The Justice Legislation Amendment Bill (No 2) 2017 (the Bill) was assented to on 25 September 2017. The Bill was (relevantly) introduced to deal with the jurisdiction gap arising from the NSW Court of Appeal decision in Burns v Corbett; Gaynor v Burns [2017] NSWCA 3 (Burns). The case, which is currently on appeal to the High Court of Australia, is authority that a state tribunal such as the New South Wales Civil and Administrative Tribunal (NCAT) does not have authority to deal with a dispute arising between two residents of different states by virtue of s 75(iv) of the Commonwealth Constitution. Whilst that was a discrimination case, the principle directly affects NCAT’s jurisdiction in home building matters.

Facts of Burns

Mr Burns, a NSW resident, complained to the NSW Anti-Discrimination Board about remarks made by Ms Corbett, a Victoria resident, and Mr Gaynor, a Queensland resident, which Mr Burns argued were public acts vilifying homosexuals in breach of the Anti-Discrimination Act 1977 (NSW).

When the former Administrative Decisions Tribunal (now NCAT) ordered Ms Corbett to make a public and private apology and Ms Corbett subsequently refused to do so, Mr Burns commenced proceedings in the Supreme Court of NSW for contempt of court.

Ms Corbett’s defence argued that NCAT did not have jurisdiction over her because, at all relevant times, she was a resident of Victoria. The main issue for resolution by the Court was whether NCAT could hear and determine a dispute between a resident of New South Wales and a resident of another state.

The Court held that:

A state tribunal which is not a “Court of a State” is unable to exercise judicial power to determine matters between residents of two states, because the state law which purports to authorise the tribunal to do so is inconsistent with the conditional investment by s 39(2) of the Judiciary Act (when read with s 39A) of all such jurisdiction in state courts. Section 39(2) of the Judiciary Act 1903 (Cth) provides, relevantly, that “Courts of the State” have federal jurisdiction in all matters in which the High Court has original jurisdiction. Pursuant to s 75(iv) of the Constitution, the High Court has original jurisdiction in all matters “between States, or between residents of different States, or between a State and a resident of another State”. The operation of these provisions means NCAT, which is not a “Court of a State”, does not have jurisdiction to hear and resolve matters between residents of different states.

Special leave has been granted by the High Court and the states Attorneys-General are intervening.

Justice Legislation Amendment Bill (No 2) 2017

The Bill introduces amendments to the Civil and Administrative Tribunal Act 2013 (NSW) in order to overcome the jurisdiction gap arising from Burns. The amendments will enable applicants, with the leave of the Local Court or District Court, to commence proceedings in the Court for the determination of both original applications and external appeals that NCAT cannot otherwise determine due to s 75(iv) of the Constitution, having regard to the decision in Burns.

As such, a party in dispute with a resident of another State will be able to commence proceedings in the Local Court or District Court (as appropriate) for matters where the amount in dispute is less than $500,000, despite ss.48K and L of the Home Building Act 1989 (NSW) (the Act).

The Local Court or the District Court may grant leave for the application or appeal to be made to the Local Court or the District Court only if it is satisfied that:

  • the application or appeal was first made with NCAT;
  • NCAT does not have the jurisdiction to determine the matter because it involves the exercise of federal diversity jurisdiction;
  • NCAT would otherwise have had original jurisdiction or external appellate jurisdiction to determine the matter; and
  • substituted proceedings on the application or appeal would be within the jurisdiction limit of the Court.

The Bill also gives the Local Court and District Court the power to remit the matter to NCAT if it is determined that NCAT has jurisdiction.

Schedule 1.2 of the Bill, which contains the changes to the Civil and Administrative Tribunal Act 2013 (NSW), has not yet commenced.