Opinion Number. 1543

Subject

MIGRANT SETTLER SCHEME MIGRANT SETTLER SCHEME: AGREEMENTS BETWEEN COMMONWEALTH, VICTORIA AND UNITED KINGDOM: LIABILITY OF COMMONWEALTH: LIABILITY TO VICTORIA AND UNITED KINGDOM: LIABILITY TO INDIVIDUAL SETTLERS: LIABILITY FOR REPRESENTATIONS OF AGENT OF VICTORIA: EFFECT OF ABSENCE OF STATUTORY AUTHORITY FOR MAKING OF AGREEMENTS

Key Legislation

IMMIGRATION LOAN ACT 1922 s 3

Date
Client
The Secretary, Prime Minister

On the 7th April, 1933, you referred to me for advice as to the responsibility, if any, of the Commonwealth Government:

  1. A copy of the Report of the Royal Commission;
  2. A copy of a letter dated 3rd April, 1933, addressed to the Prime Minister by Messrs. John Y. McComas & Co., Solicitors who acted for most of the settlers before the Royal Commission; a copy of a formal acknowledgement of this letter dated 7th April, 1933, is also enclosed; and
  3. Brief Summary of the Report dated 3rd April, 1933, prepared in your Department.

Although the several agreements are in furtherance of a scheme involving the British, Commonwealth and Victorian Governments, in no case have all three Governments been parties to an agreement. The Commonwealth is a party to all the agreements, some of the agreements being with the British Government and the remainder with the State Government. To a considerable extent the agreements between the Commonwealth and the State were for the purpose of securing the carrying out of the objects of the agreements made between the British Government and the Commonwealth Government.

Before dealing in detail with the individual agreements it should be pointed out that they have not been authorised or ratified by any Commonwealth or State legislation. In addition, the settlers who migrated under the agreements are not themselves parties to the agreement, and have no legal claim against either the Commonwealth or the State for any failure on the part of the Commonwealth or the State to carry out any obligation imposed on it by any agreement. (See Royal Commission Report, p. 12, citing 46 Law Quarterly Review p. 12).

So far, therefore, as claims arising under the agreements are concerned, whether those claims are by a settler or by a Government, they are legally unenforceable; and for the purposes of this agreement, therefore, references to obligations refer to moral obligations.

Dealing now with the individual agreements, they are eight in number.

Agreement of 21st September, 1922, between the Commonwealth and Victoria

This agreement is known as the 2000 farms agreement. Under it the Commonwealth undertook:

  1. To borrow on behalf of the State such sum, not exceeding three million pounds, as is necessary to settle migrants on 2000 farms;
  2. To arrange with the British Government for a loan of £300 per each migrant provided with a farm;
  3. To arrange for the selection and conveyance of migrants from time to time as may be required by the State;
  4. To pay one-third of the interest on up to two millions of the money borrowed in pursuance of (1).

The first and last of these undertakings are financial arrangements between the Governments and not pertinent to the findings of the Royal Commission.

The second undertaking is merely ‘to arrange’. The Commonwealth did in fact make this arrangement in the British Agreement of 12th April, 1923, (referred to hereunder), which was cancelled and replaced by agreement of 29th November, 1923, (also referred to hereunder) in which this provision was superseded by a clause whereby the Commonwealth undertook to arrange with the State that wages, within specified limits, should be paid to migrant settlers (the British government undertook, with further specified limits, to reimburse the State to the extent of half the wages so paid). This November agreement recites that ‘the Commonwealth Government concurs, and has ascertained that the State Government also concurs’ in so far as the British Agreement amends or supplements the 2000 farm agreement. The State’s concurrence is not set forth in any agreement to which the State is a party, however, but the report of the Royal Commissioner, page 4, contains the words ‘The State Government had, in fact, so concurred’.

The second undertaking was fulfilled by the establishment of the Migration and Settlement Office at Australia House.

The 2000 farms agreement was not affected by the Agreement of 11th September, 1925, between Commonwealth and State, but was cancelled by the Agreement of 26th March, 1926, and the Commonwealth in the last mentioned Agreement agreed to take steps to have the schemes under the 2000 farms agreement certified (i.e. by the British Secretary of State) as ‘agreed undertakings’ under the 34 million agreement. The schemes were so certified in 1929.

The 2000 farms agreement is, therefore, no longer in existence. Its cancellation released the Commonwealth from borrowing further moneys on behalf of the State. Hence the only Commonwealth obligations that can survive the cancellation are:

  1. to pay one-third of the interest on money that had already been borrowed; and
  2. to arrange a loan of £300 per migrant settled on a farm from the British Government.

