Chapter 1 Revision Questions

Chapter 1: The Australian Legal System
Revision questions in textbook – Questions 1-5:
1) In 2013 a scandal erupted involving a football club and its players, whereby
the club and the coach were accused of using supplements banned by the
sporting authorities. The regulatory authorities and the press put a lot of
pressure on the coach to explain what had happened. The coach made various
public statements to the effect 'that he had been denied natural justice'. What
was the coach referring to? How does this relate to the fairness of the
Australian legal system?
When Essendon coach James Hird assembled his squad under his watch for his third season
in early February 2013, club president David Evans announced that the organisation had
"self-reported" to ASADA, leading the governing agency and the AFL to launch an inquiry
into the supplementation policy of the organisation. Subsequent reports from the team and
retired players revealed that the company conducted an ambitious and innovative
supplementation system under the guidance of notorious sports scientist Stephen Dank. As a
culmination of a 12-month inquiry into substances in sport, the publication of the Australian
Crime Commission study occurred with particular focus being paid to the AFL and NRL. The
study outlined the vulnerability of all codes to organised criminal interference, an alarming
discovery that would lead former ASADA head Richard Ings to mark his dismissal as "the
worst day in Australian sport."
Amid reports that all players and staff obtained abdominal shots daily, Essendon asked Ziggy
Switkowski to conduct a comprehensive review into organisational governance at the
organisation. Meanwhile, lurid reports of pig's brain extracts or bark extract procedures
appeared, furthering both the team and the league's strategic communications issue. League
head Andrew Demetriou proposed as early as March that Hird would consider stepping away
from his role before the issue has been settled. The reports of Switkowski revealed "a
shocking impression of a pharmacologically testing environment," portraying athletes as
human test animals, while also exposing the reality that the fitness and conditioning director
of Dank and Essendon, Dean' The Gun' Robinson, was not even subject to the most rigorous
background checks. Ian Robson, CEO of the group, was gone by late May, saying he would
have had a clearer idea of the scheme. In late June Essendon leader, Jobe Watson revealed
how he had taken the controlled drug AOD-9604 while insisting that he thought the team had
"done nothing illegal" Dank took High Court litigation in the aftermath of the allegations if
ASADA tries to pressure him to submit a disclosure on his role with the supplements scheme.
By late July it was reported that Hird had said in talks with ASADA that team president
David Evans had obtained a tip-off on the Australia Crime Report investigation from AFL
CEO Andrew Demetriou. Evans quit under the weight of severe pressures within 24 hours of
providing public solidarity to Hird. Evans was not Essendon's only exit, with the suspended
Robinson turning in his resignation alongside Liz Lukin, chief publicity advisor for the
Bombers.
Robinson unleashed a vicious attack on Hird's role in a lurid, not yet tell-all press conference
with Channel Seven late July. Within days, Essendon obtained an investigative briefing on
the fiasco from ASADA, which provided the team with a strong hint that they and people
inside the group would most definitely be threatened with dishonour the game. Newly-
installed president Paul Little made adamant that the party should be entirely committed to
battling any allegations. The AFL formally charged Essendon on 13 August with discrediting
Business and Corporations Law, 3rd edition, Revisions questions and solutions, Chapter 1
© 2017 Reed International Books Australia Pty Limited trading as LexisNexis. Learning materials
created and updated by David Parker.
the team, along with allegations against coach Hird, his deputy Mark Thompson, professional
club doctor Bruce Reid, and player personnel boss Danny Corcoran.
ASADA issued an investigative report to the AFL and Essendon Football Club on 2 August
2013, almost seven months after the inquiry. The preliminary study provided no specific
conclusions on the validity of the supplementation plan but outlined a wide variety of
program-related shortcomings in policy and duty-of-care. On the evening of 13 August 2013,
on the grounds of the preliminary findings, AFL staff attorney Andrew Dillon accused
Essendon with "behaviour which is inconvenient or likely to damage the Australian Football
League's values or prestige or to undermine the football game, according to AFL Rule 1.6."
Essendon's allegations included:
