There was short-lived but understandable outrage when Western Australia tried to extinguish the legal rights of Mineralogy and Clive Palmer. We can expect the coming litigation it will provoke to raise constitutional law issues that will be studied by our great-grandchildren.
Much of that outrage focused on the evil of retrospective interference with bargains: the state was undoing a bargain into which it had freely entered almost two decades ago. Now, it is generally acknowledged that state governments can pass such retrospective adjustments to rights: it is how they have, for example, imposed liability on NSW builders for defects that arose before limitation periods expired; have done likewise with claims for sexual abuse that were time-barred; and adjusted other property rights over time. But legislation of this kind is rare, and generally confined to reviving rights that were, or at least were thought to, have existed before time had led to their discharge.
It is something different to allow governments to undo transactions that were wholly lawful when entered into. Yet, with the familiar invocation of ‘Security’, that is what the Commonwealth is now proposing in respect of dealings with foreigners: amendments to the Foreign Investment Review Board’s powers will allow it to impose retrospective conditions on sales entered into before the regime came into effect.
Now, there are reasons to be wary of its obvious target, the increasingly aggressive authoritarian regime in China, one which rather unconvincingly terms itself ‘communist’ while looking rather more like an irredentist central European power between the two wars. Authoritarianism – whether of the communist, fascist, nationalist or populist variety – is bad. Its nature is to interfere capriciously in the affairs of its subjects without regard to settled laws or recourse to fair tribunals for adjudication. So, of course, we need laws of uncertain meaning and retrospective operation to ‘combat’ it. Or, do we?