Abstract
The article analyses legal materials concerning the legal personality of the Commonwealth of Australia under domestic law. It argues that the Commonwealth as legal person has an existence, as a unit of the legal system, which is conceptually distinct from the Commonwealth of Australia as a nation, and the Commonwealth as federal government of that nation. Current idioms (eg ‘polity’ and ‘body politic’) have a tendency to confuse these distinctions. The article suggests, as a more appropriate way to denote the Commonwealth as legal person, the term ‘constitutional person’.
[I]t depends on the legal institutions and forms of every commonwealth whether and how far the State or its titular head is officially treated as an artificial person.
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Introduction
While there can be no doubt that the Commonwealth is a legal person, 2 the nature and extent of its personality have not previously been the subject of sustained analysis. This article explores cases and literature bearing upon that question and suggests a number of conclusions.
A fundamental difficulty obscuring analysis of this topic is the absence of a settled vocabulary. The Commonwealth of Australia is the name of a legal person operating within the domestic legal system. Amongst other meanings, the Commonwealth of Australia is also the name of a nation and the central government of that nation. Is it sensible to speak of the ‘nation’, or the ‘government’, as a legal person? As Dixon J said (in a related context) in the Melbourne Corporation Case: So far I have stated my opinion in an abstract and general form and in this there is no little danger. For the subject has no vocabulary of technical terms possessing a precise and settled connotation and the use of expressions of indefinite and variable meaning is unavoidable.
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The Commonwealth of Australia, as legal person, is conceptually distinct from the ‘nation’ and the ‘government’. The Commonwealth is a separate legal entity, one of the ‘basic units’ of the legal system that ‘possess the capacity of being parties to the claim-duty and power-liability relationships’. 5 The source of the Commonwealth’s legal personality is the Constitution. That has important doctrinal and conceptual consequences (discussed further below), and this article uses the term ‘constitutional person’ as a shorthand to denote the Commonwealth of Australia as a legal person operating within the domestic legal system, which is conceptually distinct from the nation and the government.
The constitutional person achieves an important function, which is to have an entity (able to be controlled or directed by the Executive Government, operating within its constitutional boundaries) that represents the people of Australia — ie holds lands, funds, liabilities and capacities of various kinds on behalf of the people of Australia. But it is a mistake to infer from this that the Commonwealth’s legal personality must be arrogated, or attributed in some way, to the ‘nation’ or the ‘government’. The established legal attributes of the ‘nation’ and ‘government’ make it inappropriate that they be ascribed legal personality within the domestic legal system. In short, it is inappropriate to elide these distinct concepts (constitutional person, nation and government). Neither the ‘nation’ nor the ‘government’ has legal personality. The constitutional person is not equivalent to the ‘state’ in the broad sense, which is not and never has been treated as a legal person.
The proper theorisation of the Commonwealth’s legal personality is of practical and doctrinal importance. Practically, the constitutional person is a very significant property owner, employer and contractor. An appreciation of the scope and extent of its legal personality can assist (for example) in determining which entity to sue and for the actions or mental states of which individuals or ‘groups’ it will be liable. The Commonwealth as legal person also plays an important role in the design of the constitutional system. As Gageler J explained in M68, 6 behind Chapter II of the Constitution, and embedded in Chapter III, is a personalised and ‘peculiarly functionalised Australian conception of “the Government”’. 7 That conception is under-theorised, to date, but is an important element of the architecture of constitutional government in Australia. It has and will continue to have important doctrinal consequences. Three examples illustrate this. The first is Williams (No 1), where there was debate about the extent to which the legal personality of the Commonwealth informs the executive power conferred by s 61 of the Constitution. The second is the Plain Packaging Case, where there was debate about what it means to say that the ‘Commonwealth’ must have received a ‘benefit’ for the purpose of the guarantee of just terms in s 51(xxxi) of the Constitution. 8 The third is the enactment of s 10(2) of the Workplace Health and Safety Act 2011 (Cth), which contemplates criminal charges being laid against the Commonwealth 9 — something that Sir Owen Dixon once described as being ‘opposed to all our conceptions, constitutional, legal and historical’. 10
After defining the concept of ‘legal personality’, this article will examine the uses and judicial treatment of the term ‘Commonwealth’ in the Constitution, with particular emphasis on contexts showing that something called the ‘Commonwealth’ has capacity to be in legal relationships and on contexts exposing the conceptual distinctions between the constitutional person, nation and government (‘The “Commonwealth” in the Constitution’ and ‘Legal personality and the Constitution’ sections). These sections also explore the reasons for the demise of the ‘Crown’ as the organising concept for governmental legal personality. The ‘Williams v Commonwealth’ section then examines the judgments in Williams (No 1), which is both the most recent and the most detailed consideration by the High Court of the Commonwealth’s legal personality. The article then explores the current notions that the Commonwealth is a ‘body politic’ or ‘polity’ that has legal personality or is a legal person (‘Competing theories’section). These terms are highly ambiguous in meaning, and are being used inconsistently, in a way that masks what may be a profound divergence in the way that that the Commonwealth as legal person is conceptualised. It is suggested that, if a need be felt to describe the Commonwealth as legal person in an abstract or compendious way, a more appropriate term is ‘constitutional person’.
Legal Personality
Under Australian law, a legal person is an entity with ‘capacity’ to be in a legal relationship. 11 ‘Capacity’ assumes the ability to have legal relations with other legal persons and describes the ability to create, modify or terminate legal relations. 12 Human beings are legal persons from birth until death 13 but have diminished capacities during the age of minority. 14 Adult human beings have relevantly unlimited capacity to form legal relations, whereas corporations have the benefit of s 124(1) of the Corporations Act 2001 (Cth), which gives them ‘the legal capacity and powers of an individual’.
‘Capacity’ is an important concept in relation to governmental legal personality. It denotes the ability of the constitutional person (acting by or through officers of the Executive Government) to do things, or exercise faculties, common to all legal persons, taking effect under the condition of the general law, and which do not (at least directly) alter or change the legal rights or juridical relations of others. 15 The Commonwealth has been held to have capacity, for example, to exercise a right of payment, 16 to hold a right in respect of real property, 17 to accept a gift 18 and to contract. 19 As will be shown below, the Constitution itself assumes that the Commonwealth has ‘capacity’.
