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Airport Handling Services Australia Pty Ltd & Ors v FC of T

Judges:
O'Callaghan J

Court:
Federal Court of Australia

MEDIA NEUTRAL CITATION: [2021] FCA 1405

Judgment date: 15 November 2021

O'Callaghan J

INTRODUCTION

1. I have before me eight appeals brought pursuant to s 14ZZ of the Taxation Administration Act 1953 (Cth) against decisions of the Commissioner of Taxation that each applicant was not entitled to certain payments under the "JobKeeper Payment scheme" ( JobKeeper scheme ). The JobKeeper scheme was a wage subsidy program announced by the Prime Minister on 30 March 2020 to help keep Australians in jobs in the face of the economic impact of the coronavirus. It was intended to benefit around six million workers, including by the payment of $1,500 per fortnight through their employers.

2. In his announcement, the Prime Minister said that the program would begin on that day and that eligible businesses could begin distributing JobKeeper payments immediately. The Prime Minister also said that employers would be reimbursed for doing so, from the first week of May 2020.

3. Each of the applicants was and is an entity in which the government of Dubai holds a total participation interest of 100% for the purposes of s 880-15(c)(i) of the Income Tax Assessment Act 1997 (Cth) (the ITAA 1997 ). Each of the applicants was and is also an Australian resident for the purposes of s 880-15(c)(ii).

4. Between 30 March and 9 April 2020, certain of the applicants made wage payments of at least $1,500 per fortnight per employee, in anticipation that they would be subsidised under the JobKeeper scheme, on the basis of the Prime Minister's announcement.

5. The Coronavirus Economic Response Package (Payments and Benefits) Rules 2020 (Cth) (the JobKeeper Rules ) were made under s 20 of the Coronavirus Economic Response Package (Payments and Benefits) Act 2020 (Cth) (the JobKeeper Act ), and were registered under Chapter 2 of the Legislation Act 2003 (Cth) (the Legislation Act ) on 9 April 2020, the same day that the JobKeeper Act received Royal Assent.

6. Section 6(1) of the JobKeeper Rules provided:

6 Employer's entitlement to JobKeeper payment for an employee

  • (1) An entity (the employer ) is entitled to a JobKeeper payment for an individual for a fortnight if:
    • (a) the fortnight is a JobKeeper fortnight (see subsection (5)); and
    • (b) the employer qualifies for the JobKeeper scheme at or before the end of the fortnight (see section 7); and
    • (c) the individual is an eligible employee of the employer for the fortnight (see section 9); and
    • (d) the employer has satisfied the wage condition in section 10 in respect of the individual for the fortnight; and
    • (e) the employer has notified the Commissioner in the approved form at or before the time referred to in subsection (2) that the employer elects to participate in the JobKeeper scheme; and
    • (f) the employer has given information about the entitlement for the fortnight, including details of the individual, to the Commissioner in the approved form; and
    • (g) the employer has not notified the Commissioner in the approved form that the employer no longer wishes to participate in the JobKeeper scheme.

7. "JobKeeper fortnight" was defined to mean the fortnight beginning on 30 March 2020, and each subsequent fortnight, ending with the fortnight ending on 27 September 2020 (see s 6(5) of the JobKeeper Rules).

8.

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Section 7(2)(e) of the JobKeeper Rules provided that an entity did not qualify for the Jobseeker scheme if it was "a sovereign entity" within the meaning of s 880-15 of the ITAA 1997, which relevantly defined such an entity as including an entity in which a "(c) a body politic of a foreign country holds a total participation interest of 100% … (ii) that is not an Australian resident". Because each of the applicants was an Australian resident within the meaning of that provision, the exclusion did not apply to them.

9. Between 10 April and 1 May 2020, the applicants made wage payments of at least $1,500 per fortnight per employee, in the expectation that those payments would be subsidised under the JobKeeper scheme, on the basis of each applicant's self-assessed eligibility under the JobKeeper Rules.

10. On 25 April 2020, the Commissioner announced that the time for enrolling for the initial JobKeeper periods had been extended from 30 April until 31 May 2020, and that for the first two fortnights, 30 March - 12 April and 13 April - 26 April (the relevant fortnights ), the Commissioner would accept that an employer had paid the minimum $1,500 payment for each fortnight, even if paid late, provided it was paid by the end of April.

11. As at 1 May 2020, all but one of the applicants had complied with s 6(1)(a)-(e) and (g) of the JobKeeper Rules; another had complied with s 6(1)(a)-(d) and (g); none of them had complied with s 6(1)(f); and one (Airline Handling Services Australia Pty Ltd) had also not complied with s 6(1)(e).

12. The Coronavirus Economic Response Package (Payments and Benefits) Amendment Rules (No 2) 2020 (Cth) (the Amending Instrument ) was registered on 1 May 2020. It provided that it commenced "[i]mmediately after this instrument is registered".

13. Relevantly, the Amending Instrument amended the exclusion of a sovereign entity in s 7(2)(e) of the JobKeeper Rules. It extended the exclusion to an entity that "would be a sovereign entity if subparagraphs 880-15(c)(ii) and (iii) of the Income Tax Assessment Act 1997 were disregarded". It was common ground that once the requirement in subparagraph 880-15(c)(ii) (that the sovereign entity not be an Australian resident) was disregarded, each of the applicants was an excluded sovereign entity and could no longer meet the requirement for entitlement contained in s 6(1)(b) of the JobKeeper Rules.

14. The amendment to s 7(2)(e) was expressed to apply "in relation to JobKeeper fortnights beginning on or after 30 March 2020" (s 101 of the JobKeeper Rules, as inserted by the Amending Instrument Sch 1 item 46).

15. After the applicants became aware of the effect of the amendment to s 7(2)(e), they ceased making relevant payments to their employees.

16. On 25 May 2020, the applicants jointly made a submission to the Commissioner, seeking his agreement that, by virtue of s 12(2) of the Legislation Act, their entitlement to receive JobKeeper payments for the relevant fortnights was not affected by the amendments to the definition of "sovereign entity" in s 7(2)(e).

17. By either 28 or 29 May 2020 (it varied from applicant to applicant), each of the applicants had fulfilled all the requirements of s 6(1) of the JobKeeper Rules.

18. On 28 May, Airline Handling Services Australia Pty Ltd lodged its "JobKeeper Enrolment Form" under s 6(1)(e).

19. On either 28 or 29 May (it varied from applicant to applicant) each applicant lodged a "JobKeeper Application Form", pursuant to s 6(1)(f) of the JobKeeper Rules, claiming what was in substance a refund of the amounts that they had paid in respect of the relevant fortnights.

20. On 22 July 2020, the Commissioner issued notices of his decisions that the applicants were not entitled to such a refund, to which the applicants jointly objected in a Notice of Objection.

21. On 11 December 2020, the Commissioner issued notices in common form disallowing the Notice of Objection.

22. On 8 February 2021, the applicants each filed a Notice of Appeal under s 14ZZ of the Taxation Administration Act 1953 (Cth).

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THE GROUNDS OF APPEAL

23. Three grounds of appeal were argued.

24. The first and second grounds are the principal grounds, and they are inter-related.

25. They both turn on the terms of s 12 of the Legislation Act, which relevantly provides:

Commencement of legislative instruments and notifiable instruments

When do legislative instruments and notifiable instruments commence?

  • (1) A legislative instrument or a notifiable instrument commences:
    • (a) at the start of the day after the day the instrument is registered; or
    • (b) so far as the instrument provides otherwise-in accordance with such provision.

