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HIGH COURT OF AUSTRALIA

Airservices Australia v Canadian Airlines International Ltd

[1999] HCA 62

Gleeson CJ, Gaudron, McHugh, Gummow, Kirby, Hayne, Callinan JJ

14-15 April, 3 May, 2 December - Canberra

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Gaudron J.   107  The facts and the history of these proceedings are set out in the joint judgment of Gleeson CJ and Kirby J. I shall repeat them only to the extent necessary to make clear my reasons for concluding that the appeals should be dismissed. I reach that conclusion not on the ground that the determination of charges made by the Civil Aviation Authority (the Authority) pursuant to s 66(2) of the Civil Aviation Act 1988 (Cth) (the CA Act 1988) was invalid, but on the ground that s 69 , which purports to authorise the imposition of liens for unpaid charges and penalties, is invalid in its application to the property of the respondents, being companies which did not incur those charges and penalties.

Legislative provisions relevant to the fixing of charges

  108  The CA Act 1988 was amended in significant respects in 1995. It is convenient to refer to the CA Act 1988 as if it had been repealed. References to its provisions are references to the provisions as they stood prior to the 1995 amendments.

  109  By s 8 , the CA Act 1988 established the Authority, a number of whose functions were later assumed by the appellant, Airservices Australia. ^[1] The Authority ' s functions included regulatory functions and, also, the provision of various civil aviation services and facilities including air route and airway facilities, and air traffic control, firefighting and other services. ^[2] Those functions had previously been performed by the Department of Transport and Communications.

  110  Strictly, the establishment of the Authority was simply an occasion for the vesting of governmental functions and responsibilities in a public or statutory body largely independent of government. It occurred, however, at a time of marked change in government and political economic theory. "Corporatisation" , "privatisation" and "user pays" were gaining wide acceptance, along with "small government" . And the "user pays" concept appears to have influenced a number of the provisions of the CA Act 1988.

  111  The CA Act 1988 allowed for the transfer from the Commonwealth to the Authority of various rights, assets, debts, liabilities and obligations. ^[3] Where assets were transferred from the Commonwealth to the Authority, s 51 provided for their valuation and, also, for a determination to be made as to the extent that the Authority was to be taken to have received a loan of the amount involved. In that context, s 54 provided for the identification of the capital of the Authority and for it to be repaid to "the Commonwealth at such times, and in such amounts, as the Minister determine[d]" . Provision was also made for the payment of dividends to the Commonwealth. ^[4]

  112  The Authority was established with a Board ^[5] which was "to ensure that the Authority perform[ed] its functions in a proper, efficient and economical manner" . ^[6] The Board was to develop a corporate plan which identified the objectives of the Authority and the strategies and policies to be pursued. ^[7] It was also to prepare a financial plan for the period covered by the corporate plan. ^[8] When preparing that plan, the Board was required by s 45 to consider, amongst other things:

   

 (e)  the need to maintain a reasonable level of reserves, having regard to estimated future infrastructure requirements;

 (f)  the need to maintain the extent of the Commonwealth ' s equity in the Authority;

 (g)  the need to earn a reasonable rate of return on the Authority ' s assets (other than assets wholly or principally used in the performance of regulatory functions or the provision of search and rescue services);

 (h)  the expectation of the Commonwealth that the Authority will pay a reasonable dividend; and

 (j)  any other commercial considerations the Board thinks appropriate.

  113  By s 66(2) , the Board was empowered to make determinations "fixing charges and specifying the persons by whom, and the times when, the charges [were] payable" and, also, fixing penalties payable in the event that those charges were not paid within time. ^[9] Charges and penalties were recoverable as debts due to the Authority. ^[10] By s 66(1) "charge" was defined to mean "a charge for a service or facility provided by the Authority" and, also, fees and charges for matters specified by regulation in respect of which expenses were incurred by the Authority. This case is concerned only with charges for services and facilities.

  114  Charges were to be fixed in accordance with s 67 which provided:

   

The amount or rate of a charge shall be reasonably related to the expenses incurred or to be incurred by the Authority in relation to the matters to which the charge relates and shall not be such as to amount to taxation.

Construction of s 67 of the CA Act 1988

  115  The first question which arises in relation to s 67 is whether it imposed a single composite requirement, as was held by the full court of the Federal Court of Australia, ^[11] or 2 requirements, namely, (i) that the amount of the charge should be "reasonably related to the expenses … in relation to the matters to which the charge relates" and (ii) that it not "amount to taxation" .

