Chaff and Hay Acquisition Committee v J A Hemphill and Sons Pty Ltd

[1947] HCA 20

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(Judgment by: McTiernan J)

Chaff and Hay Acquisition Committee
vJ A Hemphill and Sons Pty Ltd

Court:

Judges: Latham CJ
Starke J

McTiernan JWilliams J

Hearing date: 2 May 1947, 5 May 1947
Judgment date: 12 June 1947

Melbourne

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Judgment by:
McTiernan J

The defendant in this action is described in the writ as the Chaff and Hay Acquisition Committee. This is the name given by the Chaff and Hay (Acquisition) Act 1944 of South Australia to the committee, which it constitutes. The question to be decided is whether the committee can be sued by that name in the Supreme Court of New South Wales. The committee cannot be sued by that name unless it is a legal personality. The courts of one country give recognition, by a comity of nations, to a legal personality created by the law of another country. The Act does not expressly incorporate the committee. There is no indication of an intention to incorporate it given by the words of the Act. The committee is competent to discharge its duties and exercise its powers under the Act without the aid of the status of a corporation. It follows from these considerations that the committee is not a corporation (Conserva-tors of the River Tone v. Ash ^[23] ; Mackenzie-Kennedy v. Air Council ^[24] ; Borough of Salford v. Lancashire County Council ^[25] ). The Act says that the committee shall consist of four members to be appointed by the Gover-nor of South Australia upon the recommendation of the Minister of the Crown to whom he commits the administra-tion of the Act. Section 3 (4) says that the committee shall be deemed to be an instrumentality of the Crown. The Chaff and Hay Acquisition Committee is therefore nothing else than the name of a group of four natural persons carrying out certain duties for the Crown. In Mackenzie-Kennedy v. Air Council ^[26] Lord Atkin said: "But, unless incorporated, the Air Council is but a name for several important officials, who have administrative duties assigned to them on behalf of the Crown" ^[27] . If the committee is nothing more in the eye of the law than an unincorporated body of persons it is, of course, not a legal personality: and recognition ought not to be given to it as a legal person-ality in the Courts of New South Wales.