 Being "engaged in activities that subjected participants to serious health and safety
threats, as well as the possibility of utilising drugs banned by the AFL Anti-Doping Code
and the International Code on Anti-Doping."
 Allowing 'a system of regular, uninformed and unrestricted usage of drug injection' at the
club
 "Failed to warn participants of the substances of the system in a timely way and gain their
written consent to the application of the substances."
 Has an inadequate record-keeping system which rendered it difficult to decide with
confidence whether players were administered prohibited supplements or not
 Bypassing human resources standards directly related to the Robinson and Dank jobs
Coach referred to the preliminary report concluded that Essendon planned the system to be an
ambitious initiative of unparalleled size to bring a strategic advantage to the team, but did not
perform sufficient analysis or create consistent reporting lines for the people executing the
software. The AFL Tribunal subsequently reported that there was a 'deplorable absence of
information in the system related to the program's execution.
The AFL has lodged charges against Football Team Essendon. In August, the team and the
league debated and arranged sanctions over two days and on 27 August 2013, five days
before the deadline round of the 2013 home-and-away season, decided and enforced the
following sanctions:
 Essendon was sentenced $2 million (three years in jail). It was the highest penalty in
Australian sports history levied on a team.
 Essendon forfeits his spot in the 2013 AFL finals series and is expected to finish in
the 9th position. The team was on target in the seventh position to qualify for the
final.
 Essendon was prohibited to field draft selections in two rounds. His first and second
stage draft picks were banned in 2013; in 2014, Essendon was barred from practising
the first, and second-round draft picks he should have won depending on his finishing
position, although the last draft pick was placed in the first round.
 Senior coach James Hird has been banned for twelve months from participating with
the football team, effective 25 August 2013.
 Sports management boss Danny Corcoran was banned for four months from getting
active with any football team, with an additional two-month deferred term, effective 1
October 2013.
 With the addition to Mark Thompson, a penalty $30,000 has been levied. In the end,
Thompson charged the penalty $5,000, with Essendon paying the remainder.
When part of the deal, Hird withdrew litigation he had filed about the Supreme Court claims.
Given the ties between the AFL teams from Essendon and VFL, the VFL team was still
eligible to compete in the VFL finals series.
Club doctor Bruce Reid was also arrested, and a sanction was released. However, he declared
his plan to contest the charges against him during the Victoria Supreme Court. The AFL
dismissed all allegations against Reid on 18 September 2013, thereby enabling him to resume
his position as the club's chief medical officer. The official statement of the league concluded:
"Reid fully supports the AFL in its primary mission of providing for players' safety and
wellbeing. He expresses his frustration regarding the troubling situations that contributed to
the Essendon Football Club's saga with supplements.
Hird remains on the Essendon payroll, earning his maximum paycheck despite the
suspension. Initially, the AFL insisted that the payments cease after they were publicly
disclosed in December 2013, but acquiesced soon after realising that its legal stance was
weak. Mark Thompson moved up in Hird's absence to work throughout the 2014 season as
Essendon's senior assistant. Several allegations were brought against the teams at the moment
of the implementation of suspensions for deficiencies of administration, whether or not
controlled drugs was used was untested, and the ASADA and AFL inquiries remained
ongoing.
2) Explain the distinction between exclusive powers and residual powers that
are outlined in the Australian constitution. Give an example of each.
Exclusive powers: A variety of which are exclusive to the limited collection of law-making
powers imposed on the Commonwealth as mentioned above. Exclusive rights are those on
which only the Crown may legislate and the States can not. Those involve political problems
such as citizenship, security, and currency. Such law-making rights are part of federal forces,
but they are regarded individually and named as states are exempt from legislating on them.
Exclusive power is those forces which only the Federal Parliament may exercise. Such rights
are laid out in the constitution and shall include:
 Section 90 The authorisation to levy tariffs and excise taxes

