Addressing VCAT’s jurisdictional limitations

On 3 October 2023, the Victorian Parliament passed the Justice Legislation Amendment Bill 2023. The Bill received the Royal Assent on 10 October 2023. The Justice Legislation Amendment Act 2023 (JLAA) amends, among other things, the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act) to address problems faced by parties with matters involving Commonwealth jurisdiction following the recent decision in Thurin & Anor v Krongold Constructions (Aust) Pty Ltd & Ors [2022] VSCA 226 (Thurin v Krongold).

In Thurin v Krongold, the Court of Appeal confirmed that the Victorian Civil and Administrative Tribunal does not have jurisdiction to hear any proceeding involving the exercise of judicial power in relation to federal subject matter. The VCAT Act provides two avenues that might be relied upon to transfer a matter from VCAT to a forum that has jurisdiction to decide in circumstances where a matter in the Tribunal involves federal jurisdiction: Part 3A and s 77 of the VCAT Act. Both Part 3A and s 77 of the VCAT Act are the subject of amendments arising out of the JLAA.

SECTION 77 OF THE VCAT ACT

Section 77 of the VCAT Act empowers the Tribunal to make an order striking out all or part of certain proceedings if it considers that the subject matter of the proceeding would be more appropriately dealt with by another body. The Tribunal may rely upon s 77(1), or alternatively s 75(1) of the VCAT Act, to strike out part of a proceeding that it has no jurisdiction to hear and determine.[1] It also has the power to refer the dispute to another forum under s 77(3) of the VCAT Act as explained below.

The Tribunal’s power to make a referral order under s 77(3) is triggered on the striking out of all or part of the proceeding. At that stage, the entire proceeding can be referred to the more appropriate forum.[2]

The JLAA amends s 77 of the VCAT Act. Relevantly, it does two things:

1. first, it expands the class of Tribunal members who can exercise powers under ss 77(1) and 77(3)[3] to include a presidential member or a senior member who has been an Australian lawyer for not less than 5 years; and
2. second, where a matter is referred to a court by the Tribunal under s 77(3), it provides the courts with the power to extend any limitation period that applies to the commencement of a proceeding in relation to that matter so as to allow the proceeding to be commenced and determined,[4] provided certain conditions are satisfied. However, in light of the (even more recent) decision in Krongold Constructions (Aust) Pty Ltd v Thurin [2023] VSCA 191 (published in the same week the Justice Legislation Amendment Bill 2023 was introduced into Parliament), this provision may have little work to do. This is because this recent decision of the Court of Appeal appears to have the same effect, on this point, as the JLAA.

PART 3A OF THE VCAT ACT

Part 3A was introduced in 2021 following concerns that recent decisions regarding the Tribunal’s jurisdiction meant that: (1) where the Tribunal has exclusive jurisdiction, disputing parties in matters involving federal jurisdiction (referred to as ‘federal jurisdiction matters’) could not resolve their dispute through the court system; and (2) previous decisions made by the Tribunal in ‘federal jurisdiction matters’ were invalid and unenforceable because they were made without jurisdiction. The parliament sought to address these concerns by: (a) conferring jurisdiction on the Magistrates’ Court to resolve federal jurisdiction matters which could not be resolved by the Tribunal for constitutional reasons; and (b) validating past Tribunal decisions in federal jurisdiction matters (referred to herein as the ‘curative provisions’).[5]

The JLAA amends Part 3A of the VCAT Act in two important ways.

First, it amends the circumstances in which the mechanism for the commencement of substituted proceedings in the Magistrates’ Court or another Court is available.[6] Previously, that mechanism was available to parties with matters that have not yet been decided on the merits (that is, matters that have not yet commenced or that the Tribunal has struck out, dismissed, etc, based on a lack of jurisdiction) and matters where a court has set aside a final decision by the Tribunal on jurisdictional grounds on an appeal or review commenced before 10 August 2021. The amendments are concerned with this latter situation (where a court has set aside a final decision by the Tribunal on jurisdictional grounds) and extend the mechanism to anyone who was a party to a proceeding in the Tribunal that is the subject of an appeal or review commenced before 10 October 2023 where that appeal or review is successful in setting aside the Tribunal’s decision on jurisdictional grounds.

Second, it amends the curative provisions. The curative provisions are intended to “validate” decisions of the Tribunal that are invalid for jurisdictional reasons.[7] They apply to what is termed an “invalid Tribunal decision”, which is defined by s 57A as:

1. a decision, order or declaration, or purported decision, order or declaration, made before the commencement of this Part by the Tribunal in any proceeding determined by exercising judicial power involving federal subject matter which is invalid only because of that reason.

The JLAA amends the definition “invalid Tribunal decision” to make the provision applicable to decisions of the Tribunal made on or before the JLAA received Royal Assent (10 October 2023). Before, the curative provisions applied only to decisions made before the commencement of Part 3A of the VCAT Act, that is, before 29 November 2021. The curative provisions are found in ss 57F, 57G and 57H. None of these sections is amended by the JLAA.

The JLAA also amends[8] the provisions that exclude the curative provisions from applying to matters involving a past appeal or review that overturned a decision on jurisdictional grounds or a current appeal or review that includes a jurisdictional ground. Previously, Part 3A purported to validate past invalid Tribunal decisions made before 29 November 2021, provided the decision had not been the subject of an appeal or review that was either determined before 29 November 2021 or that was commenced but not determined on or before 10 August 2021. As amended, Part 3A excludes the operation of the curative provisions where an appeal or a review that includes a jurisdictional ground has been commenced but not determined after 10 August 2021 but before 10 October 2023.

[1] Houndalas v Burnham [2006] VCAT 1308 at [42]; Pizer’s Annotated VCAT Act (Sixth edition, Thomson Reuters, 2017), [VCAT.77.40]. Thurin v Krongold at [138]-[152]. See also, Qantas Airways v Lustig (2015) 228 FCR 148 at [108]-[109], [113].

[2] Gore Street Pty Ltd v Enviroprotect Pty Ltd [2003] VCAT 955 at [9]; Pizer, [VCAT.77.40].

[3] Previously, the power was exercisable only by a judicial member.

[4] Even if, but for the amendment, the (new) proceeding would otherwise be statute barred.

[5] See Statement of Compatibility and Second Reading Speech: Victoria, Parliamentary Debates, Legislative Assembly, 26 May 2021, 1785 and 1788.

[6] Under s 57B of the VCAT Act.

[7] Justice Legislation Amendment Bill 2023, Explanatory Memorandum, Part 10, Division 1.

[8] By operation of s 66 of the JLAA.