Hostname: page-component-745bb68f8f-grxwn Total loading time: 0 Render date: 2025-01-30T23:24:53.508Z Has data issue: false hasContentIssue false
  • English
  • Français

Public Trusts, Public Fiduciaries

Published online by Cambridge University Press:  24 January 2025

Paul Finn
Paul Finn*
Affiliation:
Federal Court of Australia
Get access Rights & Permissions [Opens in a new window]

Extract

In 1995 I wrote a short piece entitled ‘The Forgotten “Trust”: The People and the State’. Its premise was the simple proposition that the most fundamental of fiduciary relationships in our society is that which exists between the State (and its officers and agencies) and the community (the people). I do not intend here to revisit the justifications for that proposition. My primary concern when I wrote was with two quite different legal manifestations of that proposition. The first was its use in informing and justifying the imposition of legally enforceable standards of conduct on public officers and agencies. The second was how trust and fiduciary ideas have been, and could be, invoked to circumscribe and channel the exercise of public power for the benefit or protection of the public or a section of it. It is the second – and much more problematic – of these that I wish to revisit in this article. I do so not simply to satisfy Leslie Zines that I have reconsidered a ‘heresy’ into which he believed I was misguidedly lured.

Type
Research Article
Information
Federal Law Review , Volume 38 , Issue 3 , September 2010 , pp. 335 - 351
Copyright
Copyright © 2010 The Australian National University

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Paul, Finn, ‘The Forgotten “Trust“: The People and the State’ in Malcolm, Cope (ed), Equity: Issues and Trends (1995)Google Scholar ch 5.

2 Cf Aboriginal Development Commission v Treka Aboriginal Arts and Crafts Ltd (1984) 3 NSWLR 502 where no trust was found.

3 See, eg, Registrar of the Accident Compensation Tribunal v Commissioner of Taxation (Cth) (1993) 178 CLR 145; cf Authorson v Attorney-General (Canada) (2002) 215 DLR (4th) 496 which the relationship found was properly characterised as fiduciary only, in the circumstances; see also Swain v Law Society [1983] 1 AC 598.

4 See, eg, Cubillo v Commonwealth (2001) 112 FCR 455, [460].

5 Nationwide News Pty Ltd v Wells (1992) 177 CLR 1, 72 (Deane and Toohey JJ). See also Paul, Finn, ‘A Sovereign People, A Public Trust’ in Paul, Finn (ed), Essays on Law and Government (1995) vol 1, 1Google Scholar; popular sovereignty, a powerful fiction, can be regarded as a vehicle for sustaining the government of the many by the few: see generally Edmund, Morgan, Inventing the People: The Rise of Popular Sovereignty in England and America (1988)Google Scholar; see also Edmund, Morgan, American Heroes: Profiles of Men and Women Who Shaped Early America (2009)Google Scholar ch 15.

6 Finn, ‘The Forgotten “Trust“: The People and the State', above n 1, 141.

7 See Stephen, Gageler, ‘Beyond the Text: A Vision of the Structure and Function of the Constitution’ (2009) 32 Australian Bar Review 138Google Scholar; Harley, Wright, ‘Sovereignty of the People — the New Constitutional Grundnorm?’ (1998) 26 Federal Law Review 165Google Scholar. I am aware that the proposition I have stated is not uncontentious: see George, Winterton, ‘Popular Sovereignty and Constitutional Continuity’ (1998) 26 Federal Law Review 1Google Scholar.

8 Saeed v Minister for Immigration and Citizenship (2010) 84 ALJR 507, [58] (French CJ, Gummow, Hayne, Crennan and Kiefel JJ).

9 See, eg, the extortion provisions of the Statute of Westminster The First 1275, 3 Edw 1, c 5, which influence the common law to this day; see, eg, James, Lindgren, ‘The Elusive Distinction between Bribery and Extortion: From the Common Law to the Hobbs Act’ (1987–1988) 35 University of California at Los Angeles Law Review 815Google Scholar.

