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Where am I now? Lawlink > Law Reform Commission > Publications > Section 13 - The Application Of Statutes To The Crown 45
Report 24 Outline (1975) - Proceedings By And Against The Crown
Section 13 - The Application Of Statutes To The Crown 45
We have noted, in Section 6 of this outline, that we have considered, and have found to be unsatisfactory, the law which the courts apply in deciding whether an Act, or a particular provision of an Act, binds the Crown. 46
The law is this 47 - if the Act expressly provides that the Act, or provision of it, binds the Crown, the Crown is bound; but if the Act does not so provide there is a presumption that the Crown is not bound even though the provisions of the Act, or the provision in question are expressed generally and are literally every bit as applicable to the Crown as they are to subjects. “This presumption is rebutted where it is a “necessary”inference that it was intended that the Crown be bound. This inference can be drawn if the purpose of the Act, or provision of it, would be “wholly frustrated”, unless the Crown were bound. It may be taken that general legislation which is as basic to general transactions as is the Sale of Goods Act, 1923, will be construed as binding upon the Crown notwithstanding that it does not expressly state that the Crown is bound by it. Why, it may be asked, would the purpose of the Sale of Goods Act, 1923, be wholly frustrated if that Act did not bind the Crown? The answer may be this. It is of fundamental importance in the conduct of commercial affairs that there be uniform rules of law binding upon all parties to a contract for the sale of goods. An exception in favour of the
The purpose of the Act must Crown would destroy the uniformity. The purpose of the act must be taken to be the prescription of standard rules applicable to all contracts for the sale of goods. Exception of the Crown, therefore, would wholly frustrate this purpose of achieving uniformity. But if this be the explanation, the test of total frustration is otiose. For one has answered the question whether it is intended that the Crown be bound by the very first step in the reasoning - namely that it is intended that the standard rules laid down by the Act are to apply to all contracts for the sale of goods. The test of total frustration may conceal, rather than elucidate, the considerations which influence the courts. But one thing is clear. It is that it is far from easy to persuade the courts that it is a necessary inference that it was intended that the Crown be bound. Relatively little legislation is of the character of the Sale of Goods Act, 1923. In general, where legislation does not expressly state that the Crown is bound, the presumption that it is not bound is almost irrebuttable. It is not enough that the provisions are expressed in general terms, without any statement that the Crown is to be exempt, and that the provisions are “manifestly intended to secure the public welfare”. For the Privy Council 48 has declared that “every statute must be supposed to be for ‘the public good’, at least in intention”. Thus, in Downs v. Williams 49 the High Court held that notwithstanding that the Factories, Shops and Industries Act, 1962, provides in general terms that the occupiers of factories shall fence dangerous machinery, and notwithstanding that the beneficent purpose of the provision is that workers be protected from injury, the Crown is not bound by that provision.
It would seem that Parliamentarians have assumed, on many occasions, that the legislation would be construed bv the courts as binding on the Crown whereas, in fact, it has not bound the Crown. 50 As we have already pointed out, debate on the Factories, shops and Industries Act, 1962, suggests strongly that this was the case in respect of the statutory duty to fence dangerous machinery. In respect of other legislation amendments subsequently made suggest that, at the time when the original legislation was enacted, it was not appreciated that the Crown would not be bound (or, at least, that it would be doubtful whether the Crown was bound). 51 Two examples suffice. The Compensation to Relatives Act, 1897, which provides for the recovery by dependent members of the family of a person wrongfully killed of damages for their financial loss, was not expressed to bind the Crown. In 1928 the Act was amended to provide expressly that the Crown is bound by it. Likewise the Scaffolding and Lifts Act, 1912, was not expressed to bind the Crown. In 1948 the Act was amended to provide expressly that the Crown is bound by it. It is not surprising that Parliamentarians have assumed, wrongly, that the courts would be far readier than in fact they are to infer that an Act, expressed in language as apt to apply to the Crown as it is apt to apply to subjects, is meant to bind the Crown. The law does not, in this regard, accord with the reasonable expectation of those not versed in its subtleties. Injustice to subjects has ensued. The law should be reformed.
The substance of our recommendations for reform is this. The presumption that it is not intended that the Crown be bound by a legislative provision unless either it is expressly stated that the Crown is to be bound or it is a necessary inference that it is intended that the Crown be bound should be abolished. In place of this presumption legislation should be enacted to the effect that where, but for the former presumption, a legislative provision would bind the Crown, it shall be construed as binding the Crown except in so far as it is unlikely that it would have been intended that it bind the Crown having regard to -
(a) the foreseeable extent to which the provision, if binding the Crown, might impede it in any activity and the foreseeable extent to which that impediment might be against the public interest;
(b) the foreseeable extent to which the provision, if binding the Crown, might burden it in respect of any property and the foreseeable severity of that burden as compared with the burden upon other persons, bound by the provision in respect of any property; and
(c) the foreseeable extent to which the purpose or any of the purposes of the provision might fail if the crown were not bound and the foreseeable extent to which that failure might be against the public interest. 52
In short, the Crown should be bound unless, having regard to these matters, the reasonable inference is that it is unlikely that it would have been intended that the Crown be bound. 53
We consider that these recommendations, if implemented, would prevent recurrence of the injustices which have ensued from the present unsatisfactory law, yet afford to the Crown all the special protection which it can reasonably expect the law to give it. If, in any particular case, it desired greater protection, or were not prepared to leave the matter to the courts, there would be nothing to stop it from having an express provision in the legislation in question that the Crown is not bound.
These recommendations provide for radical reform. We consider that nothing short of radical reform meets the need. But if they are not acceptable we recommend that at least one modest reform be made. It is that if the present rule is to be retained - namely that it is presumed that the Crown is not bound unless it is expressly stated that it is bound or it is a necessary inference that it is intended that it be bound - it should be provided that the rule does apply in respect of any statutory duties breach of which would entitle a person thereby suffering harm to recover damages. 54 Such a provision would prevent a recurrence, in respect of legislation to which it applies, of injustice of the type that occured in Downs v. Williams.
Neither our recommendations for radical reform nor the modest recommendation, referred to in the last paragraph, would apply to existing legislation. They would apply only to legislation enacted after they were implemented. We recommend, therefore, that a body be established to review existing legislation. There are strong grounds for believing that it is only because of oversight or misunderstanding that some of the existing legislation, which does not bind the Crown by necessary implication, does not expressly provide that the Crown is bound. It is desirable that, if this body is established, it also keep under review future legislation. We consider it essential that it do so if our recommendations for radical reform are not implemented.
FOOTNOTES
45. Part 14.
46. The limited extent to which the basic formula of the Claims against the Government Act prevents ensuing justice is discussed in Part 4 Sections 9, 10.
47. Part 14 Sections 1-6.
48. In Province of Bombay v. Municipal Corporation of Bombay [1946] A.C. 58 at p.63.
49. (1971) 126 C.L.R. 61.
50. Part 14 Section 11.
51. Part 14 Section 32.
52. The recommendations are set out in full in Part 14 Section 14. It is discussed in Part 14 Sections 15-26.
53. If, of course, it were expressly provided that the Crown were bound, there would be no room for the inference.
54. The recommendation is set out in full in Part 14 Section 30. It is discussed in Part 14 Section 31.
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