Historically, legal persons were either human beings or corporations. 20 It has long been established that the legislature is free to create any legal person that it desires, with any capacities that it thinks fit. 21 A statute that assumes that an entity or group has ‘capacity’ will have created a separate legal person, independent of the human beings comprising it. 22 That is so regardless of what the legislature may choose to call, or declare about, the group it has so created. An interesting illustration of this is the recent decision in Queensland Rail. By the Queensland Rail Transit Authority Act 2013 (Qld), the legislature endowed the Queensland Rail Transit Authority with capacities and thus made it a legal person. In an effort inter alia to avoid the application of industrial relations legislation, the Act declared that the Authority was ‘not a body corporate’ (s 6(2)). The High Court held, despite this statutory declaration, that the Authority had the ‘full character of a corporation’ and ‘must be found to be a trading corporation’. 23 As Gageler J put it, the Authority answers the constitutional description of a corporation ‘because it is an entity established by law with capacity to own property, to contract and to sue’; and the statutory declaration was ‘ineffective’ to displace that conclusion. 24
Queensland Rail also reinforces the traditional understanding that legal personality is unitary. 25 In other words, an entity either is or is not a legal person — the status is binary. In Williams v Hursey, Fullagar J rejected a submission that a statute conferring legal personality upon a trade union ‘for the purposes of the Act’ 26 had, to that extent, qualified the trade union’s legal personality — ie made it a legal person for ‘the purposes of the Act’ but not for other purposes. In a frequently cited passage, 27 Fullagar J said that the ‘notion of qualified legal capacity is intelligible, but the notion of qualified legal personality is not’. 28 This again reflects the essentially functional definition of legal personality: the concept is defined by reference to what it achieves, namely an anchor for rights/duties/liabilities etc, not by reference to any inherent qualities that might be said to be uniform to legal persons. Thus, Maitland described legal persons as ‘right-and-duty-bearing units’. 29 If the legal system is to be understood as a web of mutual and correlative legal relationships, then the system is predicated upon the existence of ‘units’ that are able to own rights, attract liabilities, owe duties etc.
The functional, binary quality of legal personality is fundamentally important for theories of governmental legal personality, because of the tendency to correlate the legal person with other concepts (ie the ‘nation’ or ‘government’) operating at much higher levels of intellectual abstraction. As will emerge below, the only way to reconcile such notions with other doctrines operating upon the ‘nation’ or ‘government’ is to postulate that the Commonwealth is a legal person for some purposes but not for others. That, however, is contrary to the functional, binary character of legal personality. It is legally more coherent, and historically more consonant, to accept that the proposition, that the Commonwealth is a legal person, establishes only the existence of a unit within the legal system (called the ‘Commonwealth’), in respect of which capacities have been constitutionally conferred and legally recognised. 30
The Commonwealth is, of course, a non-human legal person — a persona ficta. To adapt a memorable phrase, it cannot ‘eat or drink, or wear clothing, or live in houses’. 31 Like a company, its ‘existence, capacities and activities are only such as the law attributes to it’. 32 The acts, omissions and states of mind attributed to the Commonwealth will inevitably be the acts and omissions of human beings, 33 usually the human beings comprising the Executive Government of the Commonwealth. 34 In this sense, to adopt Professor Sawer’s phrase, the Executive provides ‘most of the “substratum” for government as person’. 35 If the Commonwealth has sworn an affidavit, it will have done so through an authorised officer forming part of the Executive Government. 36 If it has decided to issue a notice to quit, 37 or to erect a fence, 38 or to build a telecommunications tower 39 on or in respect of land that it owns, that will be because officers forming part of the Executive Government have made these decisions. 40 If individuals forming part of the Executive Government act unlawfully, then it is the Commonwealth (not the Executive Government of the Commonwealth as a separate legal person) that is held liable. These examples illustrate what Sawer meant by ‘sub-stratum’: whenever the process of government throws up a need for a constitutional person, it is through the human beings comprising the Executive Government that the constitutional person acts.
Rules of attribution have proceeded, in the case of governments, by analogy with corporate agency theory. The principles governing the authority of human beings comprising the Executive Government to bind the Commonwealth to contracts, ably treated in the leading textbooks,
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can be understood as requiring the existence of a relationship of ‘constitutional agency’ between the individuals and the Commonwealth. As it was put in Attorney-General v Lindegren: The Government itself cannot make such contracts as these but through the medium of the Navy Board, and they are for such purposes a competent ministerial body — the constitutional agents of the public; and they are capable as such of binding the Government.
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Likewise, the attribution of mental states to the government has proceeded by analogy with corporate agency theory. An early example is HMS Truculent, where Willmer J thought that there was an analogy between the Board of Admiralty and the Board of Directors of a limited company: ‘[j]ust as a limited company acts and transacts its business through its board of directors, so His Majesty, in relation to His Majesty’s ships, acts through the Board of Admiralty’.
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In Western Australia v Watson,
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the Full Court of the Supreme Court of Western Australia applied that analogy to the Cabinet or the Executive Council of the State for the purposes of attributing knowledge of one government department to the State. Their Honours said: If one applies the corporate analogy to the Government or the State, it follows that the knowledge of any Minister of the Crown acquired by him in that capacity will be regarded as knowledge of the Government as a whole and, therefore, of the State.
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The ‘Commonwealth’ in the Constitution
This section shows that the ‘Commonwealth’ means different things in the Constitution. 55 So much is uncontroversial: the High Court has acknowledged that the term ‘Commonwealth’ is used in different ways in the text. 56 The Constitution uses the term to denote, at least, the nation known as the Commonwealth of Australia (hereafter ‘Commonwealth (nation)’) and the central government of the Federation (hereafter ‘Commonwealth (government)’). This section explores the case law on those concepts so that, in subsequent sections, their significance for the correct theorisation of the legal personality of the Commonwealth can be exposed.