10 R v Bembridge (1783) 22 State Tr 1, 155–6.

11 R v Whitaker [1914] 3 KB 1283, 1296.

12 Cf Lane v Cotton (1701) 1 Ld Raym 646, 648.

13 See, eg, Driscoll v Burlington-Bristol Bridge Co 86 A 2d 201, 222–3 (1952) which, though a modern case, captures much of the essence of the early law, albeit with a more explicitly republican sentiment than was open to the 18th century English judiciary: see Finn, ‘The Forgotten “Trust“: The People and the State', above n 1, 133.

14 See R v Bembridge (1783) 22 State Tr 1, 155–6.

15 Paul, Finn, ‘Official Misconduct’ (1978) 2 Criminal Law Journal 307Google Scholar.

16 Paul, Finn, Law and Government in Colonial Australia (1987) 19–24Google Scholar. The action on the case for, variously, deceit, misfeasance and non-feasance in office was the usual vehicle for imposing tort liability on officials as such: see, eg, the classifications adopted in SirJohn, Comyns, A Digest of the Laws of England (4th ed, 1800) vol 1, 226Google Scholar ff, 274 ff, 279 ff. Almost all of this law passed from memory in Anglo-Australian law, although an aspect of it was to be unfaithfully recreated in the modern tort of misfeasance in public office: see Northern Territory v Mengel (1995) 185 CLR 307, 345 ff. In the US, in contrast, it retained its vitality: see, eg, Floyd R Mechem, A Treatise on the Law of Public Offices and Officers (1890) §§ 585–682.

17 Cf R v Boston (1923) 33 CLR 386, 412.

18 Horne v Barber (1920) 27 CLR 494, 502.

19 See the illuminating article, John, Barrat, ‘Public Trusts’ (2006) 69 Modern Law Review 514, 517–25Google Scholar.

20 See, eg, Attorney-General v Edmunds (1868) LR 6 Eq 381.

21 As witness the tortured reasoning in Reading v Attorney-General [1949] 2 KB 232; affirmed in Reading v Attorney-General [1951] AC 507. The contrast in this with US law is marked: see Finn, ‘The Forgotten “Trust“: The People and the State', above n 1, 148–9.

22 The number of reported public officer/tort cases is few: see, eg, Fitzgerald v Boyle (1861) 1 QSCR 19; Brayser v MacLean (1875) LR 6 PC 398; Lemme v Krone (1890) 16 VLR 613; Chichester v Marine Board of South Australia [1910] SALR 22; Farrington v Thomson and Bridgland [1959] VR 286. A partial explanation of this may well have been the early enactment in the Australian colonies of Claims against the Government legislation beginning in Queensland in 1866.

23 For example, R v Boston (1923) 33 CLR 386. For an extended treatment of the public trustee status of MPs and of the standards of conduct imposed on them, see Gerard Carney, Members of Parliament: Law and Ethics (2000) ch 7–12.

24 Wood v Little (1921) 29 CLR 564.

25 See Queensland, Commission of Inquiry into Possible Illegal Activities and Associated Police Misconduct, Final Report (1989).

26 Western Australia, Royal Commission into the Commercial Activities of Government and Other Matters, Reports Part 1 and 2 (1992).

27 The numerous reports published by Queensland's post-Fitzgerald Electoral and Administrative Review Commission and WA's Commission on Government are eloquent of this.

28 See, eg, Pennsylvania Declaration of Rights 1776; Driscoll v Burlington-Bristol Bridge Co 86 A 2d 201, 222–3 (1952).

29 Relatively similar provisions are to be found in the Crime and Misconduct Act 2001 (Qld) and the Corruption and Crime Commission Act 2003 (WA); see generally Peter, Hall, Investigating Corruption and Misconduct in Public Office: Commissions of Enquiry – Powers and Procedures (2004)Google Scholar ch 1 and 2.

30 See, eg, Queensland, Electoral and Administrative Review Commission, Report on the Review of Codes of Conduct for Public Officials (1992)Google Scholar.

