. 68.
[33] Evidence, Mr Richard Moss, p. 68.
[34] JB Thomas, Judicial Ethics in Australia
(1988), p. 68.
[35] National Commission of Audit, Report
to the Commonwealth Government (1996), recommendation 5.7, p. 99.
[36] Submission No. 8, Committee of
Judges of the Federal Court of Australia, p. 5. See also Submission
No. 8B, Chief Justice Nicholson, p.1.
[37] Submission No. 29, Judges and Masters
of the Supreme Court of Western Australia, pp. 4-5.
[38] Submission No. 18, Mr Peter Szalay,
p. 2.
[39] Submission No. 18, Mr Peter Szalay,
p. 2.
[40] Submission No. 35, Supreme Court
of Victoria, p. 3.
[41] Submission No. 35, Supreme Court
of Victoria, p. 3.
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