Retrospective legislation and the rule of law
F A Hayek neatly summarises the rule of law as follows:
Stripped of all technicalities [the rule of law] means the government in all its actions is bound by rules fixed and announced beforehand — rules which make it possible to foresee with fair certainty how the authority will use its coercive powers in given circumstances, and to plan one’s affairs on the basis of this knowledge. (Road to Serfdom, 1944)
Fundamentally, people must know what the law is so they can abide by it. It is for this reason that Joseph Raz says that the first principle of the rule of law is that “All laws should be prospective, open and clear” (‘The Rule of Law and its Virtue’ (1977) 93 LQR 195 at 198). A person cannot be guided by a law which did not exist at the time when the action occurred. It is fundamentally unfair to hold a person to be in contravention of the law when that law did not exist when the alleged contravention occurred. It is also worth noting that Raz’s principle number three of the rule of law is that “The making of particular laws (particular legal orders) should be guided by open, stable, clear and general rules.”
The Australian legal perspective on retrospective legislative enactments
There is no provision prohibiting the enactment of retrospective legislation in the Australian Constitution. By contrast, the US Constitution provides that both the Federal government and the State governments are prohibited from passing ex post facto laws (Article I, section 9 and section 10 respectively).
The Australian Parliament’s Legislation Handbook, which provides recommendations for legislative procedure, suggests the following with regard to retrospective legislation at [6.18]:
Provisions that have a retrospective operation adversely affecting rights or imposing liabilities are to be included only in exceptional circumstances and on explicit policy authority (see sub-paragraphs 4.7(g) and 4.17(c), and paragraph 8.19). (See also paragraphs 4.24 to 4.27 concerning announcement of legislation to operate from the date of announcement.)
Previously the Federal government has enacted retrospective taxation laws, including the ‘bottom of the harbour tax laws‘ passed in 1982. Ken Parish has also reminded me that the High Court upheld retrospective war crimes legislation in Polyukhovich v Commonwealth (1991) 172 CLR 501.
Two recent retrospective legislative enactments by the Federal government
There have been two recent instances where the Australian Federal government has enacted or attempted to enact retrospective legislation. Not only has the government enacted or attempted to enact retrospective legislation in these instances, it has done so while cases involving the very issues dealt with in the legislation were being heard before the courts and the Government was a party to those cases.
The Poniatowska case
Recently, a South Australian woman named Malgorzata Poniatowska was convicted of welfare fraud, and while she pleaded guilty, she challenged the validity of the conviction in court. As Adelaide Now reports here:
In 2009 she was convicted of defrauding Centrelink, after pleading guilty to receiving more than $20,000 in sole parent benefits that she was not entitled to while receiving commissions from Hickinbotham. She received a 21-month jail sentence, suspended, on condition she enter a two-year bond.
She appealed against her sentence – first to the Supreme Court, which upheld it, then to the Full Court of the Supreme Court, which last year set aside her conviction.
It ruled her “omission” to report the benefits while receiving commission payments from Hickinbotham was not a crime.
On 26 October 2011, a majority of the High Court of Australia upheld the decision of the Full Court in Commonwealth Director of Public Prosecutions v Poniatowska  HCA 43 on the basis that the relevant offence could not be committed by an omission to act (i.e. the failure of Poniatowska to update Centrelink as to her circumstances).
But it was too late. On 4 August 2011, after the hearing of the case, and prior to the High Court handing down its decision, the Federal Government amended the Social Security (Administration) Act 1999 (Cth) to insert a new s 66A. Section 66A provides that there is a general positive requirement to inform Centrelink of changes in circumstance. The Act introducing the new provision, the Social Security and Other Legislation Amendement (Miscellaneous Measures Act 2001 (Cth) makes it clear in Schedule 1, item 3 that the provision is to act retrospectively and applies to a change in circumstance which occurs on or after 20 March 2000. Consequently, Ms Poniatowska’s victory was a Pyrrhic one.
Interestingly, Heydon J, who dissents in DPP v Poniatowska notes acidly at :
It is common for the decisions of courts to be reversed by the legislature after they have been delivered. It is less common for this to take place even before they have been delivered. Yet the legislature has got its retaliation in first in relation to this appeal. In those circumstances it is desirable that this dissenting judgment be as brief as possible.
Do you suspect that he considers that the legislation is an instance of poor form by the Federal Government?
The Payara case
An Indonesian man, Jeky Payara, was charged with aggravated people smuggling pursuant to s 233C of the Migration Act 1958 (Cth) after he was accused of carrying 49 asylum seekers to Christmas Island in September 2010. In August this year, Payara sought to challenge the law on the basis that be argued was he was legally entitled to assist genuine refugees to reach Australia. He pleaded not guilty, and has not yet been convicted of any offence. The matter was referred to the Victorian Court of Appeal.
However, on 1 November 2011, the Federal Government hastily passed the Deterring People Smuggling Bill 2011 through the House of Representatives, with the support of the Federal Opposition (bipartisan support is a rare sight in these days). As with the previous Act, this Bill is intended to operate retrospectively (the new s 228B is to operate from 16 December 1999). Consequently the Age reports that Victorian Legal Aid, who was acting for Mr Payara, were forced to adjourn the proceedings before the Victorian Court of Appeal to await to see whether the legislation will successfully pass the Senate. With bipartisan support in the House of Representatives, it is difficult to see any obstacles to the legislation passing through the Senate.
I am concerned by this recent tendency to attempt retrospective legislation, particularly when the disputes governed by the legislation are still being determined by the courts , and where the government is a party to the actions before the courts. I am deeply disappointed by the Federal government in so many ways.
Regardless of what one thinks of the individual merits of Ms Poniatowska’s or Mr Payara’s cases, surely it can be seen that in principle, retrospective legislation is generally inappropriate in a country which seeks to uphold the rule of law, and should be avoided in all but the most serious circumstances.
There is a real argument in any case that the government is picking on “easy victims” – by construing the legislation as a victory against ‘welfare cheats’ and ‘people smugglers’, it is as if the government is saying, “Ah, but it is okay to be retrospective against those kind of people.” As this article by Popple notes, even the Nuremberg trials were controversial on the basis of their retrospective operation, and the wrongdoing in those trials were surely of an infinitely greater magnitude than these.
Consequently, I believe that principled individuals on all sides of politics should be wary of legislation such as the instruments described in this post. We do not want to make a habit of such legislation every time a badly drafted statute leaves a loophole.
Please do look at this post by Ken Parish which outlines the complexities of Polyukhovich and possible ways of challenging the constitutionality of the Deterring People Smugglers Act if it is passed. I concur with Ken’s view of prosecuting people smugglers in these circumstances – Payara, for example, is a 20 year old Indonesian fisherman who crewed the boat; he’s not a people smuggling king pin. And it appears that the sentence for “aggravated people smuggling” is mandatory. Bad stuff: dare I suggest they’re prosecuting people like Payara just to look like they are doing something to “stop the boats”?