      Note: The instrument may provide for its commencement by enabling a commencement instrument to be made: see subsection (5).

Retrospective commencement

  • (1A) Despite any principle or rule of common law, a legislative instrument or notifiable instrument may provide that the instrument, or a provision of the instrument, commences before the instrument is registered.

    Note: The effect of this subsection is to allow legislative and notifiable instruments to commence retrospectively (subject to subsection (2)). This subsection is subject to a contrary provision (see subsection (4)).

Retrospective application

  • (2) However, if a legislative instrument or notifiable instrument, or a provision of such an instrument, commences before the instrument is registered, the instrument or provision does not apply in relation to a person (other than the Commonwealth or an authority of the Commonwealth) to the extent that as a result of that commencement:
    • (a) the person's rights as at the time the instrument is registered would be affected so as to disadvantage the person; or
    • (b) liabilities would be imposed on the person in respect of anything done or omitted to be done before the instrument is registered.

Retrospective commencement or application subject to contrary provision

  • (4) The effect of subsection (1A) or (2) in relation to an instrument is subject to any contrary provision in an Act.

Commencement instruments

  • (5) Without limiting paragraph (1)(b), for the purposes of that paragraph, a legislative instrument or notifiable instrument may authorise the making of a commencement instrument in relation to the legislative instrument or notifiable instrument.

26. Section 2B of the Acts Interpretation Act 1901 (Cth) ( AIA ) provides that, in any Act, "commencement, in relation to an Act or a provision of an Act, means the time at which the Act or provision comes into operation".

27. Section 3 of the AIA, headed "When Acts come into operation", provides: "If an Act or a provision of an Act is expressed to come into operation on a particular day (whether the expression 'come into operation' or 'commence' is used), it comes into operation at the start of the day".

28. Two questions arise under s 12 of the Legislation Act. The first is whether the Amending Instrument "commenced" before it was registered within the meaning of s 12(2). The applicants contended that it did, and that because the amendment had retrospective application, the second question falls to be determined, viz whether the applicants had any "rights" within the meaning of s 12(2)(a) of the Legislation Act, under either of s 6 or s 7 of the JobKeeper Rules at the time that the Amending Instrument was registered. The applicants contended that that question is also to be answered yes, and that as at 1 May 2020, they each had an accrued, albeit conditional, right to claim JobKeeper payments for the two relevant fortnights.

29. The Commissioner contended to the contrary. He said that the Amending Instrument did not commence before registration, and that when it said that it commenced immediately after it was registered (on 1 May 2020) it meant what it said, and that s 12(2) therefore has no

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operation. He next contended that the applicants did not have a right to JobKeeper payments as at 1 May 2020 that "would be affected so as to disadvantage" them, and that it was only on 28 or 29 May 2020 (depending on the applicant) that they had complied with each of the necessary preconditions to entitlement to the JobKeeper payments under s 6(1) of the JobKeeper Rules. By then, so the Commissioner contended, the applicants no longer qualified by reason of the provision in s 7(2)(e) of the JobKeeper Rules excluding resident sovereign entities, and therefore could not satisfy s 6(1)(b). The Commissioner did not seek to contend that there would be no relevant disadvantage should such rights exist, but rather, that the applicants did not have any accrued rights capable of being affected by the amendment.

30. The applicants also contended, in the alternative, that if their contentions about s 12(2) of the Legislation Act were wrong, then the Amending Instrument would be ultra vires the instrument-making power in s 20 of the JobKeeper Act.

31. For the reasons that follow, the questions are answered as follows:

  • (1) Did the Amending Instrument commence before it was registered, within the meaning of s 12(2) of the Legislation Act?

    Answer: Yes

  • (2) On the assumption that the answer to question (1) is yes, that is, the amendment to s 7(2)(e) was retrospective, did the applicants have any "rights" within the meaning of s 12(2)(a) of the Legislation Act under either of s 6 or s 7 of the JobKeeper Rules at the time that the Amending Instrument was registered on 30 May 2020?

    Answer: No

  • (3) Is the Amending Instrument ultra vires the instrument-making power in s 20 of the JobKeeper Act?

    Answer: The question does not arise. If it did, the answer would be no.

THE FACTS

32. The eight applicants are Airport Handling Services Australia Pty Ltd ( AHSA ) (VID48/2021); Airline Cleaning Services Pty Ltd ( ACS ) (VID49/2021); Alpha Flight Services Pty Ltd ( AFS ) (VID50/2021); Dnata Pty Ltd ( Dnata ) (VID51/2021); Dnata Airport Services Pty Ltd ( DAS ) (VID52/2021); Emirates Hotels (Australia) Pty Ltd ( EHA ) (VID53/2021); Emirates Leisure Retail (Australia) Pty Ltd ( ELRA ) (VID54/2021); and Snap Fresh Pty Ltd ( SFPL ) (VID56/2021).

33. The facts relevant to each proceeding were agreed, and were contained in a statement of agreed facts (Exhibit A1).

34. Each of the applicants employed a workforce in Australia. ACS employed cleaners of aircraft. AHSA employed personnel providing airport passenger services. AFS employed personnel providing airline catering services. DAS and Dnata employed personnel providing various airport ground handling services. EHA employed personnel providing hotel and resort services, as well as employees performing other roles in the hospitality industry. ELRA employed personnel providing hospitality services across a number of restaurants, cafes, and bars, as well as employees performing other roles in the hospitality industry. SFPL employed personnel providing catering services to a range of industries, including airlines and the health care sector. It was agreed that each of the applicants, other than EHA and SFPL, also employed "employees performing other roles in the aviation industry".

35. Between 30 March and 9 April 2020, some of the applicants made wage payments of at least $1,500 per fortnight per employee, in anticipation that they would be subsidised under the JobKeeper scheme, on the basis of the Prime Minister's announcement, as follows:

  • (a) ACS paid a total of $111,000 to 74 "time worked" employees on 8 April 2020;
  • (b) DAS paid a total of $2,544,000 to 1,696 employees on 9 April 2020;
  • (c) EHA paid a total of $111,000 to 74 employees on 9 April 2020;
  • (d) AFS made some payments to some "time worked" employees on 7 April 2020; and
  • (e) ELRA made some payments to some "top up" and "time worked" employees on 6 April 2020.

36.

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Between 10 April and 1 May 2020 (that is, from the day after the JobKeeper Rules were registered), each of the applicants made wage payments of at least $1,500 per fortnight per employee, in the expectation that the payments would be subsidised under the JobKeeper scheme, on the basis of each applicant's self-assessed eligibility. In addition, all applicants except for AHSA also provided their JobKeeper Enrolment Form to the Commissioner pursuant to s 6(1)(e) during this period.

37. On 30 April 2020, ACS paid a total of $919,500 to 146 "stood down" employees and 467 "top up" employees for the first fortnight. It paid a total of $1,030,500 to 687 employees for the second fortnight on 22 and 30 April 2020. ACS provided its JobKeeper Enrolment Form to the Commissioner on 28 April 2020.

38. AHSA paid a total of $46,500 to 31 employees for the first fortnight on 21 April 2020, and again for the second fortnight on 28 April 2020.

39. AFS made some payments to some "time worked" employees on 14 April 2020, and paid $933,000 to 622 "top up" employees on 1 May 2020 for the first fortnight. On 21 and 28 April 2020, it paid a total of $948,000 to 632 employees for the second fortnight. It provided its JobKeeper Enrolment Form to the Commissioner on 21 April 2020.

