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Published online by Cambridge University Press: 24 January 2025
In 1989 the Commonwealth Government released a policy statement entitled “New Directions in Commonwealth Fisheries Management”. Its aim was to establish a regulatory framework which would encourage the biologically sustainable exploitation of Australia's fisheries while increasing economic efficiency in the industry and facilitating the introduction of a resource rent. Heeding economists' arguments that the introduction of greater property rights for individual fishermen would meet these ends, the policy statement identified as central to its proposed reforms the introduction of Individual Transferable Quotas (ITQs). Most Australian fisheries achieve restrictions on catch by limiting the size and fishing capacity — that is, the efficiency — that is, the efficiency — of boats in a fishery. Alternatively, they limit fishing hours, thus encouraging over-development of fishing capacity by fishermen seeking maximum catches in the available time. ITQs, by comparison, grant to their owners the right to take a specified quantity of fish, at any time and with the most suitable equipment, thus avoiding wasteful use of costly fishing gear. Being a direct measure of productivity, they also lend themselves to the collection of a resource rent.
1 J A Crutchfield and A Zellner, Economic Aspects of the Pacific Halibut Fishery, US Department of the Interior (1963); T F Meany, “The Nature and Adequacy of Property Rights in Australian Fisheries” in N H Sturgess and T F Meany (eds), Poliocy and Practice in Fisheries Management (1982); A Scott, “Catch Quotas and Shares in the Fishstock as Property Rights” in E Miles, R Peally and R Stokes (eds), Natural Resources Economics and Policy Applications (1986); A Scott, “The Evolution of Individual Transferable Quotas as a Distinct Class of Private Property Right” in H Campbell, K Menz and G Waugh (eds), Economics of Fishery Management (1989); J Crutchfield, “Fisheries Management: A Time for Change”, in T J A Hundloe (ed), Fisheries Management: Theory and Practice in Queensland (1986); D G Moloney and P H Pearse, “Quantitative Rights as an Instrument for Regulating Commercial Fisheries” (1979) 36 of the Fisheries Research Board of Canada 859.
2 An ITQ regime came into operation in the South-East Trawl fishery on 1 January 1992 and in the Southern Bluefish Tuna (SBT) fishery in 1984, and there have been recommendations that other major fisheries such as the Northern Prawn fishery follow suit: M France, “ITQs may be good in theory but can they work in practice?” Australian Fisheries (August 1991) 14. Otherwise Australian fisheries are regulated by restrictions on fishing capacity and fishing time.
3 ITQs, although an improvement on previous management regimes, are not a perfect system for protecting fish numbers. The major problems are unrecorded catch, under-reporting of catch and the dumping of ancillary species caught in a net and of low grade fish: Department of Primary Industries and Energy, Longterm Management in the South East Trawl Fishery: Information Paper No 4 (1991); L Wilson, “ITQs are not TACs” Australian Fisheries (September 1991) 2; P Copes, “A Critical Review of the Individual Quota as a Device in Fisheries Management” (1986) 62 Land Economics 278.
4 ITQs may not be best for sessile fish species, for which other farming methods might be used, or for high fecundity species, which might afford to be fished more thoroughly.
5 North American fisheries have been at the forefront of ITQ innovation. For claims as to its success in those fisheries, see L Wilson, “ITQs around the World” Australian Fisheries (October 1991) 15.
6 “Property” is mentioned only in Chapter 11, in a discussion of the weaknesses of a different, pure property-rights system unregulated by government.
7 Senate debates about Northern Prawn Fishery Plan of Management No 12: Sen Deb 1987, Vol 127 at 2261.
8 Fishermen may be required to hold two different licences for the same fishery. Under the new legislation, moreover, they may hold one new Commonwealth transferable, revocable licence in perpetuity and an annual, old-style, boat-specific licence from the State. Even in the same scheme, it may be necessary to differentiate between a licence, an endorsement, a quota or a unit. Indeed it is a fundamental weakness that a fisherman may require two very different licences in the same fishery for catching the same fish. There are also jurisdictional problems with migratory and mobile species. See generally, J Waugh, Australian Fisheries Law (1988).
