Commonwealth v Bogle
89 CLR 229(Decision by: Williams J) Court:
Judges:
Dixon CJ
McTiernan J
Williams JWebb J
Fullagar J
Kitto J
Taylor J
Judgment date: 13 March 1953
Decision by:
Williams J
In these three cases I am of opinion that the questions asked in the cases stated should be answered as follows. In Bogle's Case: 1. (a) and (b): No; 2. and 3.: Do not arise; 4. No; 5. No; 6. The Commonwealth of Australia; 7. Does not arise. In Clark's Case: 1. (a) and (b): No; 2. and 3.: Do not arise; 4. No; 5. The Commonwealth of Australia; 6. Does not arise. In Boreham's Case: 1. (a) and (b): No; 2. and 3. Do not arise; 4. No; 5. The Commonwealth of Australia; 6. Does not arise.
I do not propose to give reasons at length for reaching these conclusions. There are two plaintiffs, the Commonwealth of Australia and Commonwealth Hostels Ltd The company was incorporated on 13th September 1951 under the provisions of the Companies Act 1938 (Vict.). It is a company not for profit limited by guarantee having seven members all of whom are civil servants of the Commonwealth and all of whom undertake to contribute to the assets of the company in the event of it being wound up etc such amounts not exceeding PD1 as may be required for payment of the debts and liabilities of the company etc Its principal object is to provide, acquire, take over, establish, equip, maintain, conduct, control, manage or supervise hostels in Australia for the accommodation of migrants; members of the defence forces of the Commonwealth and their dependants; persons in the service of the Commonwealth of Australia or any authority under the Commonwealth and their dependants; persons engaged upon work for the Commonwealth of Australia or any authority under the Commonwealth or their dependants for whom the Minister of State for Labour and National Service requests the company to provide accommodation. Clause 6 of the memorandum of association provides that if upon the winding up or the dissolution of the company there remains after the satisfaction of all its debts and liabilities any property whatsoever, the sum shall not be paid to or distributed amongst the members of the company, but shall be paid or transferred to the Minister of State for Labour and National Service and shall be applied in such manner as he may direct. The articles of association of the company provide that its directors shall be appointed by the Minister and that the office of director shall be vacated if the director is required by the Minister to resign. Article 59 provides that the company shall take steps to wind up its affairs as soon as practicable after receiving a written notice from the Minister that in his opinion such a course is in the circumstances necessary or desirable.
On 20th November 1951 an agreement in writing was entered into between the Commonwealth and the company and it is under this agreement that the company is managing and conducting the hostels referred to in the suits. One of these hostels is situated in New South Wales, one in Victoria and one in South Australia. It is an agreement to manage and control such of the hostels as are from time to time specified by the Minister. There is no transfer of title of the hostels from the Commonwealth to the company, they remain the property of the Commonwealth as heretofore. Clause 9 of the agreement expressly provides that nothing therein contained shall be deemed to confer on the company any right title or interest in any of the real or personal property of the Commonwealth comprised in the hostels. Clause 2 of the contract provides that the Commonwealth will make available by way of loan to the company upon such terms and conditions as may be determined by the Minister such funds as are appropriated by Parliament for this purpose. Clause 7 provides that the company will at all times observe and comply with any directions given by the Minister relating to the policy to be adopted by the company in carrying out its undertaking as to the management and control of the hostels. The agreement contains a number of other provisions intended to give the Minister complete control of the manner in which the hostels are to be managed and conducted. It is unnecessary to refer to all of them. There is an undertaking by the company not to alter the scale of charges from time to time approved by the Minister for the accommodation and facilities provided in the hostels. Another undertaking is to proceed to close down any hostel under the management or control of the company as soon as is reasonably practicable after being so requested in writing by the Minister.
