Does the 'Serious Overseas Criminal Matters' scheme have serious legal issues?
Amanda Sapienza
09.04.18
According to a recent front-page news story (The Australian, Tuesday 13 March 2018), the Serious Overseas Criminal Matters scheme (‘SOCM scheme’) has helped to pay for legal assistance for Peter Scully, Cassie Sainsbury, Schapelle Corby, David Hicks, Andrew Chan and Myuran Sukumaran. The scheme is one example of many arrangements, grants or programs (here referred to as ‘schemes’) entered into or developed by the Commonwealth for the expenditure of public money on matters that the Commonwealth government deems worthy. But several High Court decisions over the last decade have put the constitutional validity of such schemes in doubt. And even if the SOCM scheme is constitutionally valid, the legal basis for decisions made under it is opaque. This post aims to highlight the public law issues raised by the SOCM scheme. It demonstrates that the recent High Court decisions on government expenditure have raised more questions than they have answered and that, with the number of schemes growing (776 at last count), questions are likely to increase in frequency and complexity.
The SOCM scheme
A quick summary of the SOCM scheme is useful before diving into the legal analysis. The Attorney-General’s website states that ‘[t]he Attorney-General’s Department may help Australians facing serious criminal charges in an overseas country with the cost of their defence’ and provides for applications to be made for grants to cover legal fees and other expenses. The SOCM scheme is not authorised by a statute, as is made clear by Part 3 Div 2 of the Guidelines establishing the scheme (and others like it) (‘the Guidelines’). Clause 3.6 of the Guidelines states that the purpose of the SOCM scheme is:
to provide financial assistance for an individual facing an overseas criminal legal action if:
(a) the individual is being, or will be, prosecuted for a criminal offence for which the individual may be punished by:
(i) a term of imprisonment equal to or longer than 20 years; or
(ii) the death penalty; and
(b) the individual has a continuing connection with Australia.
The Guidelines are very detailed and read much like a statutory scheme. They purport to impose duties on the Department, on the decision-maker, and on the applicant. The Guidelines list the matters to which a decision-maker ‘must’ have regard (the nature of the crime alleged is not such a matter) and state the financial assistance available. The Guidelines provide for review of decisions in Part 9, outlining an internal review process and informing applicants that they may seek judicial review of a decision made under the SOCM scheme under s 39B of the Judiciary Act 1903 (Cth). All the while, however, the document is littered with clauses to preserve the Attorney-General’s discretion in relation to making grants of assistance. They essentially amount to a statement that nothing in the Guidelines prevents the Attorney-General from changing them, departing from them or making decisions not in accordance with them.
The public law issues
I turn now to the constitutional issues raised by the legal mechanism by which the SOCM scheme is implemented. The Commonwealth appears to have appropriated funds for financial assistance schemes that would encompass the SOCM scheme. This is suggested by Program 1.4 (page 19) of the Attorney-General’s current Portfolio Budget Statement, read together with Appropriation Act (No 1) 2017–2018 (Cth) ss 4, 8 and Sch 1. However, it was established by the High Court in Pape v Commonwealth that simply because the Commonwealth has the power to appropriate public money, or earmark public funds, for expenditure for a particular purpose, does not mean the Commonwealth has the power to spend that money in any way that achieves that purpose. Authorisation for the actual expenditure is needed, whether that authorisation is by way of legislation or pursuant to the executive power of the Commonwealth. In Williams v Commonwealth (‘Williams [No 1]’), a majority of the High Court held that the executive power of the Commonwealth does not extend to expenditure in relation to any activity or cause that could be, but is not, the subject of Commonwealth legislation – that is, the Commonwealth has no general executive power to spend money in any area of Commonwealth legislative competence. This decision was motivated by concerns to preserve federalism and responsible government, and avoid the threat to each that bypassing the legislature, and more particularly the Senate, was considered to pose.
In response, the Commonwealth quickly set about putting its various spending schemes on a statutory footing, by inserting the name of each arrangement, grant or program and a very broad description of it into what are now called the Financial Framework (Supplementary Powers) Regulations 1997 (Cth). These regulations are purportedly authorised by what is now called the Financial Framework (Supplementary Powers) Act 1997 (Cth). I have previously written about the curious choice of procedure for providing this statutory footing. But the High Court, in Williams v Commonwealth [No 2], did not invalidate the Commonwealth’s approach as a whole. Rather it found that the listing of the particular arrangement challenged in that case, the National School Chaplaincy and Student Welfare Program, was not a law authorised by any head of legislative power. This approach left each program in the Regulations to be challenged on a case by case basis.
This brings us to the SOCM scheme. It is clearly the kind of scheme the constitutional validity of which was put in doubt by Pape and Williams [No 1]. So, is the scheme constitutionally valid?
One thing is certain: the validity of the scheme will not be saved by clause 1.5(2) of the Guidelines, which states that ‘[g]rants under schemes covered by these guidelines may only be made where the proposed expenditure falls within the scope of Commonwealth constitutional spending power’. Such a clause only restates the law; it does nothing to provide constitutional validity where it was lacking. The scheme’s validity, or lack thereof, lies in the application of the existing law.