9 Ibid; E Campbell, “Regulation of Australian Coastal Fisheries” (1960) 1 Tas L Rev 405.
10 New South Wales v The Commonwealth (the Seas and Submerged Lands Act case) (1975) 135 CLR 337; Port MacDonnell Professional Fishermen’s Association Inc v South Australia (1989) 168 CLR 340; Bonser v La Macchia (1969) 122 CLR 177; Attorney-General (British Columbia) v Attorney-General (Canada) [1914] AC 53; Attorney-General (Canada) v Attorney-General (Quebec) [1921] 1 A.C.413.
11 T F Meany, above n 1.
12 A Scott (1986), above n 1 at 63-65. ITQs are themselves evidence of this politically divisive effect. They disadvantage small fishermen, who are unable to increase quotas in the marketplace, and are locked into diminished returns if the Total Annual Catch, of which each ITQ represents a percentage portion, decreases. Although the “industry” has supported the programme in the Southern Bluefin Tuna fishery, ITQs have provoked widespread antagonism among New South Wales SBT fishermen: B Stanard, “Our Fish are going off’ Bulletin June 25 1991 at 100.
13 Halsbury’s Laws of England (4th ed) Vol 18, para [616].
14 Seymour v Courtenay (1771) 5 Burr 2814; 98 ER 478; Lord Fitzwalter’s case (1674) Mod 105; 86 ER 767.
15 Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 335.
16 (1840) 7 M & W 63; 151 ER 679; for similar terms in a grant see Ewart v Graham (1859) 7 HLC 331; 11 ER 132.
17 J M Cormack, “Legal Cases in Concepts of Eminent Domain” (1931-2) 41 Yale L] 221 at 221223.
18 Tulk v Moxhay (1848) 2 Ph 774; 41 ER 114.
19 Except in very constricted circumstances: Halsall v Brizell [1957] Ch 169.
20 Dales, J H, Pollution, Property and Prices (1968)Google Scholar; H S Gordon, “The Economic Theory of a Common Property Resource: The Fishery” (1954) 62 Political Economy 124; R H Posner, Economic Analysis of Law (2nd ed 1977).
21 Reich, C, “The New Property” (1964)CrossRefGoogle Scholar 73 Yale LJ 733.
22 For the relevance of property concepts to Marxist interpretations, see, eg, O Kahn-Freund, “Introduction” to K Renner, The Institutions of Private Law and their Social Functions (1949); W Friedmann, Legal Theory (5th ed 1967) at 367-371 and 405-407.
23 C Reich, above n 21.
24 F Cohen, “Dialogue on Private Property” (1954) 9 Rutgers L Rev 357.
25 MacPherson, C B, “Capitalism and the Changing Concept of Property” in E Kamenka and RSNeale (eds), Feudalism, Capitalism and Beyond (1975)Google Scholar.
26 Rural Australia has been particularly slow to give in; see generally J R Bradsen, Soil Conservation Legislation in Australia (1988) (National Soil Conservation Programme Report). But as evidence of greater regulatory involvement, see the South Australian vegetation clearance controls: R J Fowler, “Vegetation Clearance Controls in South Australia - A Change of Course” (1986) 3 Environment and Planning LJ 48 and recent regulatory amendments to the Planning and Environment Act 1987 (Vic). Bradsen has argued that the solution to increasing land degradation may lie in increased community involvement in private use of farming land.
27 For example Mining Act 1971 (SA); Coal Acquisition Act 1981 (NSW).
28 (1937) 58 CLR 479.
29 International News Service v Associated Press 248 US 215 (1918).
30 (1937) 58 CLR 479 at 496 per Latham CJ.
31 Bollinger v Costa Brava Wines Co Ltd [1960] Ch 262 at 275 per Danckwerts J.
32 Bollinger was specifically approved by the House of Lords in Erven Warmink BVv] Townerd & Sons (Hull) Ltd [1979] AC 731.
33 Hounslow London Borough Council v Twickenham Garden Developments Ltd [1971] Ch 233.
34 Cornell v The Rosehill Racecourse Co Ltd (1937) 56 CLR 605, although see Heidke v Sydney City Council (1952) 52 SR(NSW) 143.