The Commonwealth (nation) is ‘the community united as a nation’, 57 which has international legal personality. 58 This is a composite conception, comprising the territorial land mass, a ‘government’ (recognised internationally), the people, and the component States and Territories. All are bound together or united, in an ‘indissoluble Federal Commonwealth’, 59 by core rules established by the Constitution, such as responsible government, 60 federalism and the separation of powers. 61
The term ‘nation’ has a fluidity and ambiguity of meaning. 62 In Davis v Commonwealth, Brennan J said that the ‘reality of the Australian nation is manifest, though the manifestations of its existence cannot be limited by definition’. 63 There may be different ways of understanding the Commonwealth (nation), but what is important for present purposes is that a (perhaps the) prominent view conceives of the Commonwealth (nation) as subsuming or embracing the people, the government and the States. Thus, in Thomas v Mowbray, Gummow and Crennan JJ said that ‘governments’ and ‘the public’ were ‘elements of the body politic’ and held (rejecting a submission to the contrary) that the ‘notion of a “body politic” cannot sensibly be treated apart from those who are bound together by that body politic’. 64
The Commonwealth (government) is the central government of the Federation (which is a component of the Commonwealth (nation)). The word ‘government’, which is not a term of art, 65 ordinarily signifies: first, the ‘totality of continuing institutional machinery, incorporating all the varying offices and roles’ of government; 66 and, second, more narrowly, the ‘executive as distinct from the legislative branch of government, represented by the Ministry and the administrative bureaucracy’. 67 Government in the first sense captures all of the branches: legislative, executive and judicial. It means the ‘organized form of government which the fundamental rules of law have established’. 68 To avoid confusion, the expression ‘Executive Government’ should be used to denote government in the second sense. The term ‘governmental power’ corresponds to the first sense of the word and signifies the ‘whole power of a community’. 69 For present purposes, the vital characteristic of the Commonwealth (government), which distinguishes it from the Commonwealth (nation), is that government is distinct from the people who are governed, and the Commonwealth (government) does not embrace the States (who have separate governments).
These definitions and concepts are of great significance to the proper theoretical understanding of the Commonwealth as legal person. Before developing this further, it is first necessary to examine how and in what ways the Constitution itself treats the Commonwealth as a legal person and to identify how those provisions of the Constitution have historically been understood.
Legal Personality and the Constitution
The ‘Commonwealth’ is not defined in the text of the Constitution, which takes as its central concern the governing organisation of the government of Australia. 70 The traditional language of incorporation was not deployed by the framers. 71 Nevertheless, a number of provisions of the Constitution imply that the ‘Commonwealth’ has capacity. For example, the Commonwealth is treated as having capacity to owe a debt and be indemnified (s 105), to receive transfers of and own property (ss 85 and 114) and to be a party to litigation in its own name (s 75(iii)). These provisions assume that the Commonwealth is a legal person.
There have been significant changes, in the history of the High Court, in the way that this legal person has been understood. At the time the Constitution was drafted, governmental legal personality was thought to be expressed through the personality of the Sovereign, which came to be symbolised in the expression ‘the Crown’. Professor Frederic Maitland explored this concept in a series of highly influential articles, published after 1900. 72 Maitland pilloried Coke’s idea that the King was a ‘corporation sole’, 73 arguing instead that English law had come to treat the Sovereign as the ‘head of a complex and highly organised “corporation aggregate of many”’. 74 In Australia, Maitland’s writings were taken up by Professor W Harrison Moore, who wrote four articles on the topic between 1904 and 1907. 75 Harrison Moore pointed out the difficulties of deriving legal personality from the ‘Crown’ in a federal system, focussing on the doctrine of Crown unity and indivisibility. The difficulty, as Harrison Moore and others 76 pointed out, was that multiple governments would, of necessity, simultaneously engage the legal personality of the Sovereign. The High Court had initially held that the ‘Crown’ was ‘to be regarded not as one but as several’ legal persons, ‘representing’ the Commonwealth and States as ‘distinct and separate sovereign bodies’ 77 (the theory was later mocked as ‘the heresy of Crown schizophrenia’). 78
In 1920, however, a differently constituted Court held in the Engineers’ Case that distinctions between the ‘Commonwealth King’ and the ‘State King’ (as those juristic persons came to be called) overlooked the ‘elementary’ proposition that the ‘Crown’ was unified and indivisible throughout the Empire. 79 The Court emphasised that the term ‘Commonwealth’ comprehended ‘both the strictly legal conception of the King in right of a designated territory, and the people of that territory considered as a political organism’. 80 Thereafter, until the 1990s, the expression ‘Commonwealth’ (when applied to a legal person) was understood as a compendious expression for ‘the Crown’ or the ‘Crown in right of the Commonwealth’.
Confidence in the doctrine of Crown unity and indivisibility gradually eroded in the decades following the Engineers’ Case. In 1928, Sir John Latham wrote that the King ‘should not be regarded as having several juristic existences’ and cited the Engineers’ Case as authority for the proposition that it was a ‘primary legal axiom that the Crown is ubiquitous and indivisible in the King’s dominions’. 81 In 1944, however, Latham CJ described the notion as ‘verbally impressive mysticism’ when ‘stated as a legal principle’. 82 It is difficult to speculate at the causes of the shift, though scholars have pointed (in related contexts) to the Balfour Declaration, resulting from the Imperial Conference of 1926, and the enactment of the Statute of Westminster 1931 (UK). 83 By 1988, at least, the High Court had completely dispensed with the notion of Crown unity and indivisibility. 84
In modern times, the High Court of Australia has rejected the device of ‘Crown in right of the Commonwealth’ to designate the Commonwealth’s legal personhood. That has been done in reliance on certain cases interpreting the use of the word ‘Commonwealth’ in the Constitution, in particular ss 75 and 114, 85 as well as in connection with aspects of the royal prerogative. 86 These decisions provide a source of guidance as to the nature of the Commonwealth’s legal personality.
