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Learning outcomes

By the end of this topic you will be able to:

draw on your background of knowledge of sources of Australian Law when

studying commercial law

refer to these foundations in your legal research as an undergraduate.

Introduction to Legal Research

It is a good idea to check through Introduction to Legal Research before

beginning to work through these modules, as this gives you a comprehensive

overview of the many legal resources available to you, how best to use theseresources and excellent practical advice about effective searching methodologies.

Copyright notice. Excepting external documents referenced, all web content is Copyright 2005 RMIT

University. Disclaimer About Privacy.

Click play for information about this module from your

course coordinator, Mary Toohey.

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Classification of law

The 'law' can be classified in many different ways. One helpful method is to use

the modern definition of separating law into 'enacted' or 'Parliament' made lawand 'unenacted' or 'judge' made law.

A more traditional approach is to classify the law by examining what specific

areas it deals with.

For example:

i. civil and criminal law

ii. historical division of law into principles of common law and equity.

Civil law is generally what this course is all about - individuals suing one another,

usually over commercial matters.

Criminal law is where the police, or the crown, or government authorities are

involved. They are prosecuting an individual for a crime that person is accused

of.

There is also a further division based on geographical limits. For example,

England and her ex-colonies are seen to have a common law system, whereas

other European states have a civil code system. See, for example, the Roman

Civil Code and The Napoleonic Code.



Reading

Latimer 1-180

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Sources of law - Legislation

Australian states have their own constitutions and generally the states are

authorised to make laws "for the peace, order and good government" of thestate. However these wide legislative powers given to the state parliaments must

be understood in the light of the Commonwealth constitution.

Australia as a political entity was established by the Commonwealth of Australia

Constitution Act 1900, an Act of the Imperial British Parliament and the

Commonwealth Constitution, was a schedule attached to the Act.

The Commonwealth Constitution gave the Commonwealth parliament both

concurrent and exclusive legislative powers. Concurrent powers are those

legislative powers shared with the States. An example of this is education.Section 51 of the Constitution is considered to be the main source of concurrent

powers, although some of these powers are effectively exclusive powers by virtue

of Section 109. Section 109 states if that if there is any inconsistency between

Federal and states laws (concurrent laws), the Federal laws will prevail.

Exclusive powers are legislative powers set out in the Constitution that are only

to be utilised by the Commonwealth government, eg Section 52 and Section 90.

If there are powers not listed in the Commonwealth Constitution, these may be

regarded as residual and are therefore the domain of the State legislatures.



Reading

Latimer 1.200 - 1.340

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Delegated legislation

Delegated legislation is also referred to as subordinate or secondary

legislation.

The empowering Act delegates the authority to make regulations, rules and by

laws to the people and groups such as Governor in Council, government

ministers and statutory authorities.

Delegated legislation must come within the legislative powers conferred in the

empowering Act, or the resultant delegated legislation may be declared Ultra

Vires and therefore invalid.

Delegated legislation is tabled in Parliament but is not subject to the same

scrutiny and parliamentary procedures that occurs with statutes, however at both

Federal and State level, parliamentary committees examine delegated legislation

that is tabled in parliament to ensure that there is consistency and coherence.



Reading

Latimer 1.180

Delegated legislation is enacted law made under the authority of an

Act of Parliament. This Act is often referred to as the 'empowering Act'.

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Sources of law - Common law

Common law includes:

i. decisions made by judges where no legislation applies, for example

contract law and negligence. In other words common law was developed

by judges who followed their own decisions and those of fellow judges in

similar cases.

ii. judges interpretations of particular statutes and regulations. Once

parliament passes a law, there is no recourse back to parliament to ask

them what they meant by the particular law that they have passed.

Therefore, it is left to the courts to interpret the meaning of legislation.

Common law is found in the decisions of judges of the senior courts. These

decisions are found in the law reports e.g. C.L.R. (Commonwealth Law Reports),

V.R. (Victorian Reports) , and N.S.W.L.R (New South Wales Law Reports). The

law reports were traditionally compilations of cases from a particular court, orgroup of courts, taken over a period of time. The cases were bound into large

volumes and usually accessed through law libraries. These days law reports are

now more readily available through CDs and internet sources.

Each case has a citation (or reference), which is used in the citing of the case

that supports a legal principle. Examples are found in your text.

The citation follows the name of the litigants and tells us that the case was

decided in1987, that the case was decided by the High Court (CLR refers to

Commonwealth Law Reports which reports High Court decisions), and that the

case is reported in volume 76 commencing at page 387.



Reading

Latimer 1-350--1-370

Definition of Common Law

Laws made by judges in adjudicating disputes, often referred to as case

law.

Case law

Waltons Stores Interstate Ltd v Maher (1987)76 CLR 387.

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Sources of law - Equity

Equity is a form of common law or 'judge made law ' that was developed to

overcome some of the shortcomings of the common law system.

Common law did not provide many causes of action and restricted remedies

mainly to monetary compensation.

The Courts of Chancery were established in England to administer the principles

of equity through the legal system.

Today equity and common law are joined together in the one court system,

however the principles of equity are still used and have some impact on business

law.



Reading

Latimer 1-010

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The doctrine of Precedent

Common Law refers to the legal principles found in the decisions of the courts. It

is important that similar cases have similar outcomes to promote consistency andjustice within the legal system.

The doctrine of precedent ensures some consistency of decisions as the concept

of precedent involves courts following previous decisions of senior courts.