  116  Had s 67 of the CA Act 1988 required that a charge be reasonably related to the cost of providing a particular service to a particular user, there would be much to commend the view that s 67 imposed a single test for, in that event, a charge which bore that relationship to the service provided would not amount to taxation. And that construction would be reinforced by those provisions of the CA Act 1988 which appear to have been influenced by the "user pays" concept. However, the relationship which s 67 postulated is not a reasonable relationship between the amount of the charge and the cost of a particular service rendered to a particular user, but between the amount of the charge and "the expenses incurred or to be incurred … in relation to the matters to which the charge relates" .

  117  "Matters" is a word of complete generality. And s 67 left it to the Authority to determine at what level of generality it might specify the matters in relation to which charges were determined. They might, for example, be flight services and facilities generally; they might be services or facilities of a particular kind or services and facilities provided in particular areas or at particular locations. Indeed, they might even be the particular services provided to particular users at particular times and places. But they need not be. All that s 67 required was that, once the Authority determined the matters to which the charges would relate, there should be a reasonable relationship between the rate of charge and the expenses incurred or to be incurred in relation to those matters.

  118  The notion of "reasonable relationship" , as postulated by s 67 of the Act, is as indeterminate as is that section ' s reference to "matters to which the charge relates" . Relevantly, the relationship postulated by s 67 is between "the amount or rate of a charge" and "the expenses incurred or to be incurred" . However, that relationship is to be determined in a commercial context in which the Authority was, by s 45 , expected to pay dividends to the Commonwealth, ^[12] and to make provision for infrastructure requirements, the maintenance of the Commonwealth ' s equity, and the need to earn a reasonable rate of return on its assets. In that context, there is a reasonable relationship between the amount of a charge for a service and the expenses incurred or to be incurred in providing that service if the charge is calculated to produce an amount equivalent to those expenses and to generate sufficient profit for future infrastructure requirements and those other matters for which the Authority was expected to provide. I have expressed the relationship as one that depends on calculation because no closer relationship can be postulated in circumstances where the relevant expenses were specified as "expenses incurred or to be incurred" .

  119  As already explained, however, a determination need not fix a charge for a specific facility or service. All that was required by s 67 of the CA Act 1988 was that a charge be fixed in relation to matters. Thus, for example, if a charge were made in relation to air services generally, there would, in my view, be a reasonable relationship with those matters if the charge were calculated to produce an aggregate amount equivalent to the expenses associated with the provision of those services and to yield a profit sufficient to meet the commercial expectations of the Commonwealth and, also, to meet the Authority ' s future infrastructure requirements.

  120  Once it is accepted that, in its first limb, s 67 was simply postulating a relationship of the kind indicated between the rate of a charge and the expenses associated with the matters to which the charge related, which matters might be specified at any level of generality, there is ample scope for the independent operation of the requirement that the rate of charge not "amount to taxation" . Thus, in my view, s 67 is to be construed as having 2 separate requirements, each of which had to be satisfied for a valid determination to be made. The meaning and effect of the requirement that the amount or rate of a charge not amount to taxation will be discussed later in these reasons.

The determination

  121  On 26 June 1991, the Authority made a determination under s 66(2) of the CA Act 1988 (the Determination) fixing various charges, including what were called "Landing Charges" , "En route Charges" and "Meteorological Charges" . No issue arises in these appeals with respect to meteorological charges and no further reference will be made to them. ^[13]

  122  "Landing charge" was defined in the Determination to mean "a charge payable in respect of use by aircraft of facilities or a service relating to an aerodrome" . The charge, which was expressed in the Determination to be imposed in respect of each landing, had 2 components: one for "Terminal navigation facilities and services" and the other for a "Fire fighting and rescue service" . However, as the definition makes clear, the charge was not for terminal navigation and fire fighting services, as such, but for "use by aircraft of facilities or a service relating to an aerodrome" . The rate for each component of the landing charge was fixed at a rate per 1000 kg of maximum takeoff weight, with the aerodromes at which the charge was payable varying as between avtur and non - avtur aircraft. ^[14]

  123  By cl 11 of the Determination, a charge was made payable on each landing "[i]n respect of the use by an aircraft of air route and airways facilities and services operated or provided in Australian territory" . The Determination called these charges "En route charges" . They were calculated by reference to specified formulae which again differed as between avtur and non - avtur aircraft and, also, as between flights within and flights into Australia. The formulae took account of the distance travelled between aerodromes within Australia or, in the case of aircraft flying international routes, the distance travelled within Australian air space and, also, maximum takeoff weight or its square root.

