High Court decision affecting your practice in VCAT

High Court decision affecting your practice in VCAT

Wednesday, 30 May 2018

Earlier this month, the High Court made an important decision about a constitutional issue that makes a difference to everyday practice in VCAT. Ultimately, it said that if there is a dispute between residents of different States at VCAT, in many cases VCAT is not able to determine the dispute. If it does, the decision will not be effective. 

Which matters are affected?

The recent High Court decision in Burns v Corbett [2018] HCA 15 has the effect of confirming that NCAT (and by extension VCAT) does not have jurisdiction to adjudicate disputes between residents from different States. In VCAT this is very likely to affect many practice areas, including:

  • residential tenancy disputes
  • discrimination disputes
  • civil claim disputes.

But, it may arise anywhere that VCAT is determining rights between parties and you have the residence issue. 

However, merits review matters in VCAT are unaffected (please see below for further explanation).

What is 'a resident', do I need to worry about interstate or foreign companies?

This decision only affects natural people and does not extend to corporations.

What obligations may arise?

As a result of Burns, practitioners appearing in VCAT outside of the merits review or pure administrative decision-making space need to try to proactively determine the residency status of parties in affected disputes. 

Practitioners should also consider their obligations to VCAT where a potential or known jurisdictional issue appears to arise, as a result of the decision.

The law

This jurisdictional issue arises in VCAT because the High Court has held that only the Federal Courts or a ‘courts of a State’ (a special term in the constitution) can exercise federal judicial power. It has also held that only these courts can determine the particular types of dispute which are set out in ss 75 and 76 of the constitution. These include:

  • disputes between residents of different States
  • disputes between a State and a resident of another State
  • disputes in which the Commonwealth, or a person suing or being sued on behalf of the Commonwealth, is a party.

This means that State Tribunals cannot exercise federal judicial power or determine these disputes, unless they are able to be described as a ‘court of the State’. 

The prevailing law in Victoria is that VCAT is not a court of the State. As such, VCAT is unable to adjudicate these matters.

These cases may now require adjudication in a court in Victoria, but at present there is no legislative avenue to make this happen across the range of matters which could be affected by the decision.

Why isn’t merits review affected?

This is because when VCAT conducts merits review, it’s not adjudicating anything. Instead, unlike adjudication (where existing rights between parties are determined using judicial power), the determination of the correct or preferable decision by a merits review body is an exercise of administrative power to create new rights (in the same way as the original government agency or officer-holder did).

There may be some types of matters where it is not entirely clear whether VCAT is exercising judicial power to adjudicate a dispute. Prudence is recommended in such areas.

More information 

Read the High Court decision Burns v Corbett [2018] HCA 15

Was this helpful?