Section 75(iii) grants the High Court original jurisdiction in ‘all matters’ in which ‘the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party’. There was argument in the Bank Nationalisation Case as to the ambit of this expression. Recently, judgments dealing with or touching upon the legal personality of government have seen fit to rely upon a passage in the judgment of Dixon J in the Bank Nationalisation Case,
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which is regarded as having propounded a ‘constitutional conception’
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of the Commonwealth. Dixon J said: The ‘Commonwealth’ means the central Government of the country. The Constitution sweeps aside the difficulties which might be thought to arise in a federation from the traditional distinction between, on the one hand the position of the Sovereign as the representative of the State in a monarchy, and the other hand the State as a legal person in other forms of government…and goes directly to the conceptions of ordinary life. From beginning to end it treats the Commonwealth and the States as organizations or institutions of government possessing distinct individualities.
It is obvious that ‘government’, in the broad sense, is comprised of a multitude of distinct legal persons. Statutory corporations, for example, are often constituted for the very purpose of performing, in the public interest, public or governmental functions and to that extent are indisputably part of the ‘government’. Yet, as separate legal persons, governmental statutory corporations can sue each other, 92 and at the federal level will have a legal existence distinct from the Commonwealth (legal person). In Launceston Corporation v The Hydro-Electric Commission, the High Court had held that the occupation of land by a statutory corporation was not ‘occupation on behalf of Her Majesty or for the purposes of Her Majesty’. 93 As Allsop P said in a recent case, the status of statutory corporations, as ‘representing’ the ‘Crown’, does not deny their ‘separateness as a corporate personality’. 94 In a 2003 case, 95 the New South Wales Court of Appeal held that the knowledge of a responsible Minister could not be attributed to the Electricity Commission, a body corporate established by statute to perform public services. 96 Merely because the Electricity Commission might represent the ‘Crown’, for some purposes, ‘did not render the Electricity Commission the representative of the Crown for all purposes and did not deem it to be the Crown’. 97 Thus, the Commonwealth ‘government’ in the broad sense is comprised of a multitude of legal persons, including the constitutional person. All are within the jurisdiction of the High Court under s 75(iii). But self-evidently they have different legal personalities. The Commonwealth (constitutional person) is not to be treated as having incorporated every dimension of the government or the Executive Government. Section 75(iii) (and s 114) are in fact premised upon a distinction between the Commonwealth (constitutional person) and the Commonwealth (government).
Section 114 of the Constitution prohibits the States and the Commonwealth from imposing any tax on one another’s property. ‘There can be no doubt’, said the Court in Deputy Commissioner of Taxation v State Bank of New South Wales,
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that s 114 refers ‘to the Once it is accepted that the Constitution refers to the Commonwealth and the States as organisations or institutions of government in accordance with the conceptions of ordinary life, it must follow that these references are wide enough to denote a corporation which is an agency or instrumentality of the Commonwealth or a State as the case may be.
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Section 114 was then considered in the State Superannuation Case, 101 which concerned the liability of the State Authorities Superannuation Board to pay stamp duty on an agreement to purchase real property in Perth. In a separate judgment, McHugh and Gummow JJ said that the meaning of the term ‘State’, as it appeared in ss 75 and 114 of the Constitution, was not governed by equivalence with the ‘Crown’ nor by entitlement to the privileges, immunities or the ‘shield of the Crown’. 102 Their Honours said that the ‘mysticism’ 103 of the doctrine of Crown unity could not assist ‘today in dealing with the mutual legal relationships between the Australian States’. 104 The doctrine was now politically unimportant and insignificant. Moreover, it was inconsistent with the text of the Constitution: ‘to speak of the Crown in right of the Commonwealth is to give inadequate recognition to the structure of the Constitution’. 105
These ideas were then developed in the joint judgment of Gummow and Kirby JJ in Mewett, 106 which raised for decision the legal basis of the Commonwealth’s liability in tort. The Commonwealth argued that the plaintiffs’ rights to proceed, against what was called ‘the Commonwealth Crown’, were based upon the Judiciary Act 1903 (Cth). 107 The causes of action could not have been based upon general law, because at common law the ‘Crown in right of the Commonwealth’ had the benefit of the Sovereign’s immunity from liability in tort. The respondents argued that the Commonwealth’s common law immunity from suit in contract and tort had been removed by s 75(iii) of the Constitution, 108 so that the right to proceed against ‘the Commonwealth Crown’ was derived from general law. The latter submission was accepted by a majority of the Court. 109 Echoing what was said by Gummow and McHugh JJ in the State Superannuation Case, Gummow and Kirby JJ concentrated on the vocabulary and syntactical structure of the Constitution (especially s 75), which did not identify ‘the Crown in any particular capacity’. 110 The textual use of the noun ‘the Commonwealth’ is thus given great significance. The ‘Commonwealth’ is made to be the subject and object of constitutional sentences dealing with rights and duties. It is textually conceived as a ‘politically organised body’. 111 This ‘new state of affairs’, their Honours said after paraphrasing Dixon J in the Bank Nationalisation Case, ‘required adjustment to habits of thought formed in a common law system with a unitary structure of government’. 112 Further, the concept of a ‘matter’ in Chapter III, read with other sections of the Constitution, encompasses species of justiciable controversy unknowable in the UK. 113 These classes of controversy meant that the immunity doctrine, as it had been developed in the UK, 114 was inconsistent with Chapter III of the Constitution.
