2017 ‘On Just Terms’, Revisited 225
constitutional guarantee, then a different approach is required.
In developing this
argument, the article isolates two key features of s 51(xxxi) that make it unusual from a
comparative perspective: first, its lack of guidance regarding the scope of co nstitutional
protected afforded to property rights; and second, its lack of explicit reference to
‘compensation’ in describing the relevant constitutio nal obligation. The significance of
this comparative lens is t hat it helps reposition s 51(xxxi) vis-à-vis the US Constitution’s
Fifth Amendment ‘taking s clause’. The High Court has frequently invoked the takings
clause as a foil in defending the current chara cterisation approach. In particular, the
Court has long insisted that s 51(xxxi)’s reference to the ‘acquisition’ of property, as
opposed to the ‘taking’ of property, justifies the use of characterisation anal ysis.
This article takes that claim to task. It will demonstrate that in one respect the
differences between the two property clauses have been overstated, a nd that in another
respect they have been overlooked. The differences have been oversta ted in that both
property clauses are unusual in the lack of guidance that they provide. At the same time,
the most significant difference between the two property clauses has been overlooked:
whereas the takings clause, like most other property clauses, ref ers to a requirement of
‘just compensation’ when property rights are burdened in the relevant way, s 51(xxxi)
uses the phrase ‘on just ter ms’ and makes no explicit reference to compensation.
Repositioning s 51(xxxi) in comparative perspective thus invites critical examination of
the High Court’s self-consciously comparative defence of characterisation analysis. By
undertaking that examination, this article is able to provide a more precise diagnosis of
the problem with the current characterisation approach, and to identify a way forward
that responds to that diagnosis.
There are two parts to the argument. The first part is critical. It deepens existing
critiques through the use of comparative analysis as a diagnostic tool.
how Australian and American constitutional property jurisprudence have converged on
a ‘definitional’ approach to the problem of so-called ‘regulatory expropriations’—the
problem of determining when the state must pay co mpensation for the expropriative
consequences of its otherwise legitimate regulatory activities. Definitional approaches
frame this problem in absolute terms: if a constitutionally relevant burden on pr operty
rights exists, then compensation is required; there is no further question about whether
the burden is justified. The article shows how the use of a definitional approach has led
to similar pr oblems in both jurisdictions, notwithstanding the fact that defining the
concept of the relevant burden is approached by using rights analysis in the United
States and by using characterisation analysis in Australia. Thus, whereas existing
jurisprudential critiques of s 51(xxxi) focus on the High Court’s inattention to the
provision’s underlying purpose and the values that it protects—a conse quence of using
characterisation analysis instead of rights analysis—the article will demonstrate that this
is only one aspect of the problem.
The status of s 51(xxxi) as a constitutional guarantee has been doubted by at least some
commentators: see Rosalind Dixon, ‘Overriding Guarantee of Just Terms or Supplementary
Source of Power?: Rethinking s 51(xxxi) of the Constitution’ (2005) 27 Sydney Law Review 639.
As noted in the conclusion of this article, another possible response to the critique developed
in this article would be to abandon the constitutional guarantee thesis.
It bears emphasis that the purpose of comparison is critical: the analysis does not purport to
be explanatory in the sense of causal or inference-driven. Case-selection principles that
govern inference-oriented explanatory studies therefore do not apply.