31 This is a subject of quite some interest in recent Canadian legal scholarship, although it must be accepted that fiduciary law in Canada has followed — and is following — quite different courses to that followed in Australia: see, eg, Breen v Williams (1996) 186 CLR 71; and most notably in relation to the Crown-aboriginal peoples relationship: see Delgamuukw v British Columbia [1997] 3 SCR 1010; Haida Nation v British Columbia [2004]3 SCR 511. See Evan, Fox-Decent, ‘The Fiduciary Nature of State Legal Authority’ (2005) 31 Queen's Law Journal 259Google Scholar; Lorne, Sossin, ‘Public Fiduciary Obligations, Political Trusts, and the Equitable Duty of Reasonableness in Administrative Law’ (2003) 66 Saskatchewan Law Review 129Google Scholar.

32 [2002] 1 AC 408, 416.

33 (2000) 20 Australian Bar Review 4, 5.

34 See, eg, Porter v Magill [2002] 2 AC 357, 463.

35 SirWilliam, Wade and Christopher, Forsyth, Administrative Law (9th ed, 2004) 354–5Google Scholar (emphasis added).

36 See also Hot Holdings Pty Ltd v Creasy (2002) 210 CLR 438, [135] where the purpose of the metaphor is openly acknowledged.

37 The convergence of the principles applied in different areas of law, eg statute and contract, is clearly perceptible: see, eg, Lion Nathan Australia Pty Ltd v Coopers Brewery Ltd (2005) 223 ALR 560, [79].

38 See, eg, Aharon Barak, Purposive Interpretation in Law (2005); CIC Insurance Ltd v Bankstown Football Club Ltd (1997) 187 CLR 384, 408.

39 Saeed v Minister for Immigration and Citizenship [(2010)]84 ALJR 507, [11] (French CJ, Gummow, Hayne, Crennan and Kiefel JJ).

40 Purposive construction itself can be used to this end. For an excellent example, see the dissenting judgment of Kiefel J in Griffiths v Minister for Lands, Planning and Environment (2008) 235 CLR 232.

41 See Dennis, Pearce and Robert, Geddes, Statutory Interpretation in Australia (6th ed, 2006)Google Scholar [9.2]–[9.4]; Minister Administering the Crown Lands Act v NSW Aboriginal Land Council (2008) 237 CLR 285 (Kirby J).

42 Evans v New South Wales (2008) 168 FCR 576, 593.

43 SirPeter, Maxwell, On the Interpretation of Statutes (4th ed, 1905) 122Google Scholar. See Potter v Minahan (1908) 7 CLR 277, 304; Bropho v Western Australia (1990) 171 CLR 1, 18; Coco v The Queen (1994) 179 CLR 427, 437.

44 Sutherland, Statutes and Statutory Construction (5th ed, 1992) vol 3Google Scholar, § 61.04.

45 See Griffiths v Minister for Lands, Planning and Environment (2008) 235 CLR 232, [106]–[108], [152] (Kirby J); Gould v Greylock Reservation Commission 215 NE 2d 114 (1966); Kootenai Environmental Alliance Inc v Panhandle Yacht Club Inc 671 P 2d 1085 (1983); and see Joseph, L Sax, ‘The Public Trust Doctrine in Natural Resource Law: Effective Judicial Intervention’ (1969–1970) 68 Michigan Law Review 471Google Scholar, 491 ff, 559–60.

46 R v Secretary of State for the Home Department; Ex parte Simms [2000] 2 AC 115, 131.

47 Ibid.

48 Western Australia v Commonwealth (1995) 183 CLR 373, 423 ('Native Title Act Case’).

49 (1992) 175 CLR 1, 64. For a recent application of this see, eg, Akiba v State of Queensland (No 2) [2010] FCA 643, [768].

50 Discussed below.

51 One could now add to this, though with some qualification, the review of contractual powers and discretions: see Jeannie, Paterson, ‘Implied Fetters on the Exercise of Discretionary Contractual Powers’ (2009) 35 Monash University Law Review 45Google Scholar.

52 The extent of this commonality in many of the grounds of judicial review has been often noted and explanations proffered for the phenomenon: see, eg, James, Spigelman, ‘The Equitable Origins of the Improper Purpose Ground’ in Linda, Pearson, Carol, Harlow and Michael, Taggart (eds), Administrative Law in a Changing State: Essays in Honour of Mark Aronson (2008) 147Google Scholar; SirAnthony, Mason, ‘The Place of Equity and Equitable Remedies in the Contemporary Common Law World’ (1994) 110 Law Quarterly Review 238, 238Google Scholar; Geraint Thomas, Powers (1998), vii; Paul Finn, Fiduciary Obligations (1977) [26]; see also Edge v Pensions Ombudsman [2000] Ch 602, 627–30; Equitable Life Assurance Society v Hyman [2002] 1 AC 408, 416–17.