As previously mentioned a different arrangement was made but the substituted arrangement has not been questioned and appears to have been satisfactory to all parties.

The State Agreement, entered into with the State on 11th September, 1925, in pursuance of the 34 million agreement, and the amending agreement of 5th November, 1928, which amends the State Agreement, are still in existence and are referred to hereunder.

Agreement of 12th April, 1923, between the British Government and the Commonwealth Government

Following the 2000 farms agreement with the State, the Commonwealth, on 12th April, 1923, entered into an agreement with the British Government. Seven months later, however, this agreement was ‘cancelled in all respects’ by the November agreement. In so far as the Commonwealth’s obligations under the former agreement were concerned, they were, with one exception, contained in the latter agreement, and expressed in substantially the same language. The exception was an undertaking by the Commonwealth to arrange with the State Government to provide each migrant with a farm of an average value of £900–£1500. No arrangement identical with this undertaking was, so far as the agreements disclosed, ever made with the State, but in my view the cancellation ‘in all respects’ seven months later released the Commonwealth from any obligation to make any such arrangement. It is therefore unnecessary to examine in detail the agreement of 12th April, 1923.

Agreement of 29th November, 1923, between the British Government and the Commonwealth Government

Under this agreement the Commonwealth undertook to arrange or to make arrangements concerning many matters. The majority of these matters were already contained in the 2000 farms agreement and, arrangements having therefore been made, those undertakings were fulfilled. In so far as matters not covered by the 2000 farms agreement are concerned, this agreement recites that the State Government concurs in the terms of the agreement in so far as it amends or supplements the obligations of the State Government under the 2000 farms agreement. The State is not a party to this agreement, and the recital of itself is not sufficient to prove that the State did concur. In the absence of further information as to the State’s concurrence, it is necessary to consider the additional Commonwealth obligations contained in the agreement of 29th November, 1923. These are as follows:

  1. By clause 4 the Commonwealth undertook to make arrangements with the State to ensure that a large proportion of men settled on farms should be men with families and that such men should be paid wages at current rates for a reasonable period up to two years.
  2. This arrangement, if made at all, was not incorporated in the agreement with the State but complaints of its non-fulfilment were definitely rejected by the Royal Commission, which found that if the obligation was not precisely fulfilled, a substantial equivalent was given. (Report, p.13).

  3. By clause 10 the Commonwealth undertook to make arrangements with the State to ensure, inter alia, ‘that migrants are treated fairly in all respects’.
  4. In the agreement made with the State on 11th September, 1925, this term was specifically mentioned, but it was not contained in the 2000 farms agreement. Nevertheless I consider that the several terms of the 2000 farms agreement whereby the Commonwealth bound the State in the interests of the migrants, constitute an arrangement to ensure fair treatment, even though, in the light of subsequent events, the fair treatment was not in every case ensured in fact.

    In any case, even if there were any liability of the Commonwealth under this clause it would not apply except in relation to migrants who were selected within a reasonable time after the agreement of 29th November, 1923, was made, and before the Commonwealth, by the agreement of 11th September, 1925, made the necessary arrangements.

  5. By clause 11 the Commonwealth undertook to make arrangements with the State Government to ensure that the debt charged to the migrant should not exceed the fair value of the land.
  6. No such arrangement was made in the 2000 farms agreement. The Royal Commission did not in the body of the report indicate that prices above the fair value of the land had been charged. In dealing with the individual complaints (See Schedule) the Royal Commission considered the price of A. B.’s farm ‘rather above the economic value’ and concerning E. R. said ‘price charged and complainant’s accrued deficits and lack of capital are too burdensome’. Even presuming that both migrants were under the 2000 farm scheme (there is no indication), the Commonwealth’s liability to ‘make arrangements’ is to the British Government and it is highly improbable that the British Government would be moved to take action because of two isolated cases, particularly in view of the very mild language used by the Commission.

    The remarks in the concluding paragraph in relation to clause 10 would apply also to this clause.

  7. By clause 13 the Commonwealth undertook to make arrangements with the State Government to ensure that, where a settler in respect of whom the British Government had made advances died or was otherwise dispossessed:
    1. every care would be taken to conserve the interest of the British Government;
    2. where possible to transfer the interest to another migrant; and
    3. where not possible, and the land was transferred to a non-migrant, to inform the Secretary of State by cable.

    No such arrangement was inserted in the agreement with the State but no failure to fulfil the requirements is indicated by the Royal Commission, and it does not appear that there is any liability of the Commonwealth under this clause.

  8. By clause 14 the Commonwealth undertook to make arrangement to ensure that leniency should be shown to a migrant in arrears with payments.