40. DAS paid a total of $2,541,000 to 1,694 employees on 25 and 26 April 2020 for the second fortnight and provided its JobKeeper Enrolment Form to the Commissioner on 30 April 2020.

41. On 29 April 2020, Dnata paid a total of $178,500 to 119 employees for the first fortnight, and a total of $177,000 to 118 employees for the second fortnight. It provided its JobKeeper Enrolment Form to the Commissioner on 30 April 2020.

42. EHA paid a total of $115,000 to 77 employees for the second fortnight on 23 April 2020 and provided its JobKeeper Enrolment Form to the Commissioner on 27 April 2020.

43. ELRA paid a total of $327,000 to 218 employees for the first fortnight in payments made on 6, 14 and 28 April 2020, and paid a total of $163,500 to 109 employees for the second fortnight in payments made on 14, 20 and 28 April 2020. It provided its JobKeeper Enrolment Form to the Commissioner on 29 April 2020.

44. SFPL paid a total of $244,500 to 163 employees for the first fortnight, and a total of $153,000 to 102 employees for the second fortnight, in payments made on 24 and 29 April 2020. It provided its JobKeeper Enrolment Form to the Commissioner on 21 April 2020.

45. After the applicants became aware of the effect of the Amending Instrument, they took the following steps.

46. ACS, AHSA and DAS ceased paying "top up" wages to "top up" employees, and ceased paying any wages to "stood down" employees. Dnata and SFPL ceased paying "top up" wages to "top up" employees.

47. EHA ceased paying "top up" wages to "top up" employees, and ceased paying any wages to those employees who were stood down. In addition, it made employees in its Australian workforce redundant, requested other employees to use their leave entitlements, and also requested employees to apply for JobSeeker payment.

48. ELRA made a number of employees in its Australian workforce redundant.

49. The applicants, other than ACS, lodged their JobKeeper Application Forms pursuant to s 6(1)(f) on 28 May 2020. ACS did so on 29 May 2020.

50. AHSA provided its JobKeeper Enrolment Form to the Commissioner pursuant to s 6(1)(e) on 28 May 2020.

QUESTION ONE

Did the Amending Instrument commence before it was registered, within the meaning of s 12(2) of the Legislation Act?

The competing submissions

51. The Commissioner contended that the Amending Instrument did not commence before it was registered, and that it expressly provided to the contrary, namely in s 2(1) of the Amending Instrument, as follows: "Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms". Column 1 specified "[t]he whole of this instrument". Column 2 provided that commencement was

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"[i]mmediately after this instrument is registered" (that is, on 1 May 2020).

52. The Commissioner contended that the applicants' case to the contrary - namely, "that an instrument, which provides that it commences immediately after it is registered, nevertheless commences before [it] is registered" - "defies logic and common sense". He also pointed to ss 2B and 3 of the AIA (set out above at [26] and [27]).

53. The applicants contended that "the first question arises because, although the Amending Instrument stated that it commenced immediately after the instrument was registered (s 2(1)), the amendment to s 7(2) 'appl[ied] in relation to JobKeeper fortnights beginning on or after 30 March 2020' (Sch 1 item 46, inserting new s 101 into the JobKeeper Rules)".

54. The applicants relied on the judgment of Gageler J in
ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1 at 20 [46], for the proposition that the words "shall take effect" and the word "commence" mean the same thing.

55. The applicants also relied on three other matters: (i) the Explanatory Statement to the Amending Instrument; (ii) the legislative history of s 12; and (iii) context. It was submitted that the Explanatory Statement expressly recognised that the amendment to s 7(2)(e) of the Amending Instrument applied retrospectively. The applicants also submitted that s 12(2) exhibits a contrary intention which displaces the definition of "commencement" in s 2B of the AIA. I will set out each of those submissions in turn.

56. The Explanatory Statement to the Amending Instrument, issued by authority of the Treasurer, relevantly said:

Minor and consequential amendments

Item 4 of Schedule 1 to the Amending Rules No. 2 makes a technical amendment to clarify that the exclusion of sovereign entities from qualifying for the JobKeeper scheme applies as if subparagraphs 880-15(c)(ii) and (iii) of the ITAA 1997 were disregarded. Although the changes apply retrospectively from the time of commencement of the Rules when they were registered on 9 April 2020, they are consistent with the intended policy outcome as explained in the Explanatory Statement to the Rules.

The amendment addresses a technical issue in the Rules to ensure that they apply as intended. The definition of 'sovereign entity' in the ITAA 1997 does not include Australian entities of foreign governments. The amendment corrects this unintended outcome in the drafting of the Rules.

57. The applicants relied on the following legislative history.

58. The starting point is the form of the Legislation Act as made, then titled the Legislative Instruments Act 2003 (Cth). Section 12 was headed "When do provisions of legislative instruments take effect?" Sub-section 12(1) relevantly provided that "a legislative instrument that is made on or after the commencing day [of the Legislative Instruments Act 2003 (Cth)], or a particular provision of such an instrument, takes effect from: (a) the day specified in the instrument for the purposes of the commencement of the instrument or provision …"

59. Sub-section 12(2) relevantly provided that "[a] legislative instrument, or a provision of a legislative instrument, has no effect if, apart from this sub-section, it would take effect before the date it is registered and as a result: (a) the rights of a person … as at the date of registration would be affected so as to disadvantage that person …"

60. Those provisions were repealed and substituted in 2015. Sub-sections 12(1), (2) and (3) of the 2015 Act provided:

12 Commencement of legislative instruments and notifiable instruments

When do legislative instruments and notifiable instruments commence?

  • (1) A legislative instrument or a notifiable instrument commences:
    • (a) at the start of the day after the day the instrument is registered; or
    • (b) so far as the instrument provides otherwise-in accordance with such provision.

      Note: The instrument may provide for its commencement by enabling a

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      commencement instrument to be made: see subsection (5).

Retrospective application

  • (2) A provision of a legislative instrument or notifiable instrument does not apply in relation to a person (other than the Commonwealth or an authority of the Commonwealth) if the provision commences before the day the instrument is registered, to the extent that as a result:
    • (a) the person's rights as at that day would be affected so as to disadvantage the person; or
    • (b) liabilities would be imposed on the person in respect of anything done or omitted to be done before that day.
  • (3) However, subject to subsection (2), a legislative instrument or notifiable instrument may provide that a provision of the instrument commences before the day the instrument is registered.

61. The replacement explanatory memorandum to the Acts and Instruments (Framework Reform) Bill 2014 (Cth), circulated with the authority of the Attorney-General, relevantly provided as follows:

The Bill also clarifies provisions that relate to the commencement of legislative instruments, retrospective operation and incorporation by reference. Legislative and notifiable instruments will commence on the day after the day of registration, unless the instrument or enabling legislation provides otherwise. The Bill provides that a legislative or notifiable instrument will not apply to a person retrospectively to the extent that it would affect the person's rights so as to disadvantage them or impose liabilities on the person. This is more targeted than existing section 12(2) of the Legislative Instruments Act, which provides that an instrument will have no effect at all if any provision of the instrument would purport to have such operation. The application of the provision in the Bill can be displaced by expressly providing for retrospective operation in the enabling Act.

…

New section 12 - Commencement of legislative instruments and notifiable instruments

New section 12 replaces existing section 12, which deals with the commencement of legislative instruments. It simplifies the provision, addresses existing problems and expands the provision to the new category of notifiable instrument.