Two forms of precedent exist:

i. Binding precedent (traditionally referred to as star decisis):

A decision from a more senior court in the same hierarchy of courts

binds judges in lower courts to follow that decision of the senior court.The facts of the cases must be substantially similar.

ii. Persuasive precedent

Decisions from courts in other jurisdictions or lower courts in the

same hierarchy which need not be followed by other courts but can be

used as a guide when deciding similar fact cases. Persuasive

precedent may also be the 'obiter dicta', being merely observations of

the court, which were not the basis of the court's decision.



Reading

Latimer 1-400

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Precedent / Ratio Decidendi / Obiter Dicta

In cases of binding precedent, not all of the judgement is binding. The only

binding aspect of the case is the 'ratio decidendi'- the legal reason for thedecision.

A judge deciding a case may make other statements of law relating to the case

and the legal arguments presented by the parties, however these statements

may only be 'obiter dicta' and are not the judges legal reason for the decision.

Determining the ratio and the obiter can be a difficult task, however it is

important that courts relying on precedent identify the correct ratio decidendi.

This helps to avoid a party appealing against the decision on the basis of an

incorrect interpretation of the precedents.

Precedents only operate where there are similar circumstances between the

precedent and a current case. Sometimes there may be small but significant

differences between the cases, so in these circumstances the judges may

'distinguish' on the facts.



Reading

Latimer 1-380

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Precedent and the Australian court

The operation of precedent relies on a hierarchy of courts. The key to a binding

precedent is the senior courts making decisions that are followed at a later timeby lower courts in the same hierarchy.

The Australian court hierarchy includes federal and state courts. An

understanding of the Federal and State court hierarchy is necessary to appreciate

the operation of precedent in the Australian context.

The Australian state courts

Reading

Latimer 1-380

Reading

Latimer 1-070

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Each state has its own court hierarchy, however the structures are similar to

each other.

Magistrate's Court

This court is the lowest court in the hierarchy and generally hears minor civil

matters , such as one person suing another, e.g. regarding a car accident. The

Magistrate's Court has a summary jurisdiction in criminal matters. This means

that juries do not sit in criminal matters in the Magistrate's Court and the

criminal matters heard are regarded as relatively minor. Magistrates also sit in

specialised courts, such as the Coroner's and Children's Court. The Coroner's and

Children's Court are regarded as being on the same level in the hierarchy as the

Magistrate's Court.

County Court

This court is regarded as the intermediate court. The court's jurisdiction includes

hearing most indictable offences and in civil matters the court hears "unlimited"

personal injury claims and property damage claims up to $200,000. The County

Court also hears appeals from the Magistrate's Court in criminal matters.

Supreme Court

This is the highest court in the state hierarchy, with unlimited jurisdiction in civil

and criminal matters (as set out in statute). The court also hears appeals from

the lower courts and also has a permanent Court of Appeal to hear appeals from

the Supreme Court in its original jurisdiction.

The Australian Federal court system

The Commonwealth also has its own hierarchy of courts. The lowest court in this

hierarchy is the Federal Magistrate's Court.

The Federal Magistrates Court

Latimer 1-080

Latimer 1-090

Reading

Latimer 1-070

Latimer 1-110

Latimer 1-100

Latimer 1-140

Latimer 1-130

Latimer 1-160




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This court was established in the year 2000 and has jurisdiction in federal areas

of law, for example bankruptcy, and trade practices, with claims of up to

$200,000.

The Federal Court

This court was established in 1976 and has original and appellate jurisdiction to

hear matters arising out of federal law, for example to do with bankruptcy,

taxation and trade practices. Note the Full Court of the Federal Court is an

appellate court, which hears appeals from a single judge of the Supreme Court,the Supreme Courts of the Territories and the State Courts exercising federal

jurisdiction.

Family Court

This is a specialised court dealing with marriage breakdowns, property

settlements and residential and custodial arrangements affecting the children of

broken down marriages.

High Court

This is the most senior court in the federal court system. Specifically it has three

main functions:

1. special original jurisdiction; this allows it to hear disputes between states

and between the commonwealth and states.

2. final Court of Appeal within the Australian legal system;

3. guardian and interpreter of the Australian Constitution.

Note: There are also numerous administrative bodies, tribunals and arbitration

bodies under both the State and federal system.






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Civil and criminal law

Before leaving this introductory module, some discussion is needed of the words

'criminal' and 'civil '. Students very often confuse the terminology between civil

and criminal matters. The legal terminology differs from criminal to civil, so a

clear understanding is needed of the 'correct' language.

In criminal matters, the following words are important:

accused

defendant

prosecuting

prosecutor

penalty

conviction

beyond reasonable doubt.

These terms are not used when referring to civil matters.

Criminal cases are referred to in the following way:

In Civil cases the following words are important. Make sure you know the

definition and use of each:

Plaintiff

applicant

defendant

sue

remedy

damages

appellant

R v Smith

This indicates an indictable criminal offence. Note: "R" refers to the

Crown as prosecuting and Smith is the one accused of the offence.

Smith v R

This indicates an indictable criminal matter on appeal.

Lee(informant) v Smith

This indicates a summary offence. The informant may be a police officer,

by-laws officer or health inspector.

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respondent

On the balance of probabilities.

Civil cases are referred to in the following way:



Smith v Brown

This indicates that Smith is the Plaintiff and Brown the defendant.

Note: if Brown appeals against a decision, Brown becomes the Appellant

and the appeal case will be cited as Brown v Smith.

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