Spencer
vCommonwealth of Australia

Judges: French CJ
Gummow J
Hayne J

Heydon JCrennan J
Kiefel J
Bell J

Judgment by:
Heydon J

61. On 28 August 2008, when Emmett J dismissed the applicant's proceedings, Pye v Renshaw ^[83] was thought to be an obstacle to their success. The same position applied on 24 March 2009, when the Full Court of the Federal Court of Australia dismissed an appeal against the orders of Emmett J. But on 9 December 2009, ICM Agriculture Pty Ltd v The Commonwealth ^[84] was decided. A majority of this Court concluded that, notwithstanding Pye v Renshaw , the legislative power of the Commonwealth conferred by s 96 and s 51(xxxvi) of the Constitution does not extend to the grant of financial assistance to a State on terms and conditions requiring the State to acquire property on other than just terms ^[85] . Further, three members of the Court placed a question mark over the validity of legislation relating to an "informal arrangement" providing for Commonwealth funding to a State if it acquires property on unjust terms ^[86] . The applicant has pleaded facts which might attract a conclusion favourable to him if that question is answered against validity. Discovery of documents might assist him to establish those pleaded facts.

62. Emmett J acted pursuant to s 31A(2) of the Federal Court of Australia Act 1976 (Cth). Whatever the construction of that provision, it is clear that had the courts below been aware - which obviously they could not have been - of what was to be said in ICM Agriculture Pty Ltd v The Commonwealth , they would not have viewed an order under s 31A(2) dismissing proceedings as appropriate. That is a sufficient reason for making order 1, order 2 and order 3(a) and (b)(i) of the orders which the other members of the Court wish to make. Contrary to the opinion of other Justices, it is not necessary to consider the correct approach to s 31A. If it were, it would also be necessary to hear submissions from the parties on the subject. Apart from some remarks at the end of the applicant's oral reply on the subject of whether a s 31A order was interlocutory, and two tentative sentences about the width of the power conferred by s 31A, the parties have not advanced any submissions about it. It is therefore both unnecessary and undesirable to say anything on that subject.

63. I also favour order 3(b)(ii) of the orders favoured by other members of the Court for the following reasons. That is the order which would normally be made, unless there were some reason for an order less generous from the applicant's point of view. In this Court the applicant has consistently sought that order - in his draft Notice of Appeal, in his revised draft Notice of Appeal, in his written submissions, and in his oral reply. The respondent has consistently contended that the application for special leave should be refused with costs, or, if the special leave application were granted, that the appeal should be dismissed with costs. The respondent never addressed the question of what costs order in relation to the Notice of Motion of 26 July 2007 should be made in the event, which has now come to pass, that special leave is granted and the appeal allowed.