The respondents' contentions with respect to the charges

  124  By Notices of Contention, the respondents raise various matters relating to the charges fixed by the Determination. By reference to those matters it was argued on their behalf that the landing and en route charges offended each of the requirements in s 67 of the CA Act 1988. In order to understand their argument, it is necessary to say something as to the method by which the charges were fixed and, also, as to their differential impact on different users.

  125  At first instance, Branson J accepted the evidence of Mr Christopher Barnes as to the manner in which the charges were fixed. At the relevant time, Mr Barnes was employed by the Authority as its Manager, Business Strategy. Her Honour summarised his evidence as follows: ^[15]

   

Mr Barnes' evidence was that the first step was for an estimate to be made of the total outgoings of the [Authority] for the 1991-92 year. The second was to calculate the total value of the [Authority ' s] assets and to calculate 7.5% of such value. Interest to be paid was deducted from the estimated outgoings and 7.5% of the value of the [Authority ' s] assets added to the estimated outgoings. The figure which resulted from this procedure was treated as the cost of the [Authority]. The cost … was then broken down into the cost of each service so that the aggregate of the revenue from each service covered the cost of the [Authority].

Mr Barnes accepted that the break down of the total costs into the costs for each service or facility for which charges were to be determined could not be done with complete accuracy. Particularly was that so with respect to indirect costs and support costs. His evidence was that the allocation of costs was done on the basis of a 1988 cost allocation study. ^[16]

  126  The next step in the process of fixing the charges was to allocate costs to particular users. This was done by application of what are known as "Ramsey pricing principles" . According to the evidence, those principles, in their application to public sector monopolies, involve:

 1.  the recovery of total costs from users as a group;

 2.  each user paying the marginal cost of each service, that is the increment to total cost entailed in producing one extra unit of service;

 3.  the setting of prices for different users in inverse relation to their price sensitivity.

  127  The result of the application of Ramsey pricing principles was that the charge to a particular user for a particular service did not necessarily reflect the cost to the Authority of providing that service. In this context, it was contended on behalf of the respondents that the charges favoured international operators over domestic operators and non - avtur aircraft over avtur aircraft. It was also put that use of maximum takeoff weight or its square root in the calculation of charges had the consequence that the charge levied for a particular service to a particular aircraft was not related to the cost of providing that service. It was by reference to these matters that it was argued that the charges fixed by the Determination contravened the requirements of s 67 of the CA Act 1988.

Reasonably related: the matters in relation to which the charges were made

  128  The first step in determining the question of reasonable relationship, for the purposes of s 67 , is to ascertain, in the case of each charge, "the matters to which the charge relates" . So far as the landing charge is concerned, those matters are identified by the definition of "landing charge" as "use by aircraft of facilities or a service relating to an aerodrome" . Clearly, the definition is not directed to particular aircraft, particular facilities or particular services. And although it is, perhaps, less clear, it is not directed to the facilities or service provided at any particular aerodrome. That follows from the use of the indefinite article - "an aerodrome" - in a context in which there is an absence of specificity in relation to aircraft, facilities or services.

  129  So, too, the "matters" in relation to which en route charges were fixed were not particular facilities or services. Rather, by cl 11 of the Determination, the relevant matter was "the use by an aircraft of air route and airways facilities and services operated or provided in Australian territory" . In a context involving the provision of air route and airways facilities and services generally, the use of the indefinite article in the expression "an aircraft" is to be taken to refer to aircraft in the abstract and not to any particular aircraft.

  130  Once it is appreciated that, for the purposes of s 67 of the CA Act 1988, the matters to which the charges fixed by the Determination relate are, respectively, facilities and services relating to an aerodrome, generally, and air route and airways services, generally, it follows that the relationship required was not a relationship between a charge and the cost of the particular service or services provided, but a relationship between the charge and the expenses incurred or to be incurred with respect to the provision generally of the services and facilities to which the charge related.