The textual basis for rejecting the ‘Crown’ was further elaborated by Gummow J in the Mining Act Case. 115 His Honour observed that the term ‘Crown’ had come to be used in various senses, 116 but most of those senses were not deployed in the Constitution. The Constitution contemplated dealings between or involving ‘the Commonwealth’ and the ‘Parliament of a State’, for example in s 111 in Chapter V and ss 123 and 124 in Chapter VI. It distinguished those dealings from others between or involving ‘the Commonwealth’ and the ‘Executive Government’ of a State, for example, in s 119. Other provisions, such as ss 85 and 51(xxxi), spoke of the vesting in or acquisition by ‘the Commonwealth’ of the property of ‘a State’ or ‘any State’. These provisions did not operate by reference to distinctions drawn between the ‘Crown’ in various capacities. 117
The next case in the sequence was Sue v Hill. 118 Section 44 of the Constitution, which has recently generated much litigation and political controversy, renders ineligible for election to the Commonwealth Parliament any person who (inter alia) is a citizen of a ‘foreign power’. The question in Sue v Hill was whether the United Kingdom was a ‘foreign power’. The joint judgment of Gleeson CJ, Gummow and Hayne JJ, following the judgment of Gummow J in the Mining Act Case, 119 took the opportunity to re-emphasise that the Constitution did not use the term the ‘Crown’ to describe the Commonwealth. 120 In the past, lawyers had pressed the ‘Crown’ into service to distinguish between the ‘newly created and evolving political units’. 121 That had been done by use of the expression ‘the Crown in right of…’ 122 However, the ‘Crown’ was inapt to describe ‘complex political structures’ that exist in a federation. 123 It was ‘of no assistance in determining today’ whether the UK was a ‘foreign power’ in s 44(i) of the Constitution. 124 Gaudron J said that the Constitution implied that the ‘Crown’ was divisible. The States were ‘separate bodies politic with separate legal personality’. These bodies politic were separate from each other and separate from the Commonwealth, which was termed a ‘body politic…with its own legal personality’. That these bodies politic were separate was ‘recognised throughout the Constitution’, particularly in ss 75(iii), 75(iv) and 78 in Chapter III. 125
Kirby J developed these concepts in Baxter Healthcare 126 in the context of the doctrine of ‘Crown’ immunity. To hold the Commonwealth immune from the application of statutes was to assume that the Commonwealth was legally equivalent to the ‘Crown’, an assumption ‘inconsistent with the text, purpose and character of the Australian Constitution and of its constituent polities’. 127 The Constitution had created new constitutional entities, called ‘polities’ or ‘governmental polities’, which derived their existence and character from the text. 128 Kirby J referred to the judgment of Dixon J in the Bank Nationalisation Case and said that the ‘starting point for the enlightenment’ 129 should be the decision of the Supreme Court of Ireland in Byrne v Ireland. 130 There, a majority of the Irish Supreme Court held that the royal prerogative was based upon the notion that ‘the Crown personified the State’, 131 and that this notion was inconsistent with Article 2 of the Constitution of Saorstát Éireann of 1922, which declared that the powers of government and all authority were derived from the people of Ireland. Walsh J held that the ‘sovereign people’ had thereby created a ‘state’-like entity called ‘Saorstát Éireann’. 132
These judgments show an evolution in the High Court’s thinking about governmental legal personality. Previously, the relevant constitutional provisions were assumed to reflect a theory according to which the Sovereign or the ‘Crown’ (as corporation sole or aggregate) was a legal person, holding public lands, funds and other rights/duties on behalf of the government or the people. This theory was unworkable in a federal system and has been abandoned. The judgments in which this occurred emphasised the text and structure of the Constitution as providing the anchor for understanding the juridical nature of the Commonwealth. But this can only take matters so far. The vagueness of the usages of the term ‘Commonwealth’ in the Constitution, which may even have been deliberate, 133 means that different theories are available, depending upon the way that the senses of the term ‘Commonwealth’ are understood to relate to each other. Provisions referring to the Commonwealth (legal person) might be grouped together with provisions referring to the nation, in effect so as to render the nation a legal person. Alternatively, provisions referring to the legal person might be grouped with those referring to the government, in effect so as to render the whole of the government a legal person. This article suggests that the better view is that the provisions referring to the legal person are a free-standing category: neither the nation, nor the government, is sensibly treated as a legal person; while the constitutional person should not be elided with the nation or the government.
Williams v Commonwealth
It is convenient next to consider the decision of the High Court in Williams (No 1), which is both the most recent consideration of the legal personality of the Commonwealth and a useful illustration of apparently competing approaches to its theorisation. Williams (No 1) involved a challenge to the provision of funding to the Darling Heights State School through the Department of Education, Employment and Workplace Relations, under the National School Chaplaincy Program. The funding was provided through an agreement between the Commonwealth and a company incorporated under the Corporations Act 2001 (Cth). The validity of the expenditure was challenged.
The Commonwealth’s ‘broad submission’ in Williams (No 1) was that the Commonwealth had an ability to contract and pay money that was relevantly unlimited by reference to considerations about the ‘breadth’ of executive power. The basis for the submission was that to contract and spend (appropriated) money were activities taking effect under the ‘general law’, for which no specific source of executive power was required. The submission was understood by their Honours to involve the proposition that, because it was a legal person, the Commonwealth has a ‘relevantly unlimited power to pay and to contract to pay money’, analogous to that of a natural person. 134 The rejection of this ‘broad submission’ in six separate majority judgments presents a number of seemingly competing approaches to the relationship between executive power and the legal personality of the Commonwealth. 135
French CJ accepted that the executive power ‘extends to…powers defined by the capacities of the Commonwealth common to legal persons’.
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Moreover, his Honour accepted that the executive power would occasionally support the making of contracts without legislation.
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French CJ described the executive power as ‘that power exercised by It is, as the plaintiff submitted, an error to treat the Commonwealth executive as a separate juristic person. The character of the Executive Government as a branch of the national polity is relevant to the relationship between the power of that branch and the powers and functions of the legislative branch and, particularly the Senate.
139
It is convenient next to consider the judgment of Crennan J, since her Honour was the only other judge explicitly to state that the executive power included ‘the powers which derive from the capacities of the Commonwealth as a juristic person’. 143 Her Honour rejected the Commonwealth’s ‘broad submission’ essentially for three reasons. The first was the principle of parliamentary control by which the executive is made accountable to Parliament for expenditure. 144 The second was the potential for Commonwealth contracts to be used ‘to regulate activity in the community’. 145 The third was the possibility that ‘citizens would be unable to avail themselves of the constitutional protection in s 109 against inconsistent legislation’ in cases where Commonwealth executive acts collided with State legislative acts. 146 These reasons required rejection of the submission that legal personality could itself furnish the executive with power to bind the Commonwealth to contracts and expenditure.