Let’s assume that a law authorising a scheme for such a purpose could be made by the Commonwealth Parliament pursuant to the external affairs power in s 51(xxix), on the basis that it involves actions of the Commonwealth external to Australia. There is no present substantive Act of Parliament that establishes the SOCM scheme. The scheme, by its name, is not specifically listed in the Regulations. However, it might fall within item 402.006 of Part 3 of Schedule 1AA to the Regulations. This item is entitled ‘Financial assistance toward legal costs and expenses’ and its stated objective is ‘[t]o provide funding for legal costs and disbursements in proceedings involving Commonwealth law, or in circumstances that give rise to a special Commonwealth interest’. The proceedings assisted by the SOCM scheme cannot fall within ‘proceedings involving Commonwealth law’, as, by its very nature, the scheme only provides assistance in foreign criminal matters. Neither the Regulations nor the Guidelines contain any guidance as to what might be a ‘special Commonwealth interest’. Using the ordinary meaning of the word ‘special’, it is arguable that serious overseas criminal proceedings against Australians give rise to a ‘special Commonwealth interest’, since they are ‘special’ enough that the Commonwealth has deemed them to be worthy of public funding. It is also arguable that the item, at least insofar as it applies to the SOCM scheme, is a law with respect to external affairs. Being an area of Commonwealth legislative competence, external affairs is likely to be considered an area of ‘Commonwealth interest’. Collectively, these arguments could lead to the conclusion that serious overseas criminal matters are ‘circumstances that give rise to a special Commonwealth interest’ for the purposes of item 402.006. If listing the scheme in the Regulations would be sufficient parliamentary authorisation of the scheme, item 402.006 might suffice to ensure the scheme’s constitutional validity. However, whether listing schemes in the Regulations has this effect has not yet been decided by the High Court.
If item 402.006 does not authorise the SOCM scheme, would it nonetheless be authorised under the executive power of the Commonwealth? Pre-Pape, schemes of this broad kind (though for legal assistance within Australia) were considered by the Federal Court and their constitutional validity was not questioned. In Ex-Christmas Islanders v Attorney-General, French J (then sitting on the Federal Court) said that ‘[t]he expenditure is ultimately authorised by the relevant Appropriation Acts’ (189–190 [93]). This statement was made in the course of establishing that the scheme did not operate ‘under an enactment’ for the purposes of determining the matter under the Administrative Decisions (Judicial Review) Act 1977 (Cth), rather than in relation to any constitutional challenge to the scheme. Obviously, in light of the decision in Pape that an appropriation Act alone does not authorise expenditure, the statement no longer represents the law. Such pre-Pape cases say nothing about alternative bases for constitutional validity.
Following the High Court’s decision in Williams [No 1], it is no longer sufficient that a law authorising the scheme could be made pursuant to the external affairs power if no such law has not actually been made. There are doubts that there are other categories of executive power that could support spending in the absence of statutory authorisation. For example:
Could a payment administered by the Attorney-General’s Department to an Australian individual overseas, or his or her legal team, constitute the exercise of the non-statutory executive power to conduct foreign affairs?Could the payment of legal expenses for the benefit of an Australian citizen charged with a serious crime constitute an activity ‘peculiarly adapted to the government of a nation and which cannot otherwise be carried on for the benefit of the nation’, (a test for legitimate executive activity where supported by incidental legislation that was advanced by Mason J in the AAP case and applied by a majority of the High Court in Davis v Commonwealth and Pape)?Would the SOCM scheme, or any agreements or payments made pursuant to it, fall within the ordinary administration of the Attorney-General’s Department for the purposes of s 64 of the Constitution (a formulation accepted by a several members of the High Court in Williams [No 1] and in academic commentary by a former Justice)?
The constitutional validity of the scheme is therefore not a foregone conclusion. However, it would take a plaintiff with standing—which, based on recent approaches by the High Court to standing in constitutional law matters, is a study all in itself—willing to challenge the scheme to test it.
It is more likely that an applicant under the scheme would seek to challenge a decision to refuse to provide financial assistance. The implementation of schemes such as this also raise a host of administrative law issues, some of which I address, in general terms, in the recent ‘Executive Power’ issue of the UWA Law Review. It is often difficult to challenge decisions made under a non-statutory scheme such as the SOCM scheme, which operates purely in accordance with guidelines that lack legal effect. As French J pointed out in Ex-Christmas Islanders v Attorney-General, there is ‘no legal duty’ to do any of the things purportedly required by such guidelines that could be enforced by a judicial review remedy.
Concluding remarks
The Commonwealth could shore up the SOCM scheme’s constitutional validity by passing legislation that expressly authorises it. But, given the difficulties for applicants looking to challenge decisions made solely under such schemes, perhaps the Commonwealth is willing to gamble on constitutional validity to ensure administrative expediency. Not all of the 776 schemes presently on foot necessarily labour under the same kind of constitutional cloud as the SOCM scheme, but that’s still quite the brave gamble.
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Amanda Sapienza is a PhD Candidate at the University of Sydney, examining judicial review of non-statutory executive power. She is grateful to Prof Anne Twomey and Dr Lisa Burton Crawford for useful discussions in the formulation of this piece. Any errors are Amanda’s own.
Suggested citation: Amanda Sapienza, ‘Does the ‘Serious Overseas Criminal Matters’ scheme have serious legal issues?’ on AUSPUBLAW (9 April 2018) <https://auspublaw.org/blog/2018/04/serious-overseas-criminal-matters-scheme/>