New subsection 12(1) provides a broad rule to replace the detailed provisions of existing subsection 12(1), and is consistent with the commencement rule for Acts in section 3 of the Acts Interpretation Act. New subsection 12(1) provides that a legislative or notifiable instrument commences at the start of the day after it is registered, unless the instrument provides otherwise. New subsection 12(5) provides that a legislative instrument or notifiable instrument may authorise the making of a commencement instrument for that legislative instrument or notifiable instrument, or a provision.

New subsection 12(2) deals with the retrospective application of instruments. Existing section 12 provides that a legislative instrument or a provision of a legislative instrument has no effect if it takes effect before its registration and the rights of a person are affected so as to disadvantage the person, or liabilities are imposed in relation to things done or not done before the instrument is registered. The policy rationale for this rule is that unless there is a clear contrary intention in an Act, a legislative instrument should not have an effect that is both retrospective and to the detriment of an individual.

The application of existing subsection 12(2) could be unpredictable as it can be difficult to determine whether persons to whom an instrument applies will in fact be adversely affected. At times, a provision which aims to provide a positive impact may impact negatively upon a certain person or class of persons. Under existing subsection 12(2), if one person is negatively affected by a retrospective provision or instrument, the provision or instrument would be ineffective in application to any person, both prospectively and retrospectively.

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To address this problem, new subsection 12(2) provides that a provision of a legislative or notifiable instrument will not apply to a person retrospectively to the extent that it would affect the person's rights so as to disadvantage them or impose liabilities on them. This provision achieves the policy objective and removes the potential for unintended consequences. It renders a provision ineffective only to the extent that it has a retrospective adverse effect on a person, rather than rendering it ineffective in relation to all people and for all time. New subsection 12(2) implements recommendation 10 of the 2008 Review of the Legislative Instruments Act 2003.

(Emphasis in the original.)

62. Section 12 of the 2015 Act was further amended in 2018 to, among other changes, insert new sub-s (1A) and repeal sub-s (3). With those amendments, that is the current and relevant form of the Legislation Act set out at [25] above. The explanatory memorandum to the Legislation Amendment (Sunsetting Review and Other Measures) Bill 2018, circulated by authority of the Attorney-General, relevantly provided as follows:

New subsection 12(1A) of the Legislation Act, as inserted by item 5 of Schedule 2, clarifies that a legislative instrument or notifiable instrument may provide that the instrument or a provision of the instrument can commence retrospectively, despite any principle or rule of common law. This is a provision of general application that would include legislative instruments containing offence provisions. However, while the operation of new subsection 12(1A) opens up the possibility that an instrument that prescribes a Commonwealth criminal offence may commence retrospectively, there are safeguards in place to prevent this from occurring.

…

Item 6 repeals and substitutes a new subsection 12(2) that is expressed in substantially the same terms as the repealed provision, with minor changes to reflect the insertion of new subsection 12(1A). New subsection 12(2) operates in the same way as the repealed subsection 12(2), by displacing the effect of new subsection 12(1A) to the extent that the retrospective commencement adversely affects the rights or liabilities of a person other than the Commonwealth. This renders an instrument or provision of an instrument ineffective only to the extent that it has a retrospective adverse effect on a person, rather than rendering it ineffective in relation to all people both prospectively and retrospectively merely because the rights or liabilities of one person have been adversely affected by the retrospectivity.

63. The applicants submitted that the legislative history makes it clear that the amendments (which included substituting "takes effect" with "commences") were not intended to effect "major change" and that "the purpose of the 2015 amendment was to maintain the emphasis on the effect of legislation on a person (rather than its wording), but now directed to the impact of legislation on an individual - the legislation does not apply to a person if it would adversely affect the rights of the person with retrospective effect".

64. It was submitted that the legislative history "indicates that 'commence' in s 12(2) is not confined to the time at which a provision formally begins operation, but includes the time at which a provision takes effect".

65. In his oral address, senior counsel for the applicants summed up the point this way:

And the word "operate" comes from the statutory definition of the word "commence", which I think is to come into operation. So whether it's made to operate or take effect or apply at a date prior to the amending instrument being registered, we say section 12(1A) and 12(2) is directed to such instruments. That is, one looks at the substantive issue that involves considering the nature of the amendments and the transitional provisions that give effect to them at an earlier time. It's not a matter of just looking at the form of the commencement clause, as the Commissioner would have it. We agree that one should look to see if the amending rules alter the law. That's what you should do.

66. As to context, the applicants pointed to the heading to s 12(2), which refers to

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"retrospective application", and to the fact that s 12(1A) (which is headed "retrospective commencement") authorises a legislative instrument to "commence" before registration. They submitted that "it would be an anomalous result if s 12(1A) provided authority for a legislative instrument to come into operation before registration, but did not authorise an instrument that had a retrospective application (such as the retrospective change to the definition of 'sovereign entity' in this case)". They submitted that "[t]he better reading is that s 12(1A) authorises both types of retrospective instrument, subject to s 12(2) and (4)".

67. The Commissioner said that the applicants' contention that, when s 12(2) of the Legislation Act asks whether "a legislative instrument … commences before the instrument is registered", it means to ask whether a legislative instrument "takes effect" prior to registration cannot be accepted.

68. First, he submitted that the applicants' contention is contrary to the definition of commencement in s 2B of the AIA ("commencement, in relation to an Act or a provision of an Act, means the time at which the Act or provision comes into operation").

69. Secondly, he submitted that there are known drafting techniques available for making a legislative instrument commence before registration, if that is what is intended. And the fact that such techniques were not adopted, it was submitted, "speaks powerfully to the intention not to engage s 12" - and their "non-adoption" should "not to be dismissed as a 'mere drafting formality'" (citing
Plaintiff M96A/2016 v The Commonwealth (2017) 261 CLR 582 at 599 [39] (Gageler J) ("Established drafting techniques are available to be used … their availability cannot be assumed to have been overlooked by the parliamentary drafters");
Wilkie v The Commonwealth (2017) 263 CLR 487 at 533 [98] (Kiefel CJ, Bell, Gageler, Keane, Nettle, Gordon and Edelman JJ)).

70. The Commissioner also submitted that the legislative history supported the proposition that "commence" does not mean "takes effect". He submitted that the evident purpose of the 2015 amendments to the Legislation Act was to:

… clarif[y] provisions that relate to the commencement of legislative instruments, retrospective operation and incorporation by reference. Legislative and notifiable instruments will commence on the day after the day of registration, unless the instrument or enabling legislation provides otherwise. (Quoting Replacement Explanatory Memorandum, Act and Instruments (Framework Reform) Bill 2014 (Cth) at page 11.)

…

New section 12 replaces existing section 12, which deals with the commencement of legislative instruments. It simplifies the provision, addresses existing problems and expands the provision to the new category of notifiable instrument. (Ibid at page 30.)

71. He thus submitted that "[i]t is apparent that the change in language was deliberate, and that the change was tied to (rather than constituted any departure from) the definition of commencement in the AIA".

72. Ultimately, the Commissioner submitted, "the surest guide to legislative intention is the language employed by the statute", citing
Certain Lloyd's Underwriters v Cross (2012) 248 CLR 378 at 389-390 [25]-[26] (French CJ and Hayne J).

73. As to the matter of context, the Commissioner submitted that the immediate statutory context undermined the applicants' position, including because the reference to "commenc[ing] before the instrument is registered" in s 12(2) should be read in the context of s 12(1A), which allows legislative and notifiable instruments to commence retrospectively by providing that "[d]espite any principle or rule of common law, a legislative instrument or notifiable instrument may provide that the instrument, or a provision of the instrument, commences before the instrument is registered".