35 Errington v Errington [1952] 1 KB 290; Binion v Evans [1972] Ch 359.
36 Kirby v Thorn EMI Pty Ltd [1988] 1 WLR 452 per Nicholls LJ.
37 Dorman v Rogers (1982) 148 CLR 365 at 372-373 per Murphy J.
38 Pennington v McGovern (1987) 45 SASR 27; Austell Pty Ltd v Commissioner of State Taxation 89 ATC 4905.
39 Minister of State for the Army v Dalziel (1944) 68 CLR 261 at 285 per Rich J.
40 (1982) 158 CLR 327.
41 (1971) 17 FLR141 at 272.
42 Existing management plans are currently being reviewed with an eye to the provisions of the new Act. At the time of writing, the SBT fishery, the first fishery to have a management plan implemented under the new Act, was in the process of adapting to its new arrangements. The quota allocation arrangements were the subject of an appeal to the Federal Court by Austral Fisheries on the basis that they produced a result so absurd that no reasonable person could defend it on justifiable grounds. It was also expected, at the time of writing, that the SBT would continue to operate under existing arrangements until such time as relevant constitutional arrangements could be made between the States.
43 See the discussion of the new statutory fishing right in the following paragraphs.
44 An example of different fishing interests currently in operation in Australia is the unit of input capacity used in the Northern Prawn fishery, which was the subject of public controversy in 1987 (see Introduction). A unit of input capacity is a measure of the type or amount of equipment that a fisherman may use. As the legislative scheme operated in the Northern Prawn fishery at the time of writing, a unit was a measure of “hull units” (which bears a relation to the size of the boat) and “engine power units” (which bears a relation to the size of the boat’s engine).
45 The AFMA is established under the Fisheries Administration Act 1991 (Cth). That Act is one of a group of six Acts which includes the Fisheries Management Act 1991.
46 A “fishing concession” is defined in s 3 as “(a) a statutory fishing right; or (b) a fishing permit…”.
47 See s 32(7).
48 Sen Deb 1991, Weekly Hansard No 11, 4567 (6 June 1991).
49 In some fisheries (eg, where ITQs are not used), the “statutory fishing right” could be “the right to use a boat, or a boat of a particular size … In other fisheries it could be a boat unit … or it could be a unit of fishing gear”: F Meany, “Managing fisheries in the best interests of all” Australian Fisheries (January 1992) 6 at 8.
50 For instance, if the relevant plan of management for the fishery is revoked or if the fishery becomes managed by a Joint Authority pursuant to a Commonwealth-State agreement: s 22(3)(b)-(c).
51 Any dealing purporting to create or assign an interest in a fishing right has no effect until registered (s 46(2)), although registration confers no legal effect upon an instrument which it would not otherwise have had (s 51).
52 (1987) 45 SASR 27.
53 Ibid at 31.
54 Ibid at 45.
55 (1988) 48 SASR 115.
56 [1989] VR 149.
57 Under a writ of fieri facias.
58 [1989] VR 149 at 150 (emphasis added).
59 Anthoness v Anderson (1888) 14 VLR 127 (liquor licence).
60 Jack v Smail (1905) 2 CLR 684 (grocer licence).
61 Banks v Transport Regulation Board (Vic) (1968) 119 CLR 222 (taxi licence).
62 ”If the licence holder lacked the capacity to freely dispose … then the licence itself did not amount to property for the purposes of [those] Acts”: [1989] VR 149 at 153.
63 Ibid at 159.
64 Ibid.
65 Ibid at 155.
66 Ibid at 160.
67 (1989) 89 ATC 4905.
68 Ibid at 4909.
69 Ibid at 4913, quoting Pollock B in Smelting Company of Australia v IR Commissioners [1896] 2 QB 179.
70 (1989) 89 ATC 4905 at 4914.
71 (1968) 119 CLR 222.
72 [1896] 2 QB 179.
73 (1981) 148 CLR121.
