CHAPTER 8
State Based Body
The option
8.1 A further option identified during the Forum is to establish a dispute
resolution body under State legislation. Mr George Williams proposed
this alternative as a method of insulating the review body from similar
constitutional challenge to that encountered by the SCT.
8.2 Mr Williams contended that a body established under State legislation
could not be found to exercise judicial power in breach of the Constitution
because State bodies are not subject to the separation of judicial power.
8.3 Mr Williams considered that this option is subject to a number of
limitations. These included a fracturing of the superannuation legislation
and problems with gaining a unified system. However, he outlined a methodology
for establishing such a body in a way that would assure a degree of certainty
and uniformity.
8.4 In his proposal, the Commonwealth could legislate for the Australian
Capital Territory to establish a complaints tribunal. The State Parliaments
could then pass identical complementary legislation. While established
by legislation in each State and Territory, only one body would be established
with a commonality of membership and interest across Australia.
Precedents
8.5 The Commonwealth and States have co-operated to establish such a
body in the past. Mr Williams pointed out that this is how the Corporations
Scheme works and that is exactly how a body similar to the SCT, the Corporations
and Securities Panel, was established by the Commonwealth in exercising
its powers for the Territory. [1]
8.6 Mr Williams explained that the Commonwealth had adopted this approach
because the High Court had held for many years that the Commonwealth's
exercise of power was not subject to judicial power limitations when it
is exercising power for the Territories. Assuming established legal precedent
applies, the body would not be subject to the limitations the Federal
Court identified. [2]
Forum views
8.7 Mr Andrew Rogers QC agreed that Mr Williams' proposal is feasible.
He advised the Forum that the proposal is technically sound but politically
difficult:
For whatever my personal views were, I would think that legally and
constitutionally the notion that you should have the exercise of the
Territory power and then adopt it State-wide would be a sound one. How
politically feasible it is is almost like trying to predict what the
High Court is likely to decide in a given case. [3]
8.8 Mr Steve Gibbs of the AIST considered that, while Mr Williams' option
was perhaps least likely to suffer constitutional challenge, it would
take the longest possible time of all the options considered to implement.
[4]
8.9 Mr Mark Cerche of the Corporate Superannuation Association considered
that Mr Williams' suggestion was in fact the only effective method
for establishing a dispute resolution mechanism along the lines of a tribunal.
He advised the Forum that his Association is concerned principally with
certainty. He told the Forum that the current uncertainty associated with
trustee's decisions is intolerable:
We are dealing with the property rights of individuals and it is intolerable
not to know whether the decisions we take are correct or not and then
on review whether the decision-maker in view of our decisions has the
power to do so. It simply causes the system to fall into disrepute.
So I believe that we should aim for legal certainty as the ultimate
goal here. If that means that the system is not as cheap and efficient
as others would like it to be, that is the price we have pay for the
certainty that property rights demand. [5]
8.10 Mr Williams himself cast doubt on whether the State-based alternative
was a viable option. He told the Forum that
… I personally doubt whether it is a viable option at the moment,
given time and given the political willingness to achieve legislation
across all of the States and the Northern Territory. It may be that
five or 10 years down the track this is the solution that is left, but
it is hard to see that it is viable as things currently stand. [6]
8.11 Ms Janet Murphy from the Department of Industry, Science and Tourism
and Consumer Affairs echoed these views in a letter to the Chairman of
the Committee, following the forum. While acknowledging the constitutional
advantage of having the Commonwealth create a tribunal in the ACT and
`copying' its legislation to the states, she emphasised that the time
it would take to achieve uniform legislation and the lack of any guarantee
that the legislation would remain uniform throughout the States and Territories
were major disincentives to adopting this option. [7]
Evaluation against criteria
8.12 The main attraction of adopting this option is certainty. It is
likely that it would be free of the constitutional difficulties in relation
to the exercise of judicial power that have crippled the SCT.
8.13 Constitutional lawyers at the forum pointed out that the High Court
has sanctioned similar legislative arrangements in relation to other tribunals,
notably the Corporations and Securities Panel.
8.14 The Committee notes, however, the significant difficulties highlighted
in forum discussion concerning the political difficulties of negotiating
and maintaining a unified dispute resolution system in the States and
Territories.
8.15 The probable length of time required to implement such a scheme
is also a major disadvantage.
Conclusions
8.16 The Committee considers that this option is sound and offers a high
level of certainty. However a number of factors militate against its adoption.
8.17 Firstly, the evidence suggests that there would be a considerable
time delay before it could be implemented.
8.18 Secondly, there may be difficulties associated with passing consistent
legislation through all the State legislatures. Making any future amendments
may also be a cumbersome and difficult process, as amending legislation
would have to pass through the Parliaments of each State and Territory.
8.19 For these reasons, the Committee does not consider the option is
viable at this time. However, should difficulties associated with the
other options prove insurmountable, the option should then be re-assessed.
Footnotes
[1] Evidence, p. 15.
[2] Evidence, p. 15.
[3] Evidence, p. 17.
[4] Evidence, p. 20.
[5] Evidence, p. 22.
[6] Evidence, p. 62.
[7] Correspondence dated 15 May, 1998.
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