There is an alternative argument that the committee is a persona juridica other than a corporation. Parliament can create a legal personality of any type. It is another question whether any legal personality which the legislature of one country pleased to create would be recognized in the courts of another country as a legal personality. In National Union of General & Municipal Workers v. Gillian ^[28] , there is a statement by Scott L.J. illustrating the range of artificial legal persons which could be created by Act of Parliament: "There is a tertium quid. A trade union has many activities; it has some existence: and it is something. The omission of Parliament to christen it with some new generic name is immaterial; for Parliament has absolute sovereignty and can make new legal creatures if it likes. It is able, for instance, to create a persona juridica not previously known to law if it so chooses; or to clothe an existing association of natural persons with what I may call co-operative personality, so as to give it the status of a persona juridica. In my view, that is just what it did in 1871. It expressly assumed the possession by every trade union, when duly registered, of so many of the main attributes of judicial personality that I find any other inference of the inten-tion of Parliament impossible" ^[29] . The test of the sufficiency of the expression of legislative intention to create a corporation is, in reason, applicable to determine whether an Act creates any legal personality other than a corpora-tion. The intention which it is necessary to find in the words of this Act, is to make the four members of this com-mittee the corpus or substratum of a new legal personality other than a corporation. The intention to invest the com-mittee as a body with the status of a corporation is not evident in the Act. I am unable to find in the words of the Act the intention to constitute, besides the visible committee consisting of the four members appointed by the Governor, a fictitious person also called "the committee." It was not necessary for the legislature to invest the committee with the status of artificial legal personality to make the Act work. The committee is not constituted to stand over against the members of the committee as an incorporated company stands over against its shareholders. The Act confers powers upon the committee and also empowers a member of the committee to do certain things. For example, the power of compulsory acquisition is conferred upon the committee: the power to purchase is conferred upon any member of the committee. The intention of the legislature is that in one case the power should be exercised by the four members of the committee collectively or by as many of them as would be a quorum, and in the other case that the power should be exercised by one of those visible persons. The members of the committee do not exercise the powers conferred upon "the committee" as the executants of a legal personality called the Chaff and Hay Acquisi-tion Committee: they exercise those powers in their own right. They do not stand in the position of directors of a quasi-corporate "committee" of which they are also members. The four members of the committee are collectively the instrumentality of the Crown. They are not appointed to act as agents of some new persona juridica. If the Act did not otherwise provide, any chaff or hay purchased or acquired would vest in and become the property of the Crown. Section 5 (2) says that upon purchase or acquisition the chaff or hay "shall vest absolutely in the committee and shall, subject to any disposition thereof made by the committee under this Act, be and remain the property of the committee for the purposes of this Act." This provision gives the committee the rights of property in the chaff and hay acquired or purchased pending its distribution under the Act. It does not warrant the conclusion that the commit-tee is by implication a legal personality. The provision vests the chaff and hay in and gives the rights of property to the four members collectively. They become trustees for the Crown of the chaff and hay for the purposes of the Act. Section 5 (2) does not raise any question of whether there is a quasi-corporation or a different legal entity from the members of the committee. This provision vests the property only in the persons of whom the committee consists and creates rights of property only in those persons. It is not necessary that the committee should be a legal personal-ity to avoid the transmission of any legal interest of a member of the committee. That result is avoided by the terms of the section. If a member dies or the appointment of a member terminates, he would cease to be a member of the class to which s. 5 (2) applies. The vesting and rights of property brought about and conferred by s. 5 (2) depend upon membership of the committee. It operates to vest property in and to give rights of property to the persons who are from time to time the members of the committee. Although the committee has not permanent legal unity like a corporation, s. 5 (2) gives the committee in respect of the ownership of property the advantages of a corporation: the Parliament can do this without making the committee a persona juridica of any kind. Section 14 regulates proceed-ings with respect to matters arising out of the Act. The committee is an instrumentality of the Crown: a member is also in that position when exercising any powers conferred upon him by the Act. Proceedings by or against the committee or a member, in such a case, are really proceedings by or against the Crown. In the absence of s. 14 such proceedings would need to be taken in the way in which the Crown sues or is sued in South Australia. Section 14 (1) provides that with respect to matters arising out of the Act all legal proceedings by the committee are to be com-menced in the name of the committee and all legal proceedings against the committee or any member are to be insti-tuted in the name of the committee. The effect of s. 14 (1) is that the committee is empowered in proceedings arising out of the Act to represent the Crown either as plaintiff or defendant. In the former case they displace the Attorney-General: in the latter case the committee act as a nominal defendant: s. 14 (1) supplants the procedure of petition of right. Section 14 (1) lends no support to the argument that the committee is an artificial person. The object of this provision is not to make the liability of the committee separate from the liability of the members of the committee. There is here no analogy to the position of a company vis-a-vis its members. Further, s. 14 (1) does not authorize proceedings which bind any assets of the committee. Section 14 (2) says that the Treasurer of South Australia shall, from the moneys appropriated for the purposes of the Act, satisfy all orders made by any court against the commit-tee in any such legal proceedings. This provision demonstrates that s. 14 (1) makes the committee a nominal plain-tiff or defendant for the Crown. It follows that the committee cannot be sued or sue by the name of the Chaff and Hay Acquisition Committee by virtue of a status of a corporate or quasi-corporate character. They can sue or be sued because they are given a statutory right to represent the Crown in proceedings arising out of the Act. Section 14 (1) is procedural: it gives no title to the Chaff and Hay Acquisition Committee to be recognized in the Courts of New South Wales as a legal personality. Section 14 (3) gives the committee and any member of the committee im-munity from liability for anything done bona fide under the Act. This immunity is conferred upon the committee as a number of officials: not upon an artificial personality. The Chaff and Hay Acquisition Committee is a name only for four officials: it is not also a name given by the Act to a fictitious person. There is no ownership or liability of the committee separate from an ownership or liability of the members who compose the committee in their official capacity. I am of opinion that the Chaff and Hay Acquisition Committee is not a corporation or other legal personal-ity: that it is but a name for an unincorporated body: and that an action cannot be brought in New South Wales against a defendant described as the Chaff and Hay Acquisition Committee. I should allow the appeal.