  131  As the landing and en route charges were calculated to produce an aggregate return covering the costs of the services and facilities to which each charge related together with a profit calculated at 7.5% of that proportion of the Authority ' s assets allocated to those services and facilities, which assets did not include those used for its regulatory functions, it cannot be said that the charges were not reasonably related to the expenses incurred or to be incurred in relation to the matters to which they related. And because each charge was fixed by reference to services and facilities generally, it is irrelevant that it was not reasonably related to the cost of supplying a particular service or particular services to a particular user.

Taxation: fee for service

  132  A tax is traditionally understood as "a compulsory exaction of money by a public authority for public purposes, enforceable by law, and … not a payment for services rendered" . ^[17] There was nothing in the CA Act 1988 to suggest that the second requirement of s 67 was intended to do other than reflect that meaning. More precisely, it is clear that that requirement was directed to ensuring that the amount of any charge was such that it might properly be characterised as a fee for service. That is so because, in the context of the Act, any determination by the Authority would necessarily involve the exaction of money by a public authority for a public purpose. And because money was to be exacted by what was, in essence, a public sector monopoly, the charge inevitably involved practical, if not legal, compulsion. ^[18]

  133  For an exaction to constitute a fee for service, some service must actually be provided to the person liable to pay. It is not sufficient that the charge be levied to defray the expenses of an authority charged with the performance of functions which benefit the class of persons from whom it is exacted. ^[19] There must be "particular identified services provided or rendered individually to, or at the request or direction of, the particular person required to make the payment" . ^[20] In the present case, services were undoubtedly rendered individually to the person required to make the payment and, if not expressly requested by that person, then impliedly so. And the fact that there was some practical compulsion as to the use of those services cannot alter the character of a charge if it is otherwise a fee for service. ^[21]

  134  The argument for the respondents that the charges were not properly to be characterised as fees for service had 2 prongs: the first was that there was no relevant relationship between the charges and the services provided to individual users; the second, that by reason of the application of Ramsey pricing principles, some users were subsidising others. In essence, however, those matters raise identical questions, namely, whether there must be some relationship between the amount charged and the services provided before the charge can be characterised as a fee for service, and, if so, the nature of that relationship.

  135  There are a number of statements in decisions of this court to suggest that some relationship may be necessary if a charge is properly to be characterised as a fee for service. Thus, in General Practitioners Society v Commonwealth ^[22] it was hypothesised that "an exaction may be so large that it could not reasonably be regarded as a fee" . Similarly, in Hematite Petroleum Pty Ltd v Victoria, ^[23] Wilson J considered that the size of the impost there in question required "its rejection as a fee for services and its characterization as a tax" . And in Air Caledonie International v Commonwealth ^[24] it was said:

   

If the person required to pay the exaction is given no choice about whether or not he acquires the services and the amount of the exaction has no discernible relationship with the value of what is acquired, the circumstances may be such that the exaction is, at least to the extent that it exceeds that value, properly to be seen as a tax.

  136  Conversely, and as might be expected, the fact that a charge bears a close relationship with the cost or value of a service or the grant of a valuable right has been seen as indicating that it is not a tax. Thus, for example, in Harper v Victoria, where the legislation under consideration required that expenditure be estimated for grading eggs and fees fixed accordingly, it was held that the charge was not a tax, but a fee for services, as "the fee [was] exacted … to defray the cost of those services" . ^[25] Similarly, in Harper v Minister for Sea Fisheries, it was said that the most important factor in determining that the fee involved in that case (a fee for a licence to take abalone for commercial purposes) was not a tax was that it was "possible to discern a relationship between the amount paid and the value of the privilege conferred by the licence" . ^[26]

  137  In the course of argument, the respondents placed particular reliance on the decision of this court in Swift Australian Co (Pty) Ltd v Boyd Parkinson ^[27] and, also, on the decision of the Supreme Court of Canada in Re Eurig Estate. ^[28] In Boyd Parkinson a charge was levied "for the purpose of defraying the expenses of inspection of meat for sale and of carrying [the legislation authorising their imposition] into effect" . ^[29] Dixon CJ said that, perhaps, the latter consideration was "fatal to the argument" that the charge in question was a fee for service. ^[30]

  138  In Re Eurig Estate, probate fees which were calculated according to the value of an estate were held to constitute a tax rather than a fee for service because of the "absence of a nexus between the levy and the cost of the service" . That was so, it was held, by reason that "the cost of granting letters probate bears no relation to the value of [the] estate" . ^[31]

  139  The cases upon which the respondents rely involved circumstances quite different from the present. In particular, Boyd Parkinson was not concerned with a fee charged solely to defray the expenses associated with the services provided or to be provided. Nor, it is to be inferred, was Re Eurig Estate. Moreover, those cases were not concerned with the provision of services on a commercial basis. And although the service in question in Boyd Parkinson may have had some commercial value, it was provided as part of a regulatory scheme.

