Shaky Foundations

August 27, 2012

Some readers may be aware that there is litigation on foot between the Commonwealth and a number of (initially 58, but now down to “30-odd”) Federal Magistrates in respect of their entitlement to a judicial pension.  I came to know of this case as there were a number of (unsuccessful) applications made to have Magistrates disqualify themselves on the basis of bias as a result of the proceedings (eg Bank of WA v Srinivasan [2012] FMCA 177 where Smith FM, who is not an applicant didn’t recuse himself and proceeded to make a sequestration order).

This issue goes way beyond “pay dispute” and there is the potential for a finding that the whole Federal Magistrate’s Court is constitutionally invalid. In Conlan as Trustee of Two Bankrupt Estates [2011] FMCA 849 Lucev FM,set out the possibilities by reference to Hansard on 11 October 2011:

In any event, on the applicants’ [that is the 58 federal magistrates] pleaded case, it seems to us that one of three possible outcomes may follow as a result.

(a) The structure of the Federal Magistrates Court is deficient because it does not expressly provide for a life-long guaranteed pension for federal magistrates with the consequence that the Federal Magistrates Act 1999 (Cth) is invalid.

(b) If not (a), the federal magistrates’ appointments are constitutionally infirm (and always have been) because of incompatibility with the requirements of Chapter III. This outcome assumes the Federal Magistrates Act is valid because, properly construed, it provides a mechanism either for the Remuneration Tribunal or the Governor-General to determine that federal magistrates be provided with a life-long guaranteed pension.

(c) If not (b), then although the magistrates’ appointments are not invalid, they could not (and still could not) validly exercise Commonwealth judicial power unless first provided with a life-long guaranteed judicial pension.

Because of the seriousness of the issues the matter was heard at first instance by a Full Court (Keane CJ, Lander and Perram JJ) in Sydney on 9 August. Judgment is reserved, but watch out for the decision in Baker & Ors v Commonwealth.

Creative commons acknowledgment for the photograph.

POSTSCRIPT:

The Full Court published its judgment on 31 August 2012. The Applicants are not entitled to a pension and the Court remains on firm (not shaky) foundations.

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