74 Ibid at 130 per Mason J.
75 Halsbury’s Laws of England (4th ed) Vol 14, para [244].
76 Alfred F Beckett v Lyons [1967] 1 Ch 449 at 482 per Winn J.
77 Halsbury’s Laws of England (4th ed) Vol 14, para [242].
78 Marshall v Ulleswater Steam Navigation (1863) B&S 732; 122 ER 274; Wickham v Hawker (1840) 7 M&W 63; 151 ER 679.
79 Harper v Minister for Sea Fisheries (1989) 168 CLR 314 at 335 per Brennan J.
80 (1989) 168 CLR 314.
81 Ibid at 325 per Mason CJ, Deane and Gaudron JJ.
82 According to the definition of a tax in Air Caledonie International and Others v The Commonwealth (1988) 165 CLR 462.
83 (1989) 168 CLR 314 at 334 per Brennan J.
84 Ibid at 335.
85 Ibid.
86 With the rare exceptions of private fisheries granted by the King prior to Magna Carta. See below, text and n 95.
87 Toohey (1982) 158 CLR 327 at 342-344.
88 In the context of statutory mining rights, see M Crommelin, “The Legal Character of Petroleum Production Licences in Australia” in T C Daintith (ed), The Legal Character of Petroleum Licences: A Comparative Study (1981) 60.
89 Ibid at 66.
90 Case of Swans (1592) 7 Co Rep 15b, 17b; 77 ER 435.
91 Alfred F Beckett v Lyons [1967] 1 Ch 449.
92 Lord Firzhardinge v Purcell [1908] 2 Ch 139; Halsbury’s Laws of England (4th ed) Vol 14 para [242].
93 (1592) 7 Co Rep 15b, 17b; 77 ER 435.
94 Ewart v Graham (1859) 7 HL Cas 331; 11 ER 132; Halsbury’s Laws of England (4th ed) Vol 2 para [208].
95 These were known as “several” fisheries: Malcomson v O’Dea (1863) 10 HL Cas 593 at 618619; 11 ER 1155 at 1166.
96 New South Wales v The Commonwealth (Seas and Submerged Lands Act case) (1975) 135 CLR 337 per Gibbs J and Stephen J.
97 United States v California 332 US 19 (1974).
98 Reference re Ownership of Offshore Mineral Rights (1967) 65 DLR (2d) 353.
99 These were passed at the request of State parliaments under s 51(38).
100 (1975) 135 CLR 337.
101 The exact geographical scope of the Acts is described in Schedule 2 to the Petroleum (Submerged Lands) Act 1967 (Cth). See Port MacDonnell Professional Fishermen’s Association Inc v South Australia (1989) 168 CLR 369.
102 The argument is that the Act is not supportable by s 51(38), as it is not a law for the “peace, order and good government” of the Commonwealth because it divests the Commonwealth of large tracts of property which it is unable to re-claim without paying just compensation under s 51(31) of the Constitution. The major obstacle to that argument is the extremely narrow interpretation given by the High Court to the substantive effect of the phrase “peace, order and good government”: see Union Steamship of Australia Pty Ltd v King (1988) 166 CLR 1, and the discussion in P Hanks, Constitutional Law in Australia (1981) at 88.
103 (1989) 168 CLR 314 at 335.
104 If the fishery is not regulated pursuant to the Coastal Waters (State Powers) Act 1980 (Cth) (as is the SBT), then either (i) the Commonwealth will have legislative powers because the fishery crosses State coastal waters and the States involved have consented to Commonwealth regulation, or (ii) because no Commonwealth-State agreement of any kind has been reached. Commonwealth ITQs will only regulate waters outside three nautical miles and State regulations will apply within that distance.
105 Coastal Waters (State Powers) Act 1980 (Cth), s 4(2).
106 Section 51 empowers the Commonwealth to make laws “for the peace, order and good government of the Commonwealth with respect to:- … (10) Fisheries in Australian waters beyond territorial limits.1’
107 (1969) 122 CLR 177. That case upheld the operation of Commonwealth legislation six nautical miles from the coast of New South Wales. At that time, Australia’s territorial waters extended only to three nautical miles.