  140  The services in question in these appeals were services which clearly had a commercial value and were to be provided on a commercial basis. They were levied at a rate calculated to defray the cost of those services together, only, with a profit to cover future infrastructure requirements and to satisfy the Commonwealth ' s commercial expectations with respect to its capital investment. And although the Authority had regulatory functions, the services for which charges were exacted were provided commercially and not as part of a regulatory scheme.

  141  In a commercial context of the kind described, it seems to me that, notwithstanding that charges apply differently to different users and reflect neither the cost nor the value of the particular service rendered, they are properly characterised as fees for service if 3 conditions are met. The first is that they are levied only against persons who use the services. The second is that they are levied against all such users. The third is that there is a commercial justification for discriminating between different users.

  142  It is not in issue that only those who used or availed themselves of the services and facilities provided by the Authority were liable to pay the charges now in question and that all such users were liable to a charge for their use. Moreover, where services are provided by a public sector monopoly on a commercial basis, there is a sound reason for fixing prices according to price sensitivity or demand elasticity. Put at its simplest, if those who are price sensitive are forced out of the market, the cost to others will necessarily increase. That being so, the landing and en route charges are, in my view, properly to be characterised as fees for services and do not involve any element of taxation.

Liens: relevant legislative provisions

  143  Subject to s 76 , which is not presently relevant, s 69(1) of the CA Act 1988 relevantly allowed that if a charge payable in respect of an aircraft was not paid at the end of a payment period, the charge or penalty in respect of that charge remained unpaid and an appropriate officer directed the Registrar to make an entry in the Register, there was " vested in the Authority in respect of the aircraft a statutory lien covering the following:

 (d)  the charge or penalty;

 (e)  any penalty that becomes payable in respect of the charge after the entry is made;

 (f)  any further outstanding amounts in respect of the aircraft " .

  144  By s 72 , the Authority was empowered to seize any aircraft in respect of which any "outstanding amount covered by the statutory lien [was] unpaid at the end of 9 months after the day on which it became an outstanding amount or the day on which the lien was registered, whichever [was] the later" . And by s 73 , the Authority was given power to sell the aircraft. Section 70(2) provided that:

   

For the purposes of priorities amongst creditors and the purposes of the distribution of the proceeds of a sale made under s 73 , the statutory lien has effect as a security interest in respect of the aircraft ranking in priority:

 (a)  after any security interest (other than a floating charge) in respect of the aircraft created before the time of registration of the statutory lien, to the extent that that security interest covers a debt incurred before that time; and

 (b)  before any security interest not falling within, or to the extent that it does not fall within, paragraph (a). (Emphasis added.)

Statutory liens: s 51(xxxi) of the Constitution

  145  If valid, the effect of ss 69 and 70(2) of the CA Act 1988, the latter of which gave a lien "effect as a security interest in respect of [an] aircraft" , was to vest in the Authority an interest in property which it did not otherwise have. The question is whether, in its statutory context, s 69 is properly to be characterised as a law for "the acquisition of property" for the purposes of s 51(xxxi) of the Constitution.

  146  Section 51(xxxi) of the Constitution empowers the Commonwealth to make laws with respect to "the acquisition of property on just terms … for any purpose in respect of which the Parliament has power to make laws" . It is well settled that s 51(xxxi) operates as a guarantee of just terms ^[32] and, also, that it operates whether or not the acquisition is by the Commonwealth. ^[33]

  147  It is also well settled that the guarantee contained in s 51(xxxi) does not apply to a law that is not properly characterised as a law for the acquisition of property even though the law affects property interests. ^[34] Nor does it apply to a law of a kind that does not permit of just terms. ^[35] Moreover, it does not apply to a law which is supported by a head of legislative power that clearly authorises the acquisition of property otherwise than on just terms, ^[36] as, for example, the taxation power.