Consideration of question one

74. The gist of the applicants' case in relation to grounds one and two is that the amendment to the eligibility criteria in s 7(2)(e) of the JobKeeper Rules was retrospective, and that the amendment did not apply to them because the commencement of the Amending Instrument affected their rights at the

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time the Amending Instrument was registered so as to disadvantage them, within the meaning of s 12(2) of the Legislation Act.

75. Before turning to the question of retrospectivity, I will deal with the dispute between the parties about the meaning of "commences" and "commencement".

76. It seems to me, with respect, that the legislative history and the matters of context relied on are of little assistance in interpreting the critical word ("commences") in s 12 of the Legislation Act.

77. The expression "takes effect" has always been used in the relevant provision of what is now the AIA. Section 10 of the Acts Interpretation Act 1904-1930 (Cth), for example, provided that where an Act confers power to make regulations, all regulations made accordingly shall, unless the contrary intention appears, take effect as from the date of notification or from a later date specified in the regulations. See eg
Broadcasting Co of Australia Pty Ltd v The Commonwealth (1935) 52 CLR 52 at 60. See also s 48(1) of the AIA from 1937-1992 ("… unless the contrary intention appears, all regulations made accordingly … shall, subject to this section, take effect from the date of the notification …"), and 1992-2003 (which, in addition to the date of notification, provided for a provision to "take effect" from specified dates or times). Section 48(1) remained unchanged until it was repealed in 2003, when the Legislation Act was enacted, with s 12 adopting similar wording to s 48 of the AIA (as set out at [58]-[59] above).

78. Likewise in New South Wales, as Gageler J explained in
ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1 at 20 [46], s 39(1)(b) of the Interpretation Act 1987 (NSW) as originally enacted used the words "shall take effect". The word "commences" was substituted in 2009, not because there was any suggestion that the expression "shall take effect" and the word "commences" meant different things, but for the sake of internal consistency. And it was in that context that his Honour observed that "[t]he word 'commences' and the words 'shall take effect' have the same meaning: they refer to when legal operation begins". That statement, if I may say so with respect, was one about the ordinary meaning of words, as the context of what his Honour said in that paragraph makes clear:

Section 39(1)(a) of the Interpretation Act provides that a regulation or other statutory rule "shall be published on the NSW legislation website". Section 39(1)(b) provides that the regulation or other statutory rule "commences on the day on which it is so published or, if a later day is specified in the rule for that purpose, on the later day so specified". Section 39(1)(b) as originally enacted used the words "shall take effect". The word "commences" was substituted by amendment in 2009 to be consistent with the expression used elsewhere in the Interpretation Act in connection with Acts generally. The word "commences" and the words "shall take effect" have the same meaning: they refer to when legal operation begins.

(Footnotes omitted.)

79. The omitting of "shall take effect" and the insertion instead of "commences" in the Interpretation Act 1987 (NSW) to which Gageler J referred was effected by item 2.25 of Schedule 2 to the Statute Law (Miscellaneous Provisions) Act 2009 (NSW), the explanatory note to which read: "The proposed amendments replace references to 'take effect' with references to 'commence', which is the expression used in connection with Acts".

80. Similarly, the explanatory memorandum to the 2015 amendments to the Legislation Act explained that "[n]ew subsection 12(1) provides a broad rule to replace the detailed provisions of existing subsection 12(1), and is consistent with the commencement rule for Acts in section 3 of the Acts Interpretation Act".

81. Section 3 of the AIA was also amended at the same time. It was (and is) headed "When Acts come into operation", and prior to the amendment, read:

If an Act or a provision of an Act is expressed to come into operation on a particular day (whether the expression "come into operation" or "commence" is used), it shall come into operation

ATC 24838

immediately on the expiration of the last preceding day.

82. The form of s 3 after the 2015 amendment, being the current form, is relevantly identical:

If an Act or a provision of an Act is expressed to come into operation on a particular day (whether the expression "come into operation" or "commence" is used), it comes into operation at the start of the day.

83. Just as the explanatory memorandum said that the amendment to s 12 of the Legislation Act was "consistent" with s 3 of the AIA, it also noted that this change to s 3 was "consistent with the new s 12 of the Legislation Act".

84. There is no suggestion that use of the word "commence" was intended to work a change to the operation of the Legislation Act of the significance contended for by the Commissioner.

85. On the contrary, it seems to me quite clear that the legislature is to be taken to have regarded the expressions "come into operation", "commence" and "takes effect" as synonymous.

86. In this case therefore, in my view, the amendment to s 7(2)(e) "commenced" - in the sense that it "took effect" or "began its legal operation" - on 30 March 2020.

87. Once that is understood, it seems to me that the rest of the legislative history and the matters of context relied on are of little assistance one way or the other.

88. The Commissioner also submitted that the applicants' contention is contrary to the definition of commencement in the AIA, viz "commencement, in relation to an Act or a provision of an Act, means the time at which the Act or provision comes into operation". But that is not so, once it recognised that the issue of when a provision comes into operation is not determined by the ritual incantation of expressions like "the whole of this instrument commences immediately after it is registered", but by having regard to the whole of the instrument - which, here, contains a specific provision that certain amendments, including to s 7(2)(e), applied (in relation to JobKeeper fortnights) on or after 30 March 2020. To say otherwise, it seems to me, would be a triumph of form over substance.

89. The Commissioner's other contention was that there are "known drafting techniques" available for making a legislative instrument commence before registration and that such techniques were not adopted here. It was not made apparent what particular drafting techniques were being referred to, but in any event, I have no reason to think that the drafting technique used here - in substance, carving out for different treatment particular amendments, including those concerning the eligibility of sovereign entities - was unorthodox, or anything of the sort. Even if it were, I fail to see why that would matter.

90. I now turn to the related question of retrospective application under s 12(2) of the Legislation Act.

91. It has long been recognised that "there has been some ambiguity in the use of the word 'retrospective'". See
Coleman v Shell Co of Australia (1945) 45 SR (NSW) 27 at 30 (Jordan CJ), quoted with approval in
The Commonwealth v SCI Operations Pty Ltd (1998) 192 CLR 285 at 309 [57]. See too
Chang v Laidley Shire Council (2007) 234 CLR 1 at 32 [111] ("'Retrospectivity' is a word that is not always used with a constant meaning").

92. As Gageler J said in
ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1 at 20 [44], there are two senses in which an enactment might be said to have retrospective operation.

93. First, "a provision of a regulation [or statute] might be said to have retrospective operation if, and to the extent that, the provision is taken to have had legal operation at or from a past date". ADCO at 20 [45]. Gageler J described the potential for a provision to have retrospective operation in that way as a "straightforward temporal sense".

94. Secondly, "a provision of a regulation [or statute] might be said to have retrospective operation if, and to the extent that, the regulation operates to alter rights or liabilities which have already come into existence by operation of prior law on past events". ADCO at 21 [48]. His Honour described that second sense

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in which the word "retrospective" is used as the "substantive sense".

95. Along similar lines, Jordan CJ in
Coleman v Shell Co of Australia (1945) 45 SR (NSW) 27 at 31 distinguished between an enactment which created "further particular rights or liberties with respect to past matters or transactions", on the one hand, and one "which provided that as at a past date the law shall be taken to have been that which it is not", on the other.

96. As the parties' submissions impliedly recognised, the distinction between the two senses in which the word "retrospective" is used has significance for the operation of s 12 of the Legislation Act. Compare
ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1 at 20 [44].