The joint judgment of Gummow and Bell JJ accepted that the Commonwealth was a legal person.
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Their Honours also accepted that the executive power would, within its appropriate sphere, support the making of a contract. For what may be reduced to two reasons, their Honours rejected the Commonwealth’s ‘broad submission’. The first was that it conflated the capacities of the ‘Commonwealth’ to contract and spend with the ‘distinct and special financial privileges associated with the prerogative’.
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The second denied the analogy to a human being, similarly to the passage of French CJ quoted above, on the basis that executive power must be understood in the federal setting of the Constitution: [T]he Commonwealth parties’ [broad submission] appears to proceed from the assumption that the executive branch has a legal personality distinct from the legislative branch, with the result that the Executive is endowed with the capacities of an individual. The legal personality, however, is that of the Commonwealth of Australia, which is the body politic established under the Commonwealth of Australia Constitution Act 1900 (Imp), and identified in covering cl 6.
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Hayne J saw the concentration on the Commonwealth’s ‘capacity’ to contract as a distraction. ‘As a polity’, Hayne J said, ‘the Commonwealth is not under any disability preventing it from making a contract or a disposition of property’.
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The language of ‘capacity’ distracted from the question whether the Executive had any ‘power’ to make the payments.
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His Honour said: There is no basis in law for attributing human attitudes, form, or personality either to the federal polity that was created by the Constitution or, as the Commonwealth parties sought to do, one branch of the government of that polity — the Executive. The argument asserting that the Executive Government of the Commonwealth should be assumed to have the same capacities to spend and make contracts as a natural person was no more than a particular form of anthropomorphism writ large. It was an argument that sought to endow an artificial legal person with human characteristics. The dangers of doing that are self-evident.
154
Heydon J accepted the submission that, subject to immaterial exceptions, s 61 of the Constitution has a ‘breadth’ that is coterminous with the areas of Parliament’s legislative competence, whether or not that competence had been exercised. 159 His Honour therefore did not need to consider the Commonwealth as legal person, beyond observing that, prima facie, the statements of Brennan J in Davis v Commonwealth 160 and French CJ and the plurality in Pape 161 supported the proposition that the executive power includes within its appropriate ‘breadth’ the ‘capacities’ that may be possessed by persons other than the Executive. A prime example was the ‘capacity to contract’. 162
Similarly to Hayne J, Kiefel J also saw the language of ‘capacity’ as a distraction. Her Honour said that ‘capacity of the Commonwealth Executive to contract’ was irrelevant to the question whether the Executive had a ‘power to spend’. 163 The question was ‘not one of the Executive’s juristic capacity to contract, but its power to act’. 164 A difference between the contracts of the ‘Commonwealth executive’ and those of a ‘natural person’ was that, when the ‘Commonwealth contracts, it may be committing to the expenditure of public moneys’. 165 The primary consideration, however, was that the power of the executive to spend was limited to ‘the confines of some power derived from the Constitution’. 166 Examples of the extent of the executive power were the prerogative, the subject matters of express legislative powers and ‘matters which are peculiarly adapted to the government of a nation’. 167 Because the payments and the contract in this case did not fall within any of those aspects of ‘breadth’, they were invalid.
The conclusion relevantly deducible from Williams (No 1) is that the Commonwealth’s legal personality neither broadens nor trumps the ‘breadth’ dimension of executive power. The majority judgments advanced diverse reasons justifying this conclusion. The ‘broad submission’ was treated as a syllogism, because it sought to infer the existence of the necessary ‘power’ from the premises: (a) that the Commonwealth is a legal person, with capacities no less extensive than those of human beings; and (b) that human beings have full suite of capacities. Each judgment accepted that the ‘Commonwealth’ had capacity to contract, and therefore each judgment accepted, whether overtly or implicitly, that the Commonwealth is a legal person. A subsequent challenge to the authority of Williams (No 1) was rejected in Williams (No 2). 168
Common to the majority judgments is the acceptance of three propositions or premises. First, a power to spend, and to contract to spend, appropriated moneys must be found in the Constitution or in otherwise valid statutes. 169 In this connection, a number of the judgments suggest that the Executive Government is not, itself, a legal person. Second, s 61 of the Constitution might authorise a contract or expenditure if the ‘breadth’ dimension were otherwise satisfied. 170 In other words, and perhaps uncontroversially, the executive power of the Commonwealth does support expenditure and contracts, where it is otherwise found to exist. Third, the agreement and payments in question were invalid, as being beyond the executive power. 171 Beyond that, different reasons are advanced for rejecting the ‘broad submission’, each containing interesting but occasionally competing insights about legal personality.
The effect of the Williams cases is to place the Commonwealth in a position materially different from other non-human legal persons. The rules of attribution applicable to companies, for example, do not require the identification of a ‘power’ vested in an authorised officer before the behaviour of that officer will count as the acts of the company. 172 Across all majority judgments, it emerges clearly that the Commonwealth is not to be treated as any other legal person, capable without more of voluntarily committing itself to pay money lawfully in its possession and control. That is not because of some deficiency in the Commonwealth’s ‘capacity’ — to the contrary, all judgments affirmed the Commonwealth’s capacity to enter into the contract in question. Instead, it is because of the limitations upon the exercise of executive power by the individuals through whom the Commonwealth (legal person) acts from time to time.
Competing Theories
The judgments in Williams (No 1) used the terms ‘body politic’ or ‘polity’ to describe two distinct concepts: nation and government. Those concepts were ascribed or attributed legal personality. This appears to underscore a theoretical divergence, though it is possible that the putative divergence actually reflects only an underlying ambiguity about what the terms ‘body politic’ or ‘polity’ actually mean.
