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Magistrates Court granted power to hear certain retail tenancy disputes and other matters

On 10 August 2021, the Victorian Civil and Administrative Tribunal and Other Acts Amendment (Federal Jurisdiction and Other Matters) Act 2021 (the Act) received Royal Assent. However, only Part 4 of the Act (dealing with an amendment to the Public Prosecutions Act 1994) came into force on that day, with each remaining part of the Act to come into operation on a date to be proclaimed by the Governor of Victoria.

Part 2, dealing with federal subject matter amendments that are the subject of this article, was proclaimed on 23 November 2021 and will come into operation from 29 November 2021.

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Federal Subject Matter

The purpose of Part 2 is to deal with a gap in the ability of VCAT to hear matters relating to ‘Federal subject matter.’

The relevant issue is that state tribunals (such as VCAT) are not ‘courts of the state’ for the purposes of s77(iii) of the Australian Constitution. As a result, they do not have the power to hear matters arising under section 75 of the Constitution, for example ‘between States, or between residents of different States, or between a State and a resident of another State’ (section 75(iv) of the Constitution).

The issue in question arose after a 2018 High Court decision affirmed that a NSW state tribunal did not have jurisdiction over residents of other states (see Burns v Corbett [2018] HCA 15). A discussion of the implications of this ruling is available on Sam Hopper’s blog here. The principles laid out in Burns were subsequently found by the Supreme Court of Victoria to also apply to VCAT in Meringnage v Interstate Enterprises Pty Ltd [2020] VSCA 30.

This becomes problematic when a matter arises in an area of law over which VCAT is intended to have jurisdiction but is unable to exercise its powers as a Tribunal due to section 75(iv). For instance, this presents itself where either a landlord or tenant under a retail lease or residential tenancy is not a resident of Victoria. In such instances, VCAT will not have the power to hear the dispute (despite VCAT typically having jurisdiction over retail leasing and residential tenancy matters).

The Amending Act

Part 2 of the Act resolves this issue by conferring upon the Magistrates Court of Victoria the power to hear matters that would ordinarily be heard by VCAT, but that are unable to be due to VCAT lacking ‘jurisdiction to exercise judicial power to resolve controversies involving federal subject matter.’

The definition of ‘federal subject matter’ in the Act encompasses matters covered by sections 75 and 76 of the Australian Constitution, save for section 75(v). This will allow applications to be made in the Magistrates Court that would ordinarily be heard in VCAT but cannot because they are matters:

  • Between states, residents of different states or a state and resident of another state

  • In which the Commonwealth is suing or being sued

  • Involving the Constitution or its interpretation

  • Arising under any laws made by the Commonwealth Parliament

The Magistrates Court will accordingly be entitled to hear and determine any such application if:

  • the application raises, or there is some doubt as to whether it raises, a controversy involving federal subject matter; and

  • resolution of that controversy would involve, or there is some doubt as to whether it would involve, an exercise of judicial power; and

  • the Tribunal would have had original jurisdiction enabling it to determine an application involving the same subject matter if the application did not raise a controversy involving federal subject matter the resolution of which would involve an exercise of judicial power.

That the Act applies where ‘there is some doubt’ about whether an application involves federal subject matter, is designed to remove ambiguity and ensure any matters potentially unable to be heard by VCAT are addressed by an appropriate court (and so avoid later dispute as to whether VCAT had appropriate jurisdiction).

Importantly, the Act also removes the ‘jurisdictional limit’ of $100,000 that would typically cap the amount able to be claimed in a proceeding in the Magistrates Court, so long as the proceeding arises under:

  • Part IV of the Accident Compensation Act 1985;

  • Part 3A of the Victorian Civil and Administrative Tribunal Act 1998 (see below);

  • the Workplace Injury Rehabilitation and Compensation Act 2013.

For clarity, Part 3A of the Victorian Civil and Administrative Tribunal Act 1998 is the new part inserted by the Act that grants the Magistrates Court jurisdiction to hear federal subject matters. This brings the Magistrates Court’s powers in line with the remedies typically available to VCAT in certain matters (particularly where it holds exclusive jurisdiction).

It is worth noting that some disputes where a party is registered in another state may still be able to be heard in VCAT. Although VCAT is unable to hear disputes that involves a ‘resident of another state,’ ‘resident’ has been defined narrowly to only mean a natural person (and not a corporation) – a dispute that involves a corporation registered in a state other than Victoria will therefore still be able to proceed in VCAT.

Jack Kelly



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