This article was written by Alex Morris and Priscilla Lal.
On Wednesday 18 April 2018, the High Court held in Burns v Corbett  HCA 15 that the Civil and Administrative Tribunal of New South Wales (NCAT) does not have jurisdiction to hear matters between residents of different States (diversity jurisdiction). More specifically, the High Court held that under the Constitution, State Parliaments do not have the power to confer diversity jurisdiction on a tribunal or administrative agency which is not a “court of the State”.
The case has significant implications for many types of matters heard by NCAT, including matters like this one, involving complaints made under anti-discrimination and similar tribunals legislation involving residents in different states. It also has implications, as another example, for matters involving residential tenancies where the landlord and tenant reside in different states.
Recent developments in New South Wales may mitigate the effect of the decision:
- The Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) has been amended to allow matters to be referred by NCAT to a court if NCAT would lack jurisdiction due to the matter involving the exercise of diversity jurisdiction.
- NCAT recently decided (Johnson v Dibbin; Gatsby v Gatsby  NSWCATAP 45) that it is a “court of a State” capable of exercising federal diversity jurisdiction (a point not contested in the High Court proceedings).
How did the issue arise?
The issue arose out of complaints made to the Anti-Discrimination Board of New South Wales by Mr Burns about statements made by Ms Corbett and Mr Gaynor. Mr Burns claimed that these statements were public acts which vilified homosexuals contrary to the Anti-Discrimination Act 1977 (NSW). The complaints were ultimately referred to NCAT. Mr Burns was a resident of New South Wales, while Ms Corbett was a resident of Victoria, and Mr Gaynor was a resident of Queensland. The matter was accordingly a matter “between residents of different States” within the meaning of s 75(iv) of the Constitution.
All the parties in the present case accepted that:
- NCAT was exercising the judicial power of a State; and
- NCAT was not a “court of the State”.
Before the Court of Appeal, the Commonwealth (intervening) argued that NCAT lacked jurisdiction to hear the matter because:
- there is an implied limitation in the Constitution which prevents a State law from conferring jurisdiction to decide matters in ss 75 and 76 of the Constitution on a State administrative body, as opposed to one of the Courts of the States; or
- alternatively, any such State law would be inconsistent with s 39 of the Judiciary Act 1903 (Cth), which purports to vest such jurisdiction as federal jurisdiction in courts of a State only, and therefore invalid under s 109 of the Constitution.
The Court of Appeal rejected the first argument but accepted the second. Mr Burns, New South Wales, and the Attorney General for New South Wales each appealed by Special Leave to the High Court.
The High Court’s decision
The High Court, by a majority, held that there was an implied limitation, arising out of Chapter III of the Constitution, which prevents a State law from conferring adjudicative authority over the matters listed in ss 75 and 76 of the Constitution on a State body which is not a court. Accordingly, the provisions of the NCAT Act which purported to confer federal diversity jurisdiction were held to be invalid.
A gap in NCAT’s jurisdiction?
The effect of the decision is that State administrative agencies and tribunals do not have jurisdiction to hear matters arising between residents of different States. However, two recent developments in this space should be noted.
- Shortly before these appeals were heard, Pt 3A of the NCAT Act commenced operation (on 1 December 2017). It provides for matters to be heard by an authorised court, instead of NCAT, if the court is satisfied that NCAT does not have jurisdiction to hear the matter because it involves the exercise of federal diversity jurisdiction.
- In the recent decision in Johnson v Dibbin; Gatsby v Gatsby  NSWCATAP 45, NCAT decided, contrary to the basis upon which these appeals were conducted, that it is a “court of a State” capable of exercising diversity jurisdiction. We understand an appeal from this decision was heard in April 2018 and is currently awaiting judgment.