97. The parties agreed that if the amendment to s 7(2)(e) was retrospective in the first sense, the applicants' rights (assuming they existed) would not be affected so as to disadvantage them within the meaning of s 12(2)(a). On the other hand, the Commissioner accepted that if the amendment was retrospective in the second, substantive sense, then assuming that as at 30 March 2020 they had accrued rights to JobKeeper payments for the relevant fortnights (the subject of question two), the applicants' rights would be affected so as to disadvantage them.

98. The applicants submitted that the Amending Instrument expressly altered the meaning of "sovereign entity" in relation to JobKeeper fortnights beginning on or after 30 March 2020, and that it altered the law so that they were taken not to be eligible employers for a period (30 March to 26 April 2020) that had already expired - and that this is not an instance of an instrument creating rights and liabilities for the future with respect to past transactions, or merely adversely affecting a pre-existing right, but rather destroyed at a past date rights which then existed (ie the status of the applicants as eligible employers).

99. The Commissioner's case was that the Amending Instrument operated so that, from 1 May 2020 onwards, further rights or liabilities with respect to past matters (eligibility as at 30 March 2020) were to be determined by the application of laws in place from 1 May 2020 onwards.

100. For reasons I have explained, in my view the amendment to 7(2)(e) was expressed to be retrospective because, although the Amending Instrument said that it commenced immediately after it was registered, on 30 May 2020 (see s 2(1)), the relevant amendment to s 7(2) "appl[ied] in relation to jobkeeper fortnights beginning on or after 30 March 2020". It thus expressed to take effect from a date prior to the date of registration of the Amending Instrument.

101. In my view, as the applicants submitted, the Amending Instrument had retrospective operation in the substantive sense, namely it operated to alter the applicants' rights as eligible employers (assuming that such rights existed) within the meaning of s 7(2), which rights, if they existed, would have come into existence by operation of prior law.

102. It was, to put it another way, a provision which had the effect that from 1 May 2020, as at and from a past date (30 March 2020), the law should be taken to be that which it was not, such that the applicants were taken not to be an eligible employer for a period that had already expired.

103. It follows, therefore, that s 12(2) of the Legislation Act is engaged.

QUESTION TWO

On the assumption that the amendment to s 7(2)(e) was retrospective, did the applicants have any "rights" which were adversely affected within the meaning of s 12(2)(a) of the Legislation Act under either of s 6 or s 7 of the JobKeeper Rules at the time that the Amending Instrument was registered?

The competing submissions

104. The parties agreed that when the term "right" is used in the context of a provision like s 12(2), it is "to be understood by reference to the statute that has been amended or repealed", and that in that context it is not used "solely in any technical sense derived exclusively from property law or analytical jurisprudence". See
Chang v Laidley Shire Council (2007) 234 CLR 1 at 34 [117]. As Keane JA (as his Honour then was) said in
Australand Corporation (Qld) Pty Ltd v Johnson [2008] 1 Qd R 203 at 242 [111]:

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Generalising from the decided cases cited by the parties, and the observations of Hayne, Heydon and Crennan JJ in the recent decision of the High Court in Chang v. Laidley Shire Council, the most important point to emerge is the proposition that s 8(c) [of the Acts Interpretation Act 1901 (Cth)] and its analogues cannot be understood without a clear understanding of the nature of the right said to have accrued under a particular statute.

105. It was also not disputed that a provision such as s 12(2) "does not preserve a power to take advantage of an enactment, and does not apply where there is merely a hope or expectation that a right might be created". See eg
Mathieson v Burton (1971) 124 CLR 1 at 23 (Gibbs J).

106. The applicants contended, however, that the Commissioner wrongly considered that, at the time of registration of the Amending Instrument, they had no more than a mere hope or expectation that a right might be created, and that they in fact had an accrued, albeit conditional, right to claim JobKeeper payments, which was sufficient. See eg
Mathieson v Burton (1971) 124 CLR 1 at 23 (Gibbs J); and
Esber v The Commonwealth (1992) 174 CLR 430 at 440-441 (Mason CJ, Deane, Toohey and Gaudron JJ).

107. Here the eligibility requirements for receiving JobKeeper payments were set out in s 6(1) of the JobKeeper Rules, which as at 1 May 2020 were:

  • (a) the fortnight was a "JobKeeper fortnight" (s 6(1)(a));
  • (b) the employer qualified for the scheme under s 7 (s 6(1)(b));
  • (c) the individual was an eligible employee for the employer for the fortnight (s 6(1)(c));
  • (d) the employer had satisfied the wage condition in respect of the employee for the fortnight (s 6(1)(d));
  • (e) the employer had notified the Commissioner in an approved form that the employer elects to participate (s 6(1)(e));
  • (f) the employer had given information about the entitlement for the fortnight, including details of the individual, to the Commissioner in the approved form (s 6(1)(f)); and
  • (g) the employer had not notified the Commissioner in the approved form that the employer no longer wishes to participate in the JobKeeper scheme (s 6(1)(g)).

108. As explained above, as at 1 May 2020, the applicants other than AHSA had satisfied all of the eligibility criteria in s 6(1), except for the notification requirement in s 6(1)(f). And AHSA had satisfied the eligibility criteria in s 6(1), except for the requirements in s 6(1)(e) and (f).

109. The applicants submitted that "[a]lthough an employer is ultimately required to meet all of the criteria in s 6(1) before it can receive a payment, that does not mean that each criterion is of equal significance" and that "[i]t is necessary to examine the role of s 6(1)(f) in the scheme". The applicants submitted that "a statutory right will be preserved notwithstanding the repeal or amendment of the statute even though the right can only be implemented by a non-discretionary decision of an official or a court, provided that the statutory machinery for obtaining that decision has been set in train before the repeal or amendment", citing
NSW Aboriginal Land Council v Minister Administering Crown Lands (Consolidation) Act & Western Lands Act (1988) 14 NSWLR 685 at 696 (Hope JA and Samuels and Clarke JJA agreeing).

110. The applicants submitted that "the requirement in s 6(1)(f) is a notification, which happens only after an employer company has complied with the other requirements of s 6(1)" and that "[t]he making of payments, on notice to the Commissioner, by a qualified employer to eligible employees of an amount of salary and wages meeting the statutory threshold, is sufficient to create a right, albeit a conditional right". The submission continued:

In this case, that conditional right was preserved, because the statutory process was set in train before the amendment to s 7(2)(e), by the [applicants] making application[s] to the Commissioner and paying salary and wages in accordance with the JobKeeper Rules. The [applicants] had before the registration of the Amending Instrument taken the necessary steps to crystallise the

ATC 24841

right in question. The final step required by s 6(1)(f) merely confirmed to the Commissioner the previous steps that the [applicants] had already taken.

Section 14(3) of the JobKeeper Rules (which sets out a transitional rule for the First and Second JobKeeper Fortnights) provides some indication of the secondary or ancillary nature of s 6(1)(f). By s 14(3), the Commissioner could pay an entity a JobKeeper payment for the first or second JobKeeper fortnight "without being satisfied that the entity is entitled under section 6 or section 11" to the payment if the entity had applied in the approved form, and the Commissioner was satisfied on the basis of information in that form that it was reasonable in the circumstances to pay the JobKeeper payment. This facility in s 14(3) expressly contemplated that there might be late reporting by an employer in the first two fortnights.

