This week, the High Court unanimously rejected a challenge to the validity of legislation enacted by NSW Parliament which retrospectively validated previous ICAC findings following its earlier decision in ICAC v Cunneen. The decision reaffirms findings of corruption made in a report by ICAC against Travers Duncan and other directors of Cascade Coal in their dealings in relation to a mining tenement in the Hunter Valley.

Following the release of the report, Duncan challenged the validity of ICAC’s findings on a number of grounds. In the course of this challenge, the High Court delivered judgment in ICAC v Cunneen, which significantly reduced the scope of activity previously thought to be within the remit of ICAC (read more about ICAC v Cunneen here).

It was accepted by the parties in this case that the decision in ICAC v Cunneen left the findings against Duncan outside the scope of ICAC’s powers.

To prevent the overturning of previous findings of ICAC, the NSW Parliament passed the Independent Commission Against Corruption Amendment (Validation) Act 2015 (NSW) (the Validation Act). In short, the Validation Act broadened the definition of what constituted “corrupt conduct” prior to the ICAC v Cunneen decision to include actions which effected the efficacy (rather than the just the probity) of the exercise of public administration – validating ICAC’s previous findings.

The Validation Act left Duncan with little prospects of success and he challenged the validity of the Validation Act on the basis that it was inconsistent with the Constitution, and thus outside parliament’s legislative powers.

Findings

The majority (French CJ, Keifel, Bell and Keane JJ) rejected an argument that the Validation Act provided impermissible direction to courts to exercise its inherent jurisdiction in a particular manner in breach of the Kable principle. The court held that the Validation Act, when properly construed, altered substantive law to be applied by the courts in accordance with their ordinary process – well within the scope of legislative power.

Additionally, the majority rejected an argument that the Validation Act removed the jurisdiction of the Supreme Court, in breach of the Kirk principle. Again on the basis that while the substantive law had been changed, the jurisdiction of the Supreme Court was not altered.

Nettle and Gordon JJ came to the same view, though on the basis that the laws simply created a new or different legal regime, again, this is within the bounds of legislative powers.

This decision substantially puts an end to a number of other threatened challenges against previous findings of ICAC – it also removes a barrier preventing ICAC from releasing findings in respect of other current investigations.

An end to uncertainty

The Independent Commission Against Corruption Amendment Bill 2015 (NSW) was introduced into parliament this week.

The Bill, if passed, will broaden ICAC’s powers. While the limits that were identified in ICAC v Cunneen, will largely continue, as anticipated ICAC will be able to investigate and make finding of corruption in respect of the some actions of private citizens (rather than just government officials). These powers will apply where the conduct is considered “serious” – examples provided include:

  1. collusive tendering;
  2. fraud in relation to applications for licences or permits facilitating the exploitation of mineral resources; and
  3. dishonestly obtaining public funds for private advantage.

The Bill is likely to have bipartisan support. In combination with the findings in Duncan v ICAC, the Bill provides a welcomeend to the uncertainty around the powers of ICAC to conduct investigations and make findings of corruption.