53 On the review of fiduciary and powers see generally Richard, C Nolan, ‘Controlling Fiduciary Power’ (2009) 68 Cambridge Law Journal 293Google Scholar; Thomas, above n 52, ch 6. It is fair to say that the equitable grounds are, today, less developed than their administrative law counterparts: see, eg, the comments of Park J in Breadner v Granville-Grossman [2001] Ch 523, [58].

54 In the case of fiduciaries this duty only applies insofar as they have powers conferred on them in their fiduciary capacity: see Thomas, above n 52, 25; see also Austin and Ian, Ramsay, Ford's Principles of Corporations Law (14th ed, 2010)Google Scholar [8.070] ff.

55 See John, Lehane, ‘Delegation of Trustees’ Powers and Current Developments in Investment Funds Management’ (1995) 7 Bond Law Review 36Google Scholar, 36–8.

56 See Geraint, Thomas, ‘The Duty of Trustees to Act in the “Best Interests” of their Beneficiaries’ (2008) 2 Journal of Equity 177Google Scholar and the cases and literature there discussed.

57 See, eg, Trustee Act 1925 (NSW) s 14B(2)(a) which is replicated in all Australian jurisdictions; Corporations Act 2001 (Cth) s 181(1)(a); cf Superannuation Industry (Supervision) Act 1993 (Cth) s 52(2)(c) for a variant; and see Rouse v IOOF Australia Trustees Ltd (1999) 73 SASR 484, [101]; contrast Companies Act 2006 (UK) s 172; see Andrew, Stafford and Stuart, Ritchie, Fiduciary Duties: Directors and Employees (2008)Google Scholar [2.118]–[2.120].

58 See Thomas, above n 52, 25–6.

59 That is, a prescribed capacity to do a specified act or to make a specified decision, that capacity being conferred expressly or impliedly by the instrument under which the authority so to act is conferred.

60 That is, the person is a fiduciary in the strict legal sense.

61 See generally Finn, above n 52, ch 2; Thomas, above n 52.

62 (1882) 7 App Cas 619.

63 Registrar of the Accident Compensation Tribunal v Federal Commissioner of Taxation (1993) 178 CLR 145, 162-3. The usefulness of the ‘higher/lower sense’ dichotomy has been doubted in Canada, see Guerin v The Queen (1984) 13 DLR (4th) 321, 357, though the distinction is still honoured in Canadian law: see Donovan, W M Waters, Waters’ Law of Trusts in Canada (3rd ed, 2005) 30–31Google Scholar; Peter, W Hogg and Patrick, J Monahan, Liability of the Crown (3rd ed, 2000) 258-9Google Scholar which describes a trust in the higher sense as ‘a nothing'; in Australia see Peter Young, Clyde Croft and Megan Smith, On Equity (2009) [7.530].

64 Ibid 163.

65 Our principles of contract construction track that of statutory interpretation: see, eg, Franklins Pty Ltd v Metcash Trading Ltd [2009] NSWCA 407, [239] – [305].

66 See Judiciary Act 1903 (Cth) s 64.

67 See Bathurst City Council v PWC Properties Pty Ltd (1998) 195 CLR 566 ('Bathurst City Council’); as to this last species of ‘trust’ — which is not a trust in the strict sense of the term — the High Court has accepted that a public body may be so restricted in the statutorily permitted use it can make of public property vested in it as to be required to hold it on trust for the statutorily permitted purposes. So in Bathurst City Council (1998) 195 CLR 566 land used for a car park and vested in the Council as ‘community land’ under the provisions of the Local Government Act 1993 (NSW) was held to be trust property in its hands subject to the limitations on permissible use and disposition of such land prescribed in the Act.

68 Itself a beneficial and, with respect, an orthodox development. It does open up potentially issues of standing if the Attorney-General of the jurisdiction in question abjures his or her supervisory responsibility: cf Bathurst City Council (1998) 195 CLR 566, [67].