Of course, the notification requirement in s 6(1)(f) does perform a role in the scheme; for example, by ensuring that there is not another entity which claims to be entitled to claim the allowance for that individual (s 6(3)). However, that compliance role for s 6(1)(f) does not suggest that it is essential to the creation of an accrued right to begin with. There was nothing discretionary or evaluative about the s 6(1)(f) requirement - as with Maguire, the [a]pplicants had a contingent entitlement to a benefit, provided they took all appropriate steps by way of notice.

(Footnotes omitted.)

111. The reference to Maguire in that passage from the applicants' written submissions is to the decision of the Court of Appeal in
Chief Adjudication Officer v Maguire [1999] 1 WLR 1778 (Simon Brown, Waller and Clarke LJJ), which the applicants said was "a closely analogous case on the facts" to these cases. I deal with the case below.

112. As for AHSA, which in addition had not complied with s 6(1)(e) as at 1 May 2020, it submitted that the requirement in s 6(1)(e) was not an application, but was similarly "merely a notification" by the employer of their election to participate in the JobKeeper scheme. It was next submitted that s 6(2)(a) extended the period for complying with s 6(1)(e) in relation to the first relevant fortnight to the end of the second relevant fortnight, and the Commissioner extended the time for giving an approval to 28 May 2020. It was submitted that, accordingly, the notification requirement in s 6(1)(e) "was not a necessary step in creating a conditional right to a payment".

113. The Commissioner accepted that there are many cases where courts have considered applications for entitlements made under enactments of various types, but which had not been considered or determined prior to the repeal of the enactments. A number of such cases, which involved consideration of s 8(c) of the AIA and its State analogues, are summarised by Bathurst CJ in
In the Matter of Richards Contracting Co Management Pty Ltd (2021) 104 NSWLR 385 at 408-414 [89]-[102].

114. The Commissioner submitted, however, that cases in which it has been said that a statutory process has been "set in train" are irrelevant to these proceedings, because the provision of the information specified in s 6(1)(f) (and the notification specified in s 6(1)(e)) are substantive eligibility requirements which, if not satisfied, resulted in the applicant not being entitled to JobKeeper payments. The Commissioner relied, in particular, on the express terms of s 6, namely "[a]n entity (the employer) is entitled to a JobKeeper payment for an individual for a fortnight if …" The Commissioner submitted that those words meant no more and no less than they say, so that if the employer had not provided the information under s 6(1)(e) or the notification under s 6(1)(f) to the Commissioner by 1 May 2020, it is not entitled to a JobKeeper payment for the relevant fortnights - and thus cannot be said to have an accrued right to such a payment. In other words, as the Commissioner put it, "satisfaction of one or more requirements in s 6(1) is not properly characterised as a step towards assertion of an accrued right, but as a step towards accruing the right in the first place".

115. The Commissioner rejected the applicants' submission that the criteria in s 6 are not of equal significance, and that their contention "that s 6(1)(f) is not 'essential

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to the creation of an accrued right to begin with' … amounts to a contention that s 6(1)(f) is not a necessary condition for eligibility", and is at odds with the plain meaning of s 6. He also submitted that s 6(1)(f) "is not some mere procedural step confirming what has already come to [his] attention", and that the information given to the Commissioner in the approved form for the purposes of s 6(1)(f) can, and did in the case of some of the applicants, differ from the information previously provided under s 6(1)(e). For example:
  • (a) ACS said in its JobKeeper Enrolment Form that 689 employees had been or would be paid within each relevant fortnight. It later claimed payment in respect of 687 employees for each relevant fortnight in its JobKeeper Application Form.
  • (b) AFS said in its JobKeeper Enrolment Form that 1,499 employees had been or would be paid within each relevant fortnight. It later claimed payment in respect of 1,465 and 632 employees for the first and second fortnights respectively in its JobKeeper Application Form.
  • (c) DAS said in its JobKeeper Enrolment Form that 1,705 employees had been or would be paid within each relevant fortnight. It later claimed payment in respect of 1,696 and 1,694 employees for the first and second fortnights respectively in its JobKeeper Application Form.
  • (d) Dnata said in its JobKeeper Enrolment Form that 119 employees had been or would be paid within the second fortnight. It later claimed payment in respect of 118 employees in its JobKeeper Application Form.
  • (e) ELRA said in its JobKeeper Enrolment Form that 219 employees had been or would be paid within each relevant fortnight. It later claimed payment in respect of 218 and 109 employees for the first and second fortnights respectively in its JobKeeper Application Form.
  • (f) SFPL said in its JobKeeper Enrolment Form that 168 employees had been or would be paid within each relevant fortnight. It later claimed payment in respect of 163 and 102 employees for the first and second fortnights respectively in its JobKeeper Application Form.

116. The Commissioner also submitted that s 14(3) of the JobKeeper Rules has no bearing on the point, because all that it shows "is that there was another pathway to the making of JobKeeper payments".

Consideration of question two

117. In my view, the Commissioner's contention that the applicants did not have accrued rights must be accepted.

118. First, it is critical to begin the relevant analysis with the relevant words of s 6 - not with an analysis of cases that involve disparate provisions contained in other enactments, or with turns of phrase that are used to describe part of such analysis.

119. Here, s 6 on its face provides that no entitlement to a JobKeeper payment existed unless and until each of the seven separate criteria had been fulfilled by the relevant date (30 March 2020).

120. Section 6, which also in s 6(1)(b) picks up s 7, does not, with respect, suggest that those criteria should involve a court reading into them different degrees of "significance". There is nothing in the text of the JobKeeper Rules or the JobKeeper Act, or the legislative history, that would warrant a court embarking on such an exercise.

121. The applicants' contention to the contrary relied in particular on the decision of the Court of Appeal in
Chief Adjudication Officer v Maguire [1999] 1 WLR 1778. They contended that it supported the proposition that although the "notification requirement" in s 6(1)(f) performs a role in the scheme, for example, by ensuring that there is not another entity which claims to be entitled to the allowance for that individual, "that compliance role … does not suggest that it is essential to the creation of an accrued right to begin with" because "[t]here was nothing discretionary or evaluative about the s 6(1)(f) requirement - as with Maguire, the [a]pplicants had a contingent entitlement to a benefit, provided they took all appropriate steps by way of notice".

122. The applicants also relied on
NSW Aboriginal Land Council v Minister Administering Crown Lands (Consolidation) Act & Western Lands Act (1988) 14 NSWLR 685 for the proposition that their conditional right to JobKeeper payments for the two relevant fortnights was preserved "because the statutory process was set in train".

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123. Maguire was a case about whether the claimant was entitled to a special hardship allowance under s 60 of the Social Security Act 1975 (UK) after its repeal.

124. The question raised by the appeal was whether the claimant had an acquired or accrued right under s 16(1)(c) of the Interpretation Act 1978 (UK), when before the repeal of s 60, he had satisfied all the preconditions to entitlement to the hardship allowance, save only that of making the requisite claim, such claim then being made within the prescribed period, albeit after repeal. See
[1999] 1 WLR at 1779H.

125. Section 57(1) of the Social Security Act 1975 (UK) provided that if an employee was disabled as specified, he "shall be entitled to disablement benefit". Section 60(1) provided that if the result of the disability was as specified, "the weekly rate of a disability pension shall … be increased" as specified.

126. Section 79(1) provided that "it shall be a condition of a person's right to any benefit that he makes a claim for it in the prescribed manner and within the prescribed time".

127. In 1984, the House of Lords had held that s 79(1) went to a person's right to be paid the benefit, and not to his or her entitlement to it. See
Insurance Officer v McCaffrey [1984] 1 WLR 1353.

