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Saturday
Jan292011

Political speech blooms

High Court breathes fresh life into implied right of political speech ... Robert French's court opens intriguing new possibilities ... Stephen Keim and Mary Ayad examine Aid/Watch v Commissioner of Taxation

French CJ: Possibilities of a brave and beautiful tomorrow Strangely enough for a tax case the High Court has delivered a solid victory for implied freedom of speech.

In Aid/Watch Incorporated v Commissioner of Taxation the majority (French, Gummow, Hayne, Crennan and Bell) held the appellant was a charitable institution under s.50.5 of the Income Tax Assessment Act, 1997 - notwithstanding that its objects and activities are political.

Aid/Watch seeks to improve the lot of people in developing countries by ensuring that Australian and multi-national aid is not exploitative, is provided in consultation with local communities, does not destroy the local environment, and respects the human rights of the recipients.

The minority (Heydon and Kiefel) held that neither the objects nor the activities of Aid/Watch are charitable.

The Aid/Watch case shows just how crucial the laws relating to taxation and charities are to the wealth and power structures of society.

Many charitable organisations do excellent work by simply providing succour to those in need of food, shelter, health care and other essentials.

However, the causes of poverty also need to be addressed in order to achieve long-term, structural social improvement.

The idea of charity for which the Commissioner argued in the Aid/Watch case was restricted to the immediate relief of poverty.

It rejected attempts to reduce poverty by political action, which go to the root causes of the problem.

The majority found for the broader reading of charity. 

"This is because the generation by lawful means of public debate ... concerning the efficiency of foreign aid directed to the relief of poverty, itself is a purpose beneficial to the community."

The majority drew on the Constitutional doctrine of an implied right of free political speech developed in cases such as Lange v Australian Broadcasting Corporation.

Relying on provisions for representative and responsible government and a universal franchise in the Constitution, the majority found:

"Communication between electors and legislators and the officers of the executive, and between electors themselves, on matters of government and politics is 'an indispensable incident' of that constitutional system."

The majority pointed out that the relevant legislative provisions used language and concepts taken from the general law.

As a result, the construction question involved in the case did not depend on the words of the statute but the content that should be given to those general law concepts.

It was in giving meaning to the general law concept of charity that the majority placed weight on the system of government for which the Constitution provided, saying:

"Any burden which the common law places upon communication respecting matters of government and politics must be reasonably appropriate and adapted to serve a legitimate end in a manner which is compatible with the maintenance of that system of government" (drawing on Coleman v Power, 2004)

Heydon: restricted viewHeydon and Kiefel did not challenge directly the reasoning of the majority.

Rather, both judges tended to take a restrictive view of the evidence going to the objects and activities of Aid/Watch, albeit a view influenced by the thrust of the old cases on the law of charity.

Certainly, no mention is made by the minority of the importance of preserving freedom of political speech as part of representative democracy and responsible government.

Aid/Watch is no longer deprived of tax deduction status in competing with other charities interested in improving the plight of poor people overseas.

Mainstream overseas charities such as UNICEF and Care Australia can utilise political lobbying as well as direct provision of assistance without fear of losing their tax exempt status.

The judgment opens opportunities to introduce the implied right of free speech into other cases involving questions of statutory interpretation and the development of the common law.

The Aid/Watch case indicates that the governmental arrangements for which the Constitution provides speak not only to questions of defamation law and the limits of indecent or insulting language.

The common law in Australia will favour the protection of free political speech in the Australian polity.

This contrasts with the views of the Prime Minister and the Attorney General who concluded that releasing and publishing embarrassing diplomatic cables was "illegal".

If the principle recognised by the High Court can influence the law defining charities, it can potentially affect many other areas, with significant social consequences.

The High Court under Chief Justice French continues to surprise.

Breathing new and unexpected life into the implied right of free political communication is not the first, and is unlikely to be the last, of its contributions.

Stephen Keim and Mary B. Ayad
Australian Lawyers for Human Rights

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