The terms ‘body politic’ and ‘polity’ originate (respectively) in late medieval and ancient times. The term ‘body politic’ (corps politique) was introduced in the Year Books in 1478, 173 whereas ‘polity’ (from the Greek πολιτεία) was the title of one of Plato’s works (which Cicero rendered in Latin as politia). There are a number of cognate expressions, including ‘political entity’, 174 ‘political unit’, 175 ‘political organism’ 176 and ‘politically organised body’. 177 Interestingly, all share the adjective ‘political’, 178 or some derivation thereof, and in many cases feature the metaphor of a living organism. 179 A survey of their usage in Australian cases reveals that these terms lack a settled connotation.
In their first usage, the terms ‘polity’ and ‘body politic’ describe a composite of ‘government’ and the people who are governed, united by rules embodied in the Constitution. For example, a person born in Australia to an Australian citizen is said to be a ‘member of the Australian body politic’, 180 whereas the status of ‘alien’ is given to a person who is not a member of the ‘body politic’. 181 The cases suggest that the Commonwealth as ‘body politic’ or ‘polity’ is made up of at least the territory, 182 the people 183 and the organs and institutions of government at both federal and state level. 184 It is created and underpinned by the Constitution 185 and, at least according to some judges, sustained by popular compact. 186 Reference was given above to the judgment of Gummow and Crennan JJ in Thomas v Mowbray, 187 holding that the ‘notion of a “body politic” cannot sensibly be treated apart from those who are bound together by that body politic’. 188 Likewise, it is sometimes said that the Commonwealth is a ‘single polity’, 189 which has the character of a ‘dualist federal polity’ 190 in that it is ‘made up of’ 191 or ‘divided into federal, state and territory governments’. 192 Or, as Kirby J said in Mobil Oil Australia v Victoria, 193 the ‘Commonwealth of Australia is a polity in which governmental powers are shared’.
There are judgments that appear to treat the ‘body politic’/‘polity’ in this broader usage (ie as nation) as a legal person. The joint judgment of Gleeson CJ, Gummow and Hayne JJ in Sue v Hill 194 indicated that the first use of the expression ‘the Crown’ was as a ‘device to dispense with’ 195 the recognition of the ‘State as a juristic person’. 196 The ‘State as juristic person’ was in turn called the ‘body politic’. 197 In Lam, 198 McHugh and Gummow JJ said that, whereas there had been a lack of understanding in the UK of the ‘state’ as a ‘body politic’, the ‘federal system of government’ in Australia required ‘such an understanding’. 199 The thread of these judgments is picked up in Eastman’s Case, 200 where Gummow and Hayne JJ referred with approval to Barwick CJ’s observations in Spratt v Hermes 201 that the Constitution ‘brought into existence but one Commonwealth, which was, in turn, destined to become the nation’. 202 Gummow and Hayne JJ said: ‘The term ‘the Commonwealth’ in ss 1, 61 and 71 is used consistently to identify the body politic identified in the covering clauses to the Constitution’. 203 Then, in Williams (No 1), Gummow and Bell JJ said that ‘[t]he legal personality’ was ‘that of the Commonwealth of Australia’, rather than the executive branch, and that the Commonwealth was the ‘body politic established under the [Constitution], and identified in covering cl 6’. 204 If it be legitimate to read these judgments (which share a common author) in sequence, then this appears to be a conception of the Commonwealth as a nation, which is a legal person under domestic law.
One expression of this conception, suggested by Professor Walker in relation to the ‘British State’, comprehends it as ‘a corporation aggregate consisting of all those persons connected with…Great Britain and Northern Ireland by ties of nationality and domicile’, with a ‘managerial body called the government’. 205 The key elements of the theory are that the Commonwealth is a legal person that consists of or comprises the people and is controlled or affected by the government, operating in effect as a Board of Directors. The coherence of this theory depends on how the ‘nation’ or ‘political community’ is defined. As noted above, a prominent definition treats the Commonwealth (nation) as indissolubly ‘comprising’ the people, the federal and State governments, and the whole territory. If it be correct that the Commonwealth (nation) ‘cannot sensibly be treated apart from those who are bound together by [it]’, 206 then the theory would appear to fail, because it cannot accommodate the logical necessity for legal antagonism between the constitutional person and individuals, and State constitutional persons, who together constitute the Commonwealth (nation). Furthermore, the very point of artificial legal personality is to distinguish the entity from the natural persons by which it is constituted. 207 In what sense, then, is the nation ‘comprised’ of its members? Ex hypothesi, the Commonwealth (constitutional person) must be a distinct legal person from the people and the States. Once that distinction is admitted, ie between the legal person and the people (as its ‘members’), then the theory that the nation is a legal person seems not to advance matters very far. It seems to reduce to the proposition that the constitutional person simply represents the people of Australia, perhaps analogously to the way that a company can be said to represent, and yet conduct litigation against, its shareholders. Representation, in this sense, is something that could be claimed for any theory.
The second usage of ‘polity’ and ‘body politic’ is to describe a component government (in the broad sense, encompassing all branches) of the nation. In the Engineers’ Case, Gavan Duffy J said that the ‘existence of the State as a polity is as essential to the Constitution as the existence of the Commonwealth’.
208
These words were picked up and quoted in West.
209
In Burns v Ransley,
210
Dixon J gave the following definitions for the statutory phrase ‘the Government or Constitution of the Commonwealth’: I take the word ‘Government’ to signify the established system of political rule, the governing power of the country consisting of the executive and the legislature considered as an organised entity and independently of the persons of whom it consists from time to time .… The word ‘Constitution’…probably has the same meaning, and, if so, it does not refer to a document or instrument of government but to the polity or organized form of government which the fundamental rules of law have established whether they are expressed in a written constitution or not.
