Disorganized Developments Pty Ltd v South Australia [2023] HCA 22

In Disorganized Developments Pty Ltd v South Australia the High Court determined that South Australian regulations which declared two parcels of land to be ‘prescribed premises’ — prohibiting entry by members of certain criminal organisations — were invalid for two reasons: inefficacy, and for a failure to afford the appellants procedural fairness as owner/occupiers. It re-affirmed the duty of procedural fairness owed to individuals whose property rights are affected by exercise of a statutory power.

Background

Disorganized Developments Pty Ltd, the first appellant, was the registered proprietor of two portions of land in Cowirra, South Australia. The second and third defendants were the directors and sole shareholders of that company and were occupiers of the same land. They were also members of the Hells Angels. Section 83GD(1) of the Criminal Law Consolidation Act 1935 (SA) (the 1935 Act) makes it an offence for a participant of a criminal organisation to enter a prescribed place. The Hells Angels had been declared to be a criminal organisation for the purpose of that offence: at [1]-[2].

The Governor in Council made regulations (the Cowirra Regulations) that intended to declare two parcels of land to be a ‘prescribed place’ under s 83GA(1) of the 1935 Act. A significant consequence was to deprive the appellants of their property rights: at [30]. However, rather than employ language explicitly declaring each parcel of land to be a ‘prescribed place’ as was required for the declaration to be effective, the Cowirra Regulations operated to insert a description of the land into a schedule within pre-existing 2015 regulations: at [10], [19]-[21].

The case was stated to the Court of Appeal by a single judge of the South Australian Supreme Court. The appellants argued the Cowirra Regulations were invalid, including because they were owed and denied procedural fairness: at [29].

The Court of Appeal found that the Cowirra Regulations were valid despite their failure to explicitly declare the portions of land to be prescribed places because that declaration was necessarily implied: at [21]-[22]. The Court also found that the legislature did not intend to create a duty to afford procedural fairness to any owner or occupier of affected land due to the clear policy of the offence-creating Division of the 1935 Act to disrupt organised criminal activity, the text of the same provision, and the existence of the schedule to the 2015 Regulations: at [31], [74].

The appellants appealed to the High Court on two grounds: that the Cowirra Regulations failed to declare the land to be prescribed places within the meaning of the 1935 Act; and that they were made in breach of a duty to afford procedural fairness to the appellants: at [5], [29].

The High Court

The High Court upheld the first ground of the appeal. It found that the Cowirra Regulations were invalid for inefficacy because they failed to explicitly declare that the parcels of land were prescribed places. The intended declaratory effect was not implied by the Cowirra Regulations, nor gained by leaving the ‘operative act’ of declaration to the 2015 Regulations (including after the publication of a consolidated version): at [23]. As stated by the High Court, ‘[t]he apparent inefficacy of the Cowirra Regulations cannot be relied upon to support a conclusion that efficacy must be implied’: at [24].

The Court also addressed the second ground and found that the appellants should have been afforded procedural fairness. The majority emphasised the long-standing duty of procedural fairness owed to individuals whose property rights might be affected by decisions made in the exercise of statutory power, except when displaced through express language or by necessary implication: at [28]. The majority re-affirmed that the duty arises when a person’s property rights are affected as an individual, rather than as a member of the general public or a class of the public: Kioa v West (1985) 159 CLR 550. The vesting of the regulation-making power in the Governor in Council was insufficient to displace considerations of procedural fairness.

Steward J joined the majority in upholding the appeal but dissented in relation to the second ground, finding that considerations of procedural fairness were excluded by necessary intendment. That exclusion was implied by the clear policy behind the legislation to interrupt organised criminal activity: at [59].

The appeal was allowed and the Cowirra Regulations were declared to be invalid. BN