108 Continental Shelf (Tunisia v Libya) case (1982) ICJ Reports 18 at 74.
109 Article 61.
110 Powers, for example, to construct islands and other apparatus for the purpose of exploiting the seabed (Article 60).
111 Robinson v Western Australian Museum (1977) 138 CLR 283; M Crommelin, above n 88.
112 M Crommelin, above n 88.
113 Co Litt 122b per Lord Coke, cited in argument in Malcomson v O’Dea (1863) 10 HL Cas 593 at 603; 11 ER 1155 at 1160.
114 Halsbury’s Laws of England (4th ed) Vol 18 para [622].
115 (1989) 168 CLR 314 at 335.
116 Ibid at 325 (emphasis added).
117 H R Williams, “Comments on Oil and Gas Jurisprudence in Canada and the United States” (1965) 4 Alberta L Rev 189 at 192-193.
118 (1979) 22 ALR 465.
119 Ibid at 470.
120 (1983) 158 CLR 327 at 344.
121 [1986] 2 Qd R 216.
122 Ibid at 219.
123 [1985] VR 725.
124 Ibid at 738.
125 M Crommelin, above n 88.
126 (1971) 17 plr i4i at 272.
127 Ibid.
128 [1965] AC 1175 at 1248.
129 (1982) 158 CLR 327 at 342.
130 Gibbs CJ and Murphy J agreeing.
131 To be usable and exclusive (Blackburn J), to be definable, indentifiable and stable (Lord Wilberforce), and to be transferable (both).
132 (1989) 168 CLR 314 at 335 (emphasis added). That problem did not arise in Harper, however, for the management of the fishery in accordance with Tasmanian law is arranged between the Commonwealth and Tasmania (see above at 390).
133 There are, for example, no restrictions on how or when the quota is obtained, or on who is employed actually to take the fish. Neither are there restrictions on whether its owner sells, leases or pledges it as security.
134 See generally, M Crommelin, above n 88.
135 Unimin Pty Lty v The Commonwealth (1974) 22 FLR 299 at 308 per Connor J.
136 (1982) 158 CLR 327.
137 See generally Zapletal v Wright [1957] Tas SR 211.
138 (1970) 91 WN(NSW) 861.
139 Attorney-General v Cochrane (1970) 91 WN(NSW) 861 at 871.
140 Johnston Fear & Kingham & The Offset Printing Co Pty Ltd v The Commonwealth (1943) 67 CLR 314 at 318 and 325, regarding s 51(6) (the power of the Commonwealth to legislate in relation to defence). There is a limited exception in relation to those powers which necessarily involve the acquisition of property: Deane J, in The Commonwealth v Tasmania(the Franklin Dam case) (1983) 158 CLR 1 at 282, cites taxation, the forfeiture of prohibited imports and the sequestration of the property of a bankrupt. See also Mutual Pools and Staff Pty Ltd v The Commonwealth (1994) 68 ALJR 216 at 230-231 per Deane and Gaudron JJ.
141 The relationship between s 51(31) and other heads of Commonwealth power was discussed in a series of cases decided as this article was going to press: Mutual Pools and Staff Pty Ltd v The Commonwealth [1994] 68 ALJR 216; Health Insurance Commission v Peverill [1994] 68 ALJR 251; Georgiadis v Australian & Overseas Telecommunications Corporation [1994] ALJR 272 and Re Director of Public Prosecutions; ex parte Lawler [1994] ALJR 289. These cases do not affect the conclusions I reach. None of them concerns a statutory scheme of resource allocation. Peverill comes closest, in that it concerns a right to payment under a statutory scheme. There was held in that case to be no unlawful acquisition of property when a doctor’s statutory right to reimbursement from the Commonwealth Government under its medical benefits scheme was replaced by a statutory right to be reimbursed at a lower level. To the extent that this exhibits a preference on the Court to treat rights created pursuant to statute as falling outside the protection of s 51(31), it serves to reinforce the conclusion I reach at the end of this article.
142 Tax is levied on “any form of property”: Income Tax Assessment Act 1936 (Cth), s 160A.
143 Clunies-Ross v Commonwealth (1984) 155 CLR 193 at 201-202.
144 The Commonwealth v The State of New South Wales (1923) 33 CLR 1 at 20-21 per Knox CJ and Starke J.
145 Bank of New South Wales v The Commonwealth (the Banking case) (1948) 76 CLR 1 at 349, approved in Mutual Pools and Staff Pty Ltd v The Commonwealth (1994) 68 ALJR 216 at 222 per Mason CJ and at 229 per Deane and Gaudron JJ.