The principal object of the company, its Constitution as a whole, and the provisions for its internal management clearly indicate to my mind that the company was created by the Commonwealth so that it would have a convenient corporate agent for carrying out a governmental purpose of the Commonwealth where it is incidental to such a purpose to provide hostels, housing and other forms of accommodation for migrants and the other persons referred to in the principal object. The terms and conditions of the agreement of 20th November 1951 prove that the company is in fact managing and conducting the hostels in execution of the first of these governmental purposes as the mere agent of the Commonwealth. It is managing and conducting on behalf of the Commonwealth a certain activity in which the Commonwealth considers it necessary to engage as incidental to its national purpose of promoting and assisting immigration into Australia. This activity is providing board and lodging for immigrants when they first land in Australia pending their absorption into the community. For this purpose the Commonwealth has acquired a large number of hostels and the Commonwealth Parliament has voted the large sums of money in the Appropriation Acts to which we were referred. In Skinner v Commissioner for Railways [F1] , at p. 109 Jordan C.J. has summed up with his usual lucidity the considerations which determine whether a body represents the Crown for the purpose of being entitled to the benefit of the Crown's prerogatives, privileges and immunities including that of not being bound by statutes unless an intention in that behalf appears either expressly or by necessary implication. If the body is really an agent of the Crown it is immaterial, as his Honour pointed out, that it is incorporated or that it can sue or be sued or is carrying on trading activities. Later cases are collected in Bank of New South Wales v The Commonwealth [F2] , at p. 273.
The extent to which the Crown in right of the Commonwealth can be bound by State legislation is a subject upon which there has been a difference of opinion in this Court: In re Richard Foreman & Sons Pty Ltd ; Uther v Federal Commissioner of Taxation [F3] . In Minister for Works (W.A.) v Gulson [F4] there was also a difference of opinion whether the immunity under discussion only applies, in the case of Commonwealth legislation, to the Crown as sovereign head of the Commonwealth, and in the case of State legislation to the Crown as sovereign head of the State. For the reasons given in Gulson's Case [F5] I am of opinion that whenever it is intended that Her Majesty shall be bound in respect of her prerogative, rights or property, whether as the sovereign head of the United Kingdom or any part of the British Commonwealth, or of the Commonwealth of Australia, or any State it is necessary that she shall be expressly named or that a necessary implication to that effect shall appear from the purpose and provisions of the statute. Accordingly, since the company is an agent of the Commonwealth, it cannot be subject to the provisions of the various State Acts relied upon unless these Acts bind the Crown expressly or by necessary implication. The Acts in question are the Landlord and Tenant Acts passed in New South Wales, Victoria and South Australia in 1948 and the Prices Regulation Acts of those States passed in the same year. In the end, the defendants did not, if I understood the argument correctly, claim that they were tenants and entitled to rely on the Landlord and Tenant Acts. If they had attempted to do so the attempt must have failed because these Acts expressly exempt the Crown in right of the Commonwealth. But the defendants did claim that they were being provided with board and lodging by the company and entitled to rely on the Prices Regulation Acts and particularly the provisions of those Acts relating to declared services. The New South Wales and Victorian Acts do not bind the Crown expressly and there is nothing to be gathered from their purpose or provisions to raise a necessary implication. The South Australian Act provides that service means the supply for reward of water, electricity, gas, transport, or other rights, privileges or services (not being services rendered by a servant to a master) by any person (including the Crown and any statutory authority) engaged in an industrial, commercial, business, profit-making or remunerative undertaking, or enterprise. This definition refers to the Crown but, when it is read as a whole, it would seem that the Crown is intended to mean the Crown in right of the State of South Australia a meaning which accords with that placed upon the Crown in Essendon Corporation v Criterion Theatres Ltd [F6] .
It was submitted for the defendants that, even if the company was an agent of the Commonwealth, it had nevertheless contracted with the inmates of the hostels as a principal and that the Commonwealth could not come in and claim the benefit of the contract without becoming subject to the principle that where A employs B to make a contract for him and B makes a contract with C, if B is a person who might reasonably be supposed to be acting as a principal and is not known or suspected by C to be acting as the agent of anyone, A cannot make a demand against C without the latter being entitled to stand in the same position as if B had in fact been a principal Montagu v Forwood [F7] ; Isaac Cooke & Sons v Eshelby [F8] ). It was submitted that if the company sued the defendants, they would be able to plead the Prices Regulation Acts and that the Commonwealth as an undisclosed principal could not be in a better position. In my opinion this principle cannot be invoked to whittle away the immunity of the Crown. A person who is a mere agent of the Crown is entitled to the same shield as the Crown itself, and the company as such agent is as much immune from the provisions of these Acts as the Crown itself (Roberts v Ahern [F9] ; Tyne Improvement Commissioners v Armement Anversois S/A (The Brabo) [F10] ).