No arrangement was made but the Royal Commission does not indicate that in any case leniency was not shown.

Here again, there appears to be no liability of the Commonwealth.

As to all of the foregoing clauses it will be noted that the expression used is ‘the Commonwealth Government shall make arrangements with the State Government to ensure’ various things. If in pursuance of any of these clauses the Commonwealth made an arrangement with the State with the object of ensuring the carrying out of the purpose of the clause, the making of that arrangement would in my opinion amount to a complete discharge of the obligation of the Commonwealth. I do not think that the expression ‘shall make arrangements … to ensure’ can be interpreted as meaning ‘shall make arrangements which will ensure’. Rather do they mean ‘shall make arrangements with the object of ensuring’.

On the whole, I think that so far as the agreement of 29th November, 1923, is concerned, the only obligation of the Commonwealth to the British Government which need be considered at all is the obligation to make arrangements to ensure that the debt charged to a migrant should not exceed the fair value of the land (clause 11). And as to this obligation its application would be limited to migrants damnified by the non-making of such arrangements until 11th September, 1925.

Agreement of 8th April, 1925, between the British Government and the Commonwealth Government (34 million agreement)

The obligations of the Commonwealth under the 34 Million Agreement include the following obligations and undertakings:

  1. to endeavour to make arrangements with State Governments for suitable areas of land to be made available for development of settlement, and for the carrying out of public works tending to promote development;
  2. to submit to the British Government any State undertaking with which Commonwealth Government is satisfied;
  3. to raise loans for the purposes of agreed undertakings;
  4. to pay over the British contributions to the States;
  5. to make arrangements to ensure the reorganisation of methods at present employed in reception, absorption, training, settlement etc. of assisted migrants;
  6. to arrange that assisted migrants shall be treated fairly in all respects;
  7. to arrange that assisted migrants shall have equal treatment with Australians in the acquisition of farms, etc.;
  8. that assisted migrants shall be given advice and supervision in management of their farms;
  9. that in any case assisted migrants shall be found suitable employment in Australia at the same rate of wages as Australians of similar experience;
  10. to furnish full information to the Secretary of State.

On 8th April, 1925, the Commonwealth entered into what is known as the 34 million agreement with the Imperial Government. By this agreement the Commonwealth undertook, inter alia, to enter into corresponding agreements with such of the States as desired to join the scheme. In the case of Victoria this was done by the agreement of 11th September, 1925, conveniently known as the State Agreement. Both the 34 million and the State Agreement contemplated the possibility of previous schemes being brought within the terms of those agreements. By an agreement of 26th March, 1926, which cancelled the 2000 farm agreement, the 2000 farm scheme was accepted by the Commonwealth as an approved undertaking for the purpose of the 34 million agreement. The 34 million agreement was amended to this end by an amending agreement of 27th March, 1928, which contained also other amendments. These further amendments were inserted in the State Agreement by the agreement of 5th November, 1928.

By the State Agreement of 11th September, 1925, hereinafter referred to, the State undertook to carry out all these undertakings of the Commonwealth in so far as they were obligations to migrants. In my view the making of this agreement has the effect of discharging the liability of the Commonwealth under the agreement, even though the State might not have carried out in all respects its obligations under the agreement. The only Commonwealth obligation as to which there may be any doubt is the undertaking by the Commonwealth to arrange that assisted migrants shall be treated fairly in all respects; but even as to this, I think the State Agreement amounts to a discharge to the Commonwealth.

Agreement of 11th September, 1925, between the Commonwealth and Victoria

Most of the obligations in this Agreement are obligations by the State to migrants. There is no suggestion that the Commonwealth has not fulfilled its obligations under this agreement.

Agreement of 26th March, 1926, between the Commonwealth and Victoria

This Agreement cancels the 2000 farms agreement, and applies the State Agreement of 11th September, 1925, to the scheme of land settlement arranged under the 2000 farms Agreement. It is agreed that the provisions of the State Agreement shall apply to that scheme with effect retrospectively as from 21st September, 1922.

It is not suggested that any liability arises under this Agreement.

Agreement of 27th March, 1928, between the British Government and the Commonwealth Government

This Agreement deals in the main with the financial arrangements between the British and Commonwealth Governments, and is immaterial to the questions which have arisen as to the liability of the Commonwealth or the State in relation to migrants.

Agreement of 5th November, 1928, between the Commonwealth and Victoria

This Agreement amends the State Agreement of 11th September, 1925, on the lines of the British Agreement of 27th March, 1928, and is not material to the questions which have been raised.