211
The term ‘body politic’ is also used in this sense, although perhaps less frequently. In the Second Territory Senators Case,
214
in the context of an issue estoppel, Aickin J said: Generally speaking when an Attorney-General sues to enforce a public right or liberty he does so as representing Her Majesty’s subjects, and not the
There are judgments that can be read as supporting a theory that the ‘body politic’/‘polity’ in this second usage (ie as government) is a legal person. French CJ emphasised that the executive power of the Commonwealth was the power ‘exercised by the Commonwealth as a polity through the executive branch of its government’. 220 This suggests that the polity incorporates the branches of government and acts through them. It would be an error, French CJ said, to ‘treat the Commonwealth Executive as a separate juristic person’. 221 It seems to be implicit that the Executive Government shares the ‘juristic personality’ of the Commonwealth (legal person), which is in turn the ‘polity’. What his Honour seems to postulate is that the government as a whole (the ‘polity’) is a legal person, comprising various branches. The separate judgment of Hayne J in Williams (No 1) is replete with such language. His Honour said that the expenditures in issue in the case were ‘expenditures made by the executive government of a polity — an artificial legal person’, 222 that the Executive Government of the Commonwealth was ‘the executive government of an artificial legal entity — a polity’, 223 and that the Commonwealth makes contracts and can outlay public money ‘as a polity’. 224
The core notion seems to be that governmental powers are vested in the Commonwealth and exercised by and through its governmental ‘branches’ or ‘organs’, over or in respect of people as ‘members’. The concept is similar to a Local Government Authority, 225 which is a legal person invested with governmental powers exercisable over persons within its jurisdiction. But this theory is textually insupportable. Governmental powers are not vested by the Constitution in the ‘Commonwealth’. Instead, the legislative power ‘of the Commonwealth’ is vested in ‘a Federal Parliament’. Moreover, certain provisions (ss 75(iii) and 114) are premised upon a distinction between the Commonwealth (legal person) and the Commonwealth (government). The theory cannot accommodate the functional reality, that government is comprised of a multitude of persons, institutions and entities, many of which are acknowledged for legal purposes as having personality distinct from that of the Commonwealth.
It is not clear whether any difference in theory is intended between those who adopt these two different usages. Nevertheless, it does seem clear that both views are broader than what was comprehended during the currency of the ‘Crown’. It is an axiom of British constitutionalism that there is no conception of the ‘state’ as a legal person. 226 Turpin and Tompkins, for example, declare that ‘there is no legal entity called “the state” in which powers are vested or to which allegiance or other duties are owed’. 227 The ‘Crown’ is said to be the nearest equivalent concept, but the ‘Crown’ has never corresponded to the ‘state’ in this sense. As Mason CJ, Deane and Dawson JJ said, the ‘Crown’ is only ‘a limited aspect of “the State” in the broad sense’. 228 British constitutionalism does have a legal conception of the state. Professor Janet McLean detected a sophisticated state-tradition in British legal thought, which she describes as ‘contested, adaptable and complex’. 229 What is admittedly missing is a conception of the whole of the ‘state’ as a legal person. The ‘Crown’ as corporation has never been equivalent to the ‘state’; and the ‘state’, in this broader sense, has never been treated as a legal person.
The third usage of the terms ‘body politic’ (and, to a lesser extent, ‘polity’) is simply to describe a public body (that may or may not be an artificial legal person) created for a public purpose. It has been a common feature of English parliamentary drafting that the term ‘person’ should be defined so as to include a ‘body politic’, and this device has been adopted in Australia.
230
In a 1925 case, Isaacs J said of the Real Property Act 1915 (Vic): The Act is quite general. It includes by sec. 16, under the expression ‘person’, a body politic and ‘classes of persons’. ‘Body politic’ is found in the Magdalen College Case.
231
…The expression ‘body politic’, as distinguished from ‘body corporate’, indicates to my mind a body created for some public purpose. For instance, the Hudson’s Bay Company and the East India Company, invested with public functions, were bodies politic. The Sovereign is a body politic (see Magdalen College Case). In Attorney-General for Ontario v Attorney-General for the Dominion,
232
Lord Watson used the expression ‘body politic’ to denote the Dominion of Canada.
233
(emphasis added)
The first reported application of the term ‘body politic’ to the Commonwealth was in 1905, in The Commonwealth v Baume. 236 In that case, Griffith CJ said that the ‘Commonwealth’ as mentioned in the Judiciary Act 1903 (Cth) ‘means the body politic called by that name…[which] stands for the Crown as representing the whole community’. 237 In the same case, O’Connor J said that ‘Commonwealth representing the Executive power of the community, or the Crown as it is sometimes called’ was ‘constituted a juristic person’. 238 Here, ‘body politic’ is a synonym for the ‘Crown’, which ‘represents’ (but perhaps does not incorporate) either ‘the whole community’ or the ‘executive power’. Later, it was held by reference to the Acts Interpretation Act 1901 (Cth) that, because the word ‘person’ includes ‘body politic’, it ‘therefore includes the Commonwealth’. 239 In Queensland Rail, the plurality said that the Authority had a separate legal personality, and ‘is not, and is not a part of, the body politic which is the State of Queensland’. 240
Conclusion
The cases and materials reviewed in this article suggest that there may be a theoretical divergence in the way that governmental legal personality is understood in Australia: all agree that the Commonwealth is a legal person, but some appear to conceive that legal personality as an attribute of the ‘nation’, whereas others appear to conceive it as an attribute of the ‘government’. The article has suggested that the preferable view is that the constitutional person is not to be conflated with the people, the federal government or the nation. In the words of Professor Sawer, there is ‘in fact no juristic entity corresponding to the Commonwealth as a whole’. 241 The constitutional person should be understood as having a legal existence separate and distinct from other manifestations of the ‘Commonwealth’ — it is simply a unit of the legal system, in respect of which legal personality has been constitutionally conferred, which acts by or through the Executive Government, and holds its lands, funds etc on behalf of the people of Australia. In that sense, it resembles the ‘Crown’, which never corresponded to the whole ‘state’, 242 but was only seen as ‘a limited aspect of “the State” in the broad sense’. 243 Though it may act by or through members of the Executive Government, the constitutional person is not an incorporation of the Executive Government 244 nor of the government more broadly. Though it may hold its lands, funds etc on behalf of the people of Australia, the constitutional person is not an incorporation of the nation or the people comprising the nation.