69 See Brian, Preston, ‘The role of the Judiciary in Promoting Sustainable Development: The Experience of Asia and the Pacific’ (2005) 9 Asia Pacific Journal of Environmental Law 109, 203–10Google Scholar.

70 See, eg, Illinois Central Railroad Co v People of the State of Illinois, 146 US 387 (1892) — the landmark case.

71 See Tim, Bonyhady, ‘A Usable Past: The Public Trust in Australia’ (1995) 12 Environmental and Planning Law Journal 329Google Scholar.

72 The modern progenitor of it was Joseph L Sax's highly influential article ‘The Public Trust Doctrine in Natural Resource Law: Effective Judicial Intervention’ (1970) 68 Michigan Law Review 471.

73 Though by no means uncontroversial: see generally, Tim, Bonyhady, The Law of the Countryside (1987)Google Scholar.

74 See Illinois Central Railroad Co v People of the State of Illinois, 146 US 387 (1892).

75 M.C. Mehta v Kamal Nath (1997) 1 SCC 388, [34].

76 See Donovan, W M Waters, ‘The Role of the Trust in Environmental Protection Law’ in Donovan, W M Waters (ed), Equity, Fiduciaries and Trusts (1993) 383, 385–6Google Scholar.

77 See Gould v Greylock Reservation Commission, 215 NE 2d 114 (1966).

78 See, eg, Mary, Wood, ‘Advancing the Sovereign Trust of Government to Safeguard the Environment for Present and Future Generations (Part I): Ecological Realism and the Need for a Paradigm Shift’ (2009) 39 Environmental Law 43Google Scholar; Mary, Wood, ‘Advancing the Sovereign Trust of Government to Safeguard the Environment for Present and Future Generations (Part II): Instilling a Fiduciary Obligation in Governance’ (2009) 39 Environmental Law 91Google Scholar.

79 See Gould v Greylock Reservation Commission, 215 NE 2d 114 (1966); but see also, for a lesser but nonetheless heightened standard of review: Kootenai Environmental Alliance Inc v Panhandle Yacht Club Inc, 671 P 2d 1085 (1983).

80 (1989) 168 CLR 314, 330.

81 See also Northern Territory v Arnhem Land Aboriginal Land Trust (2008) 236 CLR 24; but cf Bonyhady, above n 73, 251–53; see also Akiba v Queensland (No 2) [2010] FCA 643 at [777]–[846].

82 (2009) 175 FCR 350.

83 56 Fed Cl 720 (2003).

84 My own view is outlined in ‘The Fiduciary Principle’ in Timothy, G Youdan (ed), Equity, Fiduciaries and Trusts (1989)Google Scholar.

85 I again emphasise I leave out of account those cases where for reasons of contract or voluntarily assumed responsibility a public body enters into a relationship which is in fact a fiduciary one: see Northern Land Council v Commonwealth of Australia (1987) 75 ALR 210, 214–5.

86 Wik Peoples v Queensland (1996) 187 CLR 1, 96.

87 See Young, Croft and Smith, above n 63, [7.30].

88 Cf Bromley London Borough Council v Greater London Council [1983] 1 AC 768, 815.

89 (2001) 112 FCR 455, 576; see also Bennett v Minister of Community Welfare (1992) 176 CLR 408, 426–7.

90 (1984) 13 DLR (4th) 321.

91 (1996) 187 CLR 1, 96.

92 (2009) 175 FCR 350, [53].

93 56 Fed Cl 720, 753 (2003).

94 See, eg, Morongo Band of Mission Indians v Federal Aviation Administration, 161 F 3d 569, 573–74 (1998); Northwest Sea Farms Inc v United States Army Corps of Engineers, 931 F Supp 1515 (1996); Skokomish Indian Tribe v Federal Energy Regulatory Commission, 121 F 3d 1303, 1308–9 (1977).

95 I earlier gave negative illustrations of this in the context of United States Indian cases.

96 [1983] 1 AC 508, 618.

97 [1983] 1 AC 768.