 Section 114 forbids the formation of naval or armed powers by States
 Section 115 forbids a Member State from minting its coins.
Of starters, only Congress may wage war and tax products, and only the Senate may process
known, as the constitution bans states from using such powers (although a state can
participate in the war if it has been invaded).
Residual powers: Such forces to render legislation are not contained in the Australian
constitution. Colonies at the time of the union managed to maintain some of their rulemaking
forces and not give away their constitutional rights to the Commonwealth entirely. As such,
they maintained a collection of law-making powers that each State could legislate based on
their states' need. Other law-making fields cover employment, criminal legislation and
wellness. They have the VCE in Victoria, for starters, as opposed to HSC.
Each colony before Confederation had its collection of forces. Many of these rights were
transferred to the Commonwealth at the union. The existing rights stayed with the states; they
are considered residual rights, and based on these forces, only the states may create rules. You
will consider instances of residual forces in the fields of:
 Law & Order

 Commerce and production
 Main production
 Pédagogy
 Lodging
 Transportation
 Evolution
 public health and social welfare issues.
Any area not governed by the constitution is assumed to be under the authority of States to
create laws and is considered a residual force. Such are the forces at the union that have not
been passed to the Commonwealth. City development and common law provide the
remaining rights.
3) Under the Victorian Road Safety Act 1986 s 18, it states that it is an offence
to drive a motor vehicle on a highway without holding a driving licence. It
further states under s 3 that a 'driver' is defined to be a driver who '… is
present in or near the vehicle'. The police find an unlicensed person sitting in a
parked car, in the driver's seat, with the engine off. Referring to the different
rules of statutory interpretation, explain the possible liability (and defences)
which may apply to this unlicensed driver under the statute.
Driving without a proper license: When your registration has expired, or you are barred from
keeping a certificate, you can risk a fine of up to $9,500 or six months in jail. The same
punishment occurs for having a driver who is not qualified to operate the vehicle. If you have
already kept a Victorian or interstate license and have not been revoked for road-related
purposes, instead the punishments are less harsh, with fines rising to $1470 and rising to a
month in custody. Driving on a revoked or expired registration: You may be charged up to
$38,000 or two years in jail because you were unlicensed and got an alcohol-interlock
restriction issued because you applied for a licence. The same is valid with revoked licenses.
Fully licensed drivers above the age of 26 aren't allowed to hold their licenses. Learner
drivers do, so it's a $155 penalty to refuse to deliver it on time.
In Victoria, operating unlicensed is a crime. When you drive without a proper permit, you can
be charged, disqualified to request for a license for some time, and forced to complete a jail
sentence. Many forms of decisions may also be issued by the judge, including car
immobilisations or group service. The following sections include unlicensed driving:
 Drivers either never received a certificate or have lost their permit

 Drivers have revoked or cancelled a current license
 Drivers prohibited from possessing a license
 Drivers that contravene every provision of their license
You may be charged up to $4,400 and spend up to 4 months in jail because you were
unlicensed and got a drug interlock restriction put on you because you had qualified for a
certificate. Unless you were exempted from a driver's license or have your license revoked,
the same penalty may apply. Whether it's not the first time you've been found disqualified
riding or if your license has been revoked, you could risk a fine of up to about $35,000 and
up to 2 years in jail.
You will be eligible to lift a defence against an unlicensed driving claim in certain situations.
The most frequent protection is that at the moment of the suspected crime, you have a
genuine and fair conviction that you possess a legal certificate. Typically you have to
persuade the judge that your claim that you were qualified was a rational conviction for this
defence to operate.
4) Does every dispute need to go to court? Explain the means by which

disputes may be resolved without ending up in a court of law.
Managers fear few issues more than lawsuits. Just minor incidents have the potential to hurt
families, tarnish reputations and steal large amounts of capital, energy and creativity. Most
administrators know the cases are rising slowly. Good administrators often realise they are
mostly avoidable. There are so several approaches to litigation that will nip cases in the bud,
end unresolved conflicts and even create win-win outcomes to old and contentious problems
that can likely only hurt both sides. Three-way to resolve dispute without going to court are:
 Settlement Negotiation: Negotiation is essentially one side's method of approaching

the other group to attempt and hammer out an agreement (or "settlement") of a
conflict in which all sides may negotiate. The parties are entitled to seek to settle their
conflict by arbitration until a lawsuit is brought, or at some point during the duration
of a trial. Ask that it will benefit from speaking to another person or write a letter to
let everyone know what the issue is and what you believe you are required to do
before you lodge a lawsuit. They may also let them know if the conflict is not settled,
that you are contemplating appealing. When you are seeking a mediation, write a
comprehensive arbitration document specifying the terms and conditions. Both parties
will ratify the document. When one party refuses to perform, you can sue to compel
the performance of the group, or owes for some compensation. There are also options
to arrange the deal, such that if one side refuses to comply, it is a legal decision
 Mediation: A neutral person (called the "mediator") supports and directs the
negotiation mechanism of mediation to enable the sides to achieve a satisfactory
agreement, which does not allow a conflict settlement. The mediator is also a
qualified expert, skilled in different methods of mediation. However, the mediator
may also be a prosecutor, a former judge, or a specialist in a particular area.
Contracting parties may decide to mediate a disagreement as it is quicker and less
expensive than arguing in court. They may even consent to mediation as they prefer
the concept of how to settle the conflict, if at all (as opposed to letting an arbitrator or
tribunal making a judgment for them).
 Arbitration: A third person (called the "arbitrator") serves as a private judge in