146 (1944) 68 CLR 261.
147 (1948) 76 CLR 1.
148 Ibid at 349.
149 (1983)158 CLR 1 at 287.
150 Trade Practices Commission v Tooth & Co Pty Ltd (1979) 142 CLR 397 at 408 per Gibbs J. See also Georgiadis v Australian and Overseas Telecommunications Corporation (1994) ALJR 272 at 275-276 per Mason CJ, Deane and Gaudron JJ.
151 Franklin Dam case (1983) 158 CLR 1 at 145.
152 Ibid at 146.
153 Ibid at 145 per Mason J.
154 Ibid at 283.
155 Ibid at 287.
156 Be it a resource rent under the new system, in which such a rent will be an integral part ot fisheries management (see the Policy Statement, and see the Fisheries Management Act 1991) or a licence fee of the kind by which the Commonwealth has traditionally collected income.
157 The decision in Minister v Davey (1993) 119 ALR 108 was reported after this article was written. That case concerned input licences of the type described in n 44 above, which were held in the Northern Prawn Fishery under the Fishing Act 1952 (Cth). The Full Court of the Federal Court held that the cancellation of 30.76% of each fisherman’s units was not contrary to s 51(31). Burchett J found that the benefits which could be said to flow to the Commonwealth from cancellation of the units did not constitute an “acquisition” for the purposes of s 51(31): see at 128-129. But cf at first instance: Fitti v Minister for Primary Industries & Energy (1993) 17 ALR 287 at 294-296 per O’Loughlin J. The decision of the Full Court is in line with the conclusion I reach at the end of this article in relation to ITQs held under the Fisheries Management Act 1991.
158 (1983) 158 CLR 1 at 181 per Murphy J. See also Mason J at 145 and Brennan J at 247-248. Gibbs CJ, Wilson and Dawson JJ decided on different grounds and did not need to consider s 51(31). And see Mutual Pools and Staff Pty Ltd v The Commonwealth (1994) 68 ALJR 216 at 222 per Mason CJ: “the distinction between extinguishment and acquisition of rights is clearly recognized in property law.”
159 (1983) 158 CLR 1 at 283.
160 See, for example, M Crommelin, above n 88.ICI Alkali (Australia) Pty Ltd (in vol liq) v Federal Commissioner of Taxation (1979) 22 ALR 465.
161 (1979) 142 CLR 397 at 414_415 citing 29A Corpus Juris Secundum Eminent Domain, para 6.
163 (1979) 142 CLR 397 at 414-415.
164 Armstrong v United States 364 US 40 (1960) at 49.
165 ”The government believes that where individuals or firms are provided with preferential rights to exploit a community resource, they should pay an appropriate charge to the community as owner of the resource” (Policy Statement: “New Directions in Commonwealth Fisheries Management” (1989)).
166 (1979) 142 CLR 397 at 452 per Aickin J.
167 Smith Kline & French Laboratories (Australia) Limited and Others v Secretary, Department of Community Services and Health (1990) 95 ALR 87 at 127 per Gummow J.
168 n 979) 142 CLR 397 at 247-8.
169 Venn Central Transport Co v New York City 438 US 104 (1978) at 124.
170 (1979) 142 CLR 397 at 434.
171 For a discussion in the context of s 51(31) of a 30.76% diminution in the value of licences due to amendment of a Commonwealth Government scheme, see Minister for Primary Industry and Energy v Davey (1993) 119 ALR 108 at 130-131 per Burchett J; and see, generally. Mutual Pools and Staff Pty Ltd v The Commonwealth (1994) 68 ALJR 216 at 235-236 per Dawson and Toohey JJ.
172 B Stanard, above n 12; L Wilson, above n 5.
173 A Scott (1986), above n 1.
174 M Crommelin, “Mining and Petroleum Titles” (1988) 62 AL] 863 at 871.
175 A Scott (1986), above n 1.