128. Section 79(1) was then replaced by s 165A which provided: "(1) … no person shall be entitled to any benefit unless, in addition to any other conditions relating to that benefit being satisfied - (a) he makes a claim for it - (i) in the prescribed manner; and (ii) subject to subsection (2) below within the prescribed time …"

129. Curiously, counsel for the appellant in Maguire did not "contend that his argument under section 16 [was] in any way stronger because of the replacement of section 79 by section 165A in the Act of 1975. That amendment was made for purely technical reasons - as to what constitutes an 'entitlement' for social security purposes - to overcome
Insurance Officer v McCaffrey [1984] 1 WLR 1353. Under both regimes a claim was required before payment of benefit could be made". See
[1999] 1 WLR at 1787D.

130. In any event, after reviewing the cases, Simon Brown LJ, with whom Waller and Clarke LJJ relevantly agreed, held that "[w]hat to my mind all these cases establish is essentially this: that whether or not there is an acquired right depends upon whether at the date of repeal the claimant has an entitlement (at least contingent) to money or other certain benefit receivable by him, provided only that he takes all appropriate steps by way of notices and/or claims thereafter". See
[1999] 1 WLR at 1788F.

131. But as the cases make clear, whether that is so or not in any given case will depend on the terms of the enactment. In Maguire, both before and after the amendment, the making or notifying of a claim for the benefit went only to a claimant's right to be paid the benefit, and not to their "entitlement" to it. In these proceedings, to the contrary, an "entitlement" to a JobKeeper payment only arose "if" each of the criteria was satisfied. In my view, the reasoning in Maguire is thus of no avail to the applicants.

132. The fact that an application is "set in train" is equally inapposite. But in any event, in using that phrase, Hope JA did not intend it to be a substitute for the detailed analysis of the relevant legislation and the cases elsewhere carried out in his Honour's reasons. See
NSW Aboriginal Land Council v Minister Administering the Crown Lands (Consolidation) Act and the Western Lands Act (1988) 14 NSWLR 685 at 687-696.

133. In my view, for the reasons that I have given, the applicants had no right of any relevant kind as at 30 March 2020, because as at that date, they were not "entitled" under s 6(1) of the JobKeeper Rules to JobKeeper payments for the relevant fortnights. The applicants also relied on s 7, but as s 6(1)(b) makes clear, because it picks up s 7, eligibility under s 7 is but one of the pre-requisites for eligibility under s 6. As I have explained, unless each criterion is satisfied or met, then the applicants' "rights as at that day" would not be

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"affected so as to disadvantage" them within the meaning of s 12(2) of the Legislation Act.

134. For those reasons, I answer question two, no.

QUESTION THREE

Is the Amending Instrument ultra vires the instrument-making power in s 20 of the JobKeeper Act?

135. The applicants' contention with respect to question three was said only to arise if the Commissioner's contention about the meaning of the word "commence" in s 12(2) of the Legislation Act was accepted. That is so because if the applicants' contention is accepted, and "commence" in s 12(1A) means "take effect", then the applicants accept that s 12(1A) authorises a retrospective instrument.

136. The submission was put this way:

The intended purpose of s 12(1A) was to "clarif[y] that a legislative instrument or notifiable instrument may provide that the instrument or a provision of the instrument can commence retrospectively, despite any principle or rule of common law". Yet on the Commissioner's interpretation of "commence", s 12(1A) would not apply to, and therefore would not authorise, the retrospective application of the Amending Instrument in this case.

137. Because I reject the Commissioner's contention on the meaning of "commence", the applicants' contention that the JobKeeper Act does not confer any authority (separate from s 12(1A)) for making rules that amend the eligibility for JobKeeper payments with retrospective effect does not arise.

138. Were it necessary to decide the point, however, I would hold that s 20(1) of the JobKeeper Act does confer authority for making rules that amend the eligibility for JobKeeper payments with retrospective effect, because although the JobKeeper Act does not expressly confer that authority, the text, context and purpose of the legislation makes tolerably clear that it was intended that such retrospective rules were to be allowed. Compare
ADCO Constructions Pty Ltd v Goudappel (2014) 254 CLR 1 at 15-16 [28] (French CJ, Crennan, Kiefel and Keane JJ) ("… it was argued that it was for ADCO to search for express text that displayed an intention to adversely impact on accrued rights. The appropriate enquiry in the construction of delegated legislation is directed to the text, context and purpose of the regulation, the discernment of relevant constructional choices, if they exist, and the determination of the construction that, according to established rules of interpretation, best serves the statutory purpose").

139. Section 20(1) of the JobKeeper Act provided:

20 Rules

Power to make rules

  • (1) The Treasurer may, by legislative instrument, make rules prescribing matters:
    • (a) required or permitted by this Act to be prescribed by the rules; or
    • (b) necessary or convenient to be prescribed for carrying out or giving effect to this Act.

140. At the relevant time, s 7 of the JobKeeper Act provided:

7 Coronavirus economic response payments

  • (1) The rules may make provision for and in relation to:
    • (a) one or more kinds of payments by the Commonwealth to an entity in respect of a time that occurs during the prescribed period; and
    • (b) the establishment of a scheme providing for matters relating to one or more of those payments, and matters relating to such a scheme.

      Paragraphs (a) and (b) do not limit each other.

  • (2) Without limiting subsection (1), the rules may make provision for and in relation to the following matters:
    • (a) the eligibility criteria for a payment;
    • (b) if or how an application for a payment may or must be made;
    • (c) whether a payment is to be paid in instalments or as a lump sum;
    • (d) entitlement to a payment or an instalment of a payment;

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    • (e) the amount of a payment or an instalment of a payment;
    • (f) when a payment or an instalment of a payment is payable;
    • (g) conditions applying to a payment or an instalment of a payment;
    • (h) providing information or notices;
    • (i) rights, obligations or liabilities of:
      • (i) an entity that is paid a payment; or
      • (ii) an entity that directly benefits from another entity being paid a payment; or
      • (iii) if the entitlement of an entity to a payment relates to a relationship existing between the entity and another entity-the other entity.

      Paragraphs (a) to (i) do not limit each other.

141. As the Commissioner submitted, and I agree, the breadth of the subject matters with which rules could deal under s 7, together with the breadth of the language of the power in s 20, support a conclusion that rules can be made with retrospective effect.

142. And as Mr Tran put it in his oral submission on the point:

When dealing with public money in responding to a once in a lifetime event, it is, we say, entirely improbable that the Parliament intended to confine the Treasurer to prospective rules. Such a limitation would, for example, discourage the Treasurer from acting promptly for fear of locking in rules that couldn't be retrospectively tweaked if error in their implementation were revealed. That would lock away public funds in a way that could only be modified prospectively if [the applicants'] argument were correct. To the contrary, responses may evolve in the light of experience.

Initial attempts to implement government policy may misfire. Experience may reveal that tweaks are needed. The more probable inference from the subject matter of section 20 and the subject matter of this Act is that the Parliament intended to maximise flexibility and responsiveness, which extends to the making of retrospective rules.

143. For those reasons, if it had been necessary to decide the point, I would have found that the JobKeeper Act does confer authority for making rules that amend the eligibility for JobKeeper payments with substantive retrospective effect.

DISPOSITION

144. It follows that each of the appeals will be dismissed, with costs.

THE COURT ORDERS THAT:

  • 1. Each of the appeals is dismissed.
  • 2. The applicant in each proceeding pay the respondent's costs.

Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.


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