Justifications for interferences

7.136   The most general justification for laws that interfere with vested property interests is that the interference is necessary and in the public interest.

7.137   Protocol 1, Article 1 of the European Convention provides:

Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.

7.138   Bills of rights and international law commonly provide exceptions to the right not to be deprived of property, usually provided the exception is reasonable, in accordance with the law, and/or subject to just compensation.^[180] For example, the Fifth Amendment to the United States Constitution provides:

No person shall be … deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation.^[181]

7.139   The compensation on just terms provision in the Australian Constitution is considered above.

7.140   There are many laws and regulations that interfere with property rights. Laws limit land use to protect the environment, to balance competing private interests or for the public interest.^[182] Other laws might regulate the content and advertising of products, such as food, drinks, drugs and other substances, to protect the health and safety of Australians. Many such laws will be ‘justified’.

7.141   In the Issues Paper, the ALRC invited submissions identifying those Commonwealth laws that interfere with property rights and that are not justified, explaining why these laws are not justified. The ALRC also asked what general principles or criteria should be applied to help determine whether a law that interferes with vested property rights is justified.^[183]

7.142   The Law Council submitted that additional criteria for justifying encroachments on property rights might be whether:

(a)        the public interest in acquisition, abrogation or erosion of the property right outweighs the public interest in preserving the property right; and

(b)       is the acquisition, abrogation or erosion of the property right lawful.^[184]

7.143   The Arts Law Centre of Australia recommended the application of the balancing process described by French CJ in JT International SA v Commonwealth. His rejection of the claim by the plaintiff tobacco companies of ‘acquisition’, such as to attract compensation under s 51(xxxi) of the Constitution, reflected

a serious judgment that the public purposes to be advanced and the public benefits to be derived from the regulatory scheme outweigh those public purposes and public benefits which underpin the statutory intellectual property rights and the common law rights enjoyed by the plaintiffs.^[185]

7.144   The Arts Law Centre submitted that the criteria should also include an assessment of whether the law that ‘interferes’ with vested property rights is implemented and operated in practice in the most optimal way available.

It is possible that what are otherwise justified public purposes and public benefits to be gained from an ‘interference’ with vested property rights are not implemented or operated in the optimum manner possible in the circumstances.^[186]