98 Ibid 815.

99 Mackenzie District Council v ECNZ [1992] 3 NZLR 41.

100 See Wellington City Council v Woolworths NZ Ltd (No 2) [1996] 2 NZLR 537; Waitakere City Council v Lovelock [1997] 2 NZLR 385 (pace Thomas J); see generally Andrew, Butler (ed), Equity and Trusts in New Zealand (1st ed, 2003) 1106-12Google Scholar.

101 IW v City of Perth (1997) 191 CLR 1, 49.

102 See generally Barratt, above n 19.

103 Equitable Life Assurance Society v Hyman [2002] 1 AC 408, 416.

104 Jeffrey, L Jowell, Andrew, Le Sueur and Harry, Woolf, De Smith's Judicial Review (6th ed, 2007) 289–90Google Scholar.

105 Understandably, though, the “fiduciary duty” has been accepted by subordinate courts in the English judicial hierarchy — though less so the Scottish (see Commission for Local Authority Accounts in Scotland v Stirling DC (1984) SLT 442) — to have been incorporated into English law: see R (on the application of Western Riverside Waste Authority) v Wandsworth LBC [2005] EnvLR 41.

106 See, eg, Miccosukee Tribe of Indians of Florida v United States (1997) 980 F Supp 448, 461.

107 See Wik Peoples v Queensland (1996) 187 CLR 1, 96; see also Bennett v Commonwealth of Australia (2007) 231 CLR 91, [113]–[117]; for the position in New Zealand in relation to Maori see Andrew Butler (ed), Equity and Trusts in New Zealand (2nd ed, 2009) ch 43; see also New Zealand Maori Council v Attorney-General [2008] 1 NZLR 318.

108 As in New Zealand and, for the most part, in Canada.

109 As in Canada: see Constitution Act 1982 s 35(1); see also R v Sparrow (1990) 70 DLR (4th) 385, [59]:

the Government has the responsibility to act in a fiduciary capacity with respect to aboriginal peoples. The relationship between the Government and aboriginals is trust-like, rather than adversarial, and contemporary recognition and affirmation of aboriginal rights must be defined in light of this historic relationship.

110 Founded on their historical relationship, and the inalienability of their native title except by surrender to the Crown, its vulnerability to extinction by State action: cf Mabo v Queensland [No 2] (1992) 175 CLR 1, 202–3 (Toohey J).

111 This is not to say that in particular circumstances a fiduciary relationship may not be found between the State and particular aboriginal people on orthodox grounds: see Cubillo v Commonwealth (2001) 112 FCR 455; Northern Land Council v Commonwealth of Australia (No 2) (1987) 75 ALR 210; Bodney v Westralia Airports Corporation Pty Ltd (2000) 109 FCR 178, [4].

112 Bodney v Westralia Airports Corporation Pty Ltd (2000) 109 FCR 178; Griffiths v Minister for Lands, Planning and Environment (2008) 235 CLR 232, 271-2, [142]; see also Thorpe v Commonwealth [No 3] (1997) 71 ALJR 767, 775–6.

113 But cf Kirby J in Griffiths v Minister for Lands, Planning and Environment (2008) 235 CLR 232.

114 See the critical discussion in Andrew, Butler (ed), Equity and Trusts in New Zealand (2nd ed, 2009) 1265–6Google Scholar.

115 Taku River Tlingit First Nation v British Columbia (Project Assessment Director) (2004) 245 DLR (4th) 193, [24]. This duty is too complex to unpackage here but see Mitchell v Minister of National Revenue [2001] 1 SCR 911, [9]; Haida Nation v British Columbia (Minister of Forests) (2004) 245 DLR (4th) 33, [25], [27], [29], [32]; Mikisew Cree First Nation v Canada (Minister for Canadian Heritage) (2005) 259 DLR (4th) 610, [51].

116 See New Zealand Maori Council v Attorney-General [2008] 1 NZLR 318, 337.

117 Melbourne Steamship Co Ltd v Moorehead (1912) 15 CLR 333, 342.

118 But see Hughes Aircraft Systems International v Airservices Australia (1997) 76 FCR 151, 196–7.

119 (2008) 235 CLR 232.

120 (1908) 7 CLR 277.