  148  The laws which stand apart from the guarantee in s 51(xxxi) of the Constitution do not constitute discrete categories of exception. Thus, for example, a law which is not properly characterised as a law for the acquisition of property because it is a law adjusting competing rights and interests may also be a law enacted under a head of power which clearly authorises the acquisition of property other than on just terms. ^[37] Whatever the precise relationship between the various categories of exception, however, a law under s 51 of the Constitution which operates to vest a person ' s property in another for a purpose for which the Commonwealth has power to make laws and which does not fall within one of those exceptions is a law to which the guarantee in s 51(xxxi) of the Constitution applies.

  149  In determining whether the liens provisions of the CA Act 1988 are laws which attract the guarantee of just terms in s 51(xxxi) of the Constitution, it is convenient to first consider by which heads of legislative power, s 51(xxxi) aside, they might be supported. The 2 most obvious are the power to legislate with respect to "trade and commerce with other countries, and among the States" (s 51(i) ) ^[38] and the power to legislate with respect to external affairs (s 51(xxix) ), ^[39] including, in relation to those powers, what is known as "the implied incidental power" . The only other relevant heads of power are s 122 , so far as concerns civil aviation in the Territories, and, possibly, the power to legislate with respect to "foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth" (s 51(xx) ).

  150  As already indicated, the taxation power is one that clearly authorises the acquisition of property and will thus support laws which are not subject to the guarantee effected by s 51(xxxi) of the Constitution. ^[40] So too is the power to legislate with respect to bankruptcy and insolvency (s 51(xvii) ) ^[41] and that with respect to "the acquisition, with the consent of a State, of any railways of the State on terms arranged between the Commonwealth and the State" . ^[42] And in Nintendo Co Ltd v Centronics Systems Pty Ltd it was held that the legislative power with respect to "copyrights, patents of inventions and designs, and trade marks" (s 51(xviii) ) clearly authorises laws which, "at their commencement, impact upon existing proprietary rights" . ^[43]

  151  The acquisition of property other than on just terms is not clearly authorised by the trade and commerce power. Nor is it clearly authorised either by the corporations power or by the external affairs power. ^[44] Accordingly, so far as the liens provisions might otherwise have been enacted under s 51 of the Constitution, they do not fall outside s 51(xxxi) on the basis that they are laws enacted under a head of power which clearly authorises the acquisition of property "unaccompanied by any quid pro quo of just terms" . ^[45]

  152  It is arguable that different considerations apply with respect to laws passed under s 122 of the Constitution. In Newcrest Mining (WA) Ltd v Commonwealth, ^[46] a law for the acquisition of property which was otherwise properly characterised as a law with respect to external affairs and, at the same time, a law pursuant to s 122 for the government of a Territory, was held to be subject to the guarantee effected by s 51(xxxi) . However, there was not a clear majority for the view that s 122 does not stand apart from s 51(xxxi) of the Constitution. ^[47] My own view is that it does not. ^[48] However, that question can be put to one side. There is no suggestion that the liens provisions in their operation in this case can be supported as laws under s 122 .

  153  Nor, in my view, can s 69 of the CA Act 1988, in its application to persons or corporations who or which did not incur debts or penalties giving rise to a lien, be said to stand apart from s 51(xxxi) on the basis that it is not properly characterised as a law for the acquisition of property. It is well settled that "a law which is not directed towards the acquisition of property as such but which is concerned with the adjustment of the competing rights, claims or obligations of persons in a particular relationship or area of activity is unlikely to be susceptible of legitimate characterization as a law with respect to the acquisition of property for the purposes of s 51 of the Constitution" . ^[49]

  154  So far as concerns aircraft owned by persons or corporations who or which have incurred charges and penalties giving rise to a statutory lien pursuant to s 69 of the CA Act 1988, the liens provisions are, in my view, properly to be characterised as laws adjusting the competing rights and claims of their existing and future creditors, rather than laws "directed towards the acquisition of property as such" . ^[50] However, that is not the case with persons or corporations who or which have not incurred the charges or penalties concerned.

  155  A person or corporation who or which did not incur penalties or charges giving rise to a lien cannot be said to be in a relevant relationship with anyone other than the person or corporation who or which, in the course of using the first mentioned person ' s or corporation ' s aircraft, incurred the charges or penalties involved. In this case, the relevant relationship was that of lessor and lessee, a relationship which, of itself, did not give rise to rights or obligations which might fairly be said to be in competition with the rights and obligations of others. True it is that there might, at some stage, also be a debtor and creditor relationship based in the lessor and lessee relationship and, although it is not necessary to decide the question, a law which postponed entitlement to recover moneys owing under the lease until charges or penalties owing to the Authority were paid would, in my view, be a law adjusting competing rights and claims and not one that is properly characterised as a law for the acquisition of property.