Generally as to the agreements

Dealing generally with the matter of the agreements, I am of opinion:

  1. That so far as the migrants are concerned the Commonwealth is under no legal liability to the migrants, and that it has no moral obligation to them except (possibly) in so far as migrants may have been damnified by the failure of the Commonwealth to make (after the agreement with Great Britain on 29th November, 1923, and prior to the agreement with the State on 11th September, 1925) arrangements to ensure that they should be charged fair prices for their land.
  2. That there is a clear line of demarcation between the obligations of the Commonwealth and those of the State under the agreements, and that in so far as the complaints of settlers relate to the non-fulfilment of the agreements between the Commonwealth and the State relating to settlement on the land, they are primarily obligations of the State, and that the obligation of the Commonwealth could only arise (if at all) upon the failure of the State to carry out its obligations.
  3. That as regards the British Government there is no legal liability of the Commonwealth, but there is a moral obligation arising out of any failure on the part of the Commonwealth to give effect to any agreement made with the British Government. The only case in which any apparently justifiable complaint of such failure arises is that mentioned in the last of paragraph I (supra.)

With reference to the paragraph I above, I should, however, point out that by the agreement of 26th March 1926, between the Commonwealth and the State it was agreed that on the certification under the State Agreement of 11th September, 1925, of the schemes of land settlement arranged under the agreement of 21 September, 1922, those schemes should become undertakings under that State Agreement, and the provisions of that Agreement should apply to those schemes retrospectively to 21st September, 1922. The acquiescence of the State in this agreement of 26th March, 1926, may perhaps be relied on by the Commonwealth to some extent as a compliance by it with the obligation imposed on it by the Agreement with the British Government dated 29th November, 1923.

Question of liability apart from agreements

For the purpose of securing migrants from England, various representations were made.

Exception has been taken to certain of these representations, particularly those contained in a pamphlet entitled ‘Australia–Farms for British Settlers in Victoria’. It purported on its cover to be published by the Migration and Settlement Office, Australian Government, Australia House.

I have not at present enough information to say whether the Commonwealth was in any way responsible for the issue of this pamphlet, or whether any statement contained therein is of such a false or extravagant nature as to give rise to a right of action on the part of any person who suffered damage as a result of it.

Consideration has been given to the representations made by Mr. E.F., the son of the Agent-General for Victoria. It would appear that Mr. G.H. was appointed by the Agent-General to perform duties in relation to the obtaining of suitable settlers. It would appear that he was paid by the Commonwealth Government.

Notwithstanding the arrangements for the payment of his salary I am of opinion that the Commonwealth is not responsible for the statements made by Mr. I.J..

In 1924 Mr. K.L. is stated to have arrived and taken up work by arrangement between the Commonwealth and the State Governments.

It is stated in the Commission that Mr. J. thought he had been specially sent to London by the Victorian Government to select applicants desirous of settling on the land in Victoria and so stated in a folder–‘Land Settlement in Victoria’ compiled and issued by him in London to intending migrants. The Commonwealth was entitled to use his services in other directions, but primarily his function was to obtain migrants for the State Government scheme.

It would appear that Mr. J.’s activities on the part of the Commonwealth were restricted to duties altogether apart from canvassing for intending migrants.

There is nothing to suggest that the Commonwealth is responsible for any statement made by Mr. J. in carrying out his duty to the Victorian Government in selecting applicants.

On the whole, therefore, I am of opinion, on the information before me, that the Commonwealth is not legally liable, at the suit of either the British Government or a migrant, on an action of contract in respect of these publications. In view, however, of the definite motive of some of the statements made, it would seem that the State would be liable at the suit of a migrant who had already been induced to migrate, unless the State can set up a waiver on the part of the migrant.

Supplementary. I have referred earlier in this memorandum to the fact that there is no Commonwealth or State Statutory authority for the making of the agreements.

It has been suggested that statutory authority can be found in section 3 of the Immigration Loan Act 1922 for the subsidiary agreements made between the Commonwealth and the States. That section is as follows:

Moneys borrowed under this Act shall be issued and applied only for the expenses of borrowing and for making Loans to the States for the purposes of Immigration and works in connection therewith in accordance with agreements made or to be made between the Commonwealth and the States.

The whole purpose of the Immigration Loan Act is to authorise the borrowing of moneys and the making of advances to States out of the moneys so borrowed. The fact that there is an incidental reference in section 3 to agreements made or to be made between the Commonwealth and the States does not in my opinion amount to statutory authority for the making of those agreements. A fortioro the section cannot be taken as authority for an agreement between the Secretary of State of the United Kingdom and the Commonwealth.

The legal position appears, therefore, to be, as previously stated, that no liability attaches to the Commonwealth under the agreements in view of the absence of statutory authority for their making.

[Vol. 26, p. 326]