  156  Whatever might be the situation with respect to a law ordering priority between creditors, a law which operates to acquire a security interest in the property of a person to satisfy charges or penalties incurred by another is not, itself, adjusting competing claims or interests. At least that is so when there is no relationship between the former and the person or body to whom the charges or penalties are payable, as, for example, would be the case if the former had guaranteed payment of those charges or penalties. Absent a relationship of that kind, a law acquiring a security interest in the property of a person who did not incur the charges or penalties is not adjusting any interest of or claim by that person, or any obligation owed by him or her. It is simply appropriating a security interest in that person ' s property. The fact that, once appropriated, that interest may be utilised to adjust the competing claims and interests of creditors, of which that person may be one, cannot alter the fact that it is primarily a law for the acquisition of property and is properly characterised as such.

  157  It remains to be considered whether s 69 of the CA Act 1988 can be described, in its application to third parties, as a law which does not permit of just terms and which, thus, stands apart from s 51(xxxi) of the Constitution. Laws for the forfeiture of the property of enemy aliens ^[51] or property used in the contravention of the criminal law are laws of that kind. And in certain circumstances, the Parliament may legislate to effect a forfeiture of the property of a person who has not been involved, either directly or indirectly, in any contravention of the law. Thus, in Re Director of Public Prosecutions; Ex parte Lawler, ^[52] a law for the forfeiture of a vessel engaged in commercial fishing in the Australian fishing zone in contravention of a law of the Parliament was held to stand outside the guarantee effected by s 51(xxxi) of the Constitution notwithstanding that the owner was not in any way involved in that contravention.

  158  In Lawler, Deane J and I pointed out that a law for the forfeiture of property, even that of a person not involved in a contravention of the law, is a law "in connexion with which "just terms" is an inconsistent or incongruous notion" ^[53] and which, on that account, stands outside s 51(xxxi) . We pointed out, however, that "[a]lmost invariably, the validity of a law which effects or authorizes forfeiture of the property of ' an innocent third party ' … will depend on the law being reasonably incidental to the [legislative] power [pursuant to which the law in question was enacted]" . ^[54] We added that, in our view, a law of that kind would "not often satisfy the tests which reveal whether a law is reasonably incidental to a head of legislative power" . ^[55] I think it may be doubted whether, in their application to the property of persons who did not incur the charges or penalties giving rise to a lien, the liens provisions of the CA Act 1988 can properly be described as reasonably incidental to any of the heads of legislative power which otherwise supported the CA Act 1988. However, that question can be put to one side. Liens, even statutory liens, are not, in my view, inconsistent with the notion of "just terms."

  159  Leaving aside a maritime lien, which in some circumstances operates to affect the property interests of a person who did not incur the debt or obligation secured by it, a lien ordinarily comes into existence by reason that some service has been rendered to the person whose property is affected, ^[56] some advance has been made to him or her, ^[57] or, at his or her request, ^[58] or goods have been sold to him or her and the purchase price not paid. Ordinarily, the lien is the just quid pro quo for what has been provided to the person whose property is affected. At the very least, it contemplates a transaction which directly benefits the person whose property is affected. In that sense, there is no inconsistency between the notion of just terms and the imposition of a statutory lien.

  160  Absent any direct benefit to the person whose property is affected, however, a lien simply effects an acquisition of property. The guarantee effected by s 51(xxxi) would be rendered nugatory if Parliament could legislate pursuant to some other head of legislative power to impose a lien where there is no direct benefit to the person whose property is affected.

  161  Before leaving this matter, it is convenient to refer to maritime liens, with which the liens provisions of the CA Act 1988 bear some similarity. As with the liens provisions of the CA Act 1988, a maritime lien may operate to affect the interests of a person other than the person who incurred the debt or obligation secured by it. It may be that, given the long history of maritime liens, a law imposing a new maritime lien, so far as it affects the property interests of persons who did not incur any debt or obligation, could properly be characterised as a law of the kind that does not permit of just terms. If so, that is because of the history of maritime liens - a history which predates the Constitution. In my view, the guarantee of just terms effected by s 51(xxxi) negates the possibility of the creation of statutory liens affecting the property of third parties in any other context.

  162  The appeals should be dismissed.