arbitration, who takes a ruling on the conflict between the parties. The arbitrator
might be an advocate, a specialist in a particular area (such as architecture or
engineering), or perhaps even a judge who has retired. The parties usually compensate
for the services provided to the arbitrator. Often the parties want to arbitrate a dispute,
mainly because it would be quicker, more comfortable, and less costly than heading to
arbitration. Often the parties are obliged to use arbitration because they have
concluded a document which includes an "arbitration provision" allowing arbitration
in any conflict involving the document.
5) The manufacturer of a hearing aid, which was implanted into the wearer's
ear, was sued because of injuries received by the consumers who purchased
the product. How would tort law apply in this situation?
The U.S. at July 2018 Department of Justice reported that 3 M Corp. had decided to spend
$9.1 million to resolve a Fraudulent Allegations Fraud case alleging 3 M of intentionally
supplying faulty earplugs to the U.S. military. The case, brought in federal court in South
Carolina, was prompted by claims that 3 M and its subsidiary, Aearo Technologies Inc.,
marketed their Combat Arms Earplugs, version 2 to the Defense Logistics Agency claiming
that they were too small to be adequately placed into the ears of a customer. The faulty
earplugs are dual-ended and can either be used as standard earplugs or rotated to a "safe"
place to attenuate the effects of the blast while also allowing in louder noises. After being
placed into the ears, the devices will slowly relax and struggle to mitigate background sounds
adequately. The U.S. Department of Justice claimed that staff of Aearo Technology,
particularly those who left 3 M when Aearo purchased it in 2008, learned of the product
problems as early as 2000 as it conducted a production of the earplugs. So well so
deliberately marketing such faulty earplugs to men and women in uniform, 3M / Aero has
stopped many firms from offering more competitive alternative goods. In 2012, 3 M initiated
a patent theft lawsuit directed at Moldex-Metric's BattlePlugs, now used by the military. The
case concluded in a Moldex plea settlement. 3M's CAEv2 earplugs became mandatory
equipment for some military services between 2003 and 2015 and became the only viable
choice for earplugs attenuation by military forces between 2003 and 2012. An MDL was
created at federal courts in Florida in April 2019 for the 3M Battle Weapons Earplug cases.
Our law firm serves as the MDL 's co-liaison lawyer. More than 6,800 cases had been filed in
the MDL as of March 2020.
Problem question in textbook:
Ms Anstis claimed a deduction for education expenses against her youth

allowance income, which was denied by the ATO. Ms Anstis (with the
assistance of her father, a lawyer) appealed that the ATO had not applied tax
legislation appropriately. The ATO having lost one case then appealed to the
High Court.
The High Court on 11 November 2010 dismissed the Australian Tax

Commissioner's appeal against the decision of the Full Federal Court in of T v
Anstis. The Full Federal Court had previously decided that Ms Anstis, who
received a youth allowance as a university student, was entitled to a tax
deduction for her education expenses incurred in order to derive her income.
The full bench of the High Court held that the expenses were incurred in the
gaining of the youth allowance and were not of a private or domestic nature,
under the general deduction provisions. In a media release following the High
Court's decision, the ATO Commissioner said the ATO was considering the
decision and would advise taxpayers on potential claims.
Discuss the following:

 What is the role of the ATO as an executive body? 1.7
The ATO is responsible for implementing the Australian federal tax scheme, the
superannuation statute and other relevant matters. . As the primary revenue collecting agency
of the Australian government, the ATO raises the tax on wages, goods and services (GST),
among other federal taxes. The task of the ATO is to efficiently administer and influence the
tax and superannuation programs that sustain and finance Australian services. In this position,
we prescribe tax law and essential aspects of the Superannuation Act and provide
Government advice to promote the implementation of tax legislation
 Does it make the law? 1.2
Unless your argument is overruled on the points you 're citing it on; your idea is poor law.
Notice also that a higher court may overturn a lower court decision by creating a declaration
of law that opposes your proposition – effectively overruling your argument without naming
it.
 How does this case reflect the interaction of the different bodies under the
separation of powers doctrine? 1.7
Power exchange yet another test. The division of powers structure splits the State 's duties
into three branches: democratic, administrative and judiciary. Such duties are delegated to
different organisations in such a manner that each one of them may check the others.
Consequently, separation of powers applies to the division of political duties into different
divisions that prevent each branch from the operation of the core functions of another. The
goal is to avoid power accumulation and to allow for checks and balances. The division of
powers is often expressed in the idea that no the same entity may perform those roles.
Therefore, the Federal Leader can not be a member of the State Council at the same time,
unless a judge named minister unless chosen to be a member of the State Council must be
indefinitely removed from his / her judicial responsibilities.
 What is the significance of the High Court decision in terms of tax law as it
is applied within Australia? 1.39
1.121.
The High Court ruled the section 109, which guarantees that there will be restricted scope in
the taxation area where Commonwealth and State laws are in dispute Commonwealth law. Of
this effect, taxation from the same tax base will be levied on the Commonwealth and the
States. The High Court 's duties are to define and enforce Australia's law; to resolve disputes
of unique statutory importance, including claims to the substantive legitimacy of legislation,
and to consider applications from Commonwealth, Provincial, and Territory courts by special
leave. This has both initial and appeals authority, the right of a legal challenge of legislation
enacted by the Australian Parliament and the state and local parliaments, and the capacity to
define Australia's Confederation and thus form Australia's nature of federalism.

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Chapter 1 Revision Questions

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Chapter 1: The Australian Legal System

Revision questions in textbook – Questions 1-5:

 Section 90 The authorisation to levy tariffs and excise taxes

 Law & Order

 Drivers either never received a certificate or have lost their permit

4) Does every dispute need to go to court? Explain the means by which

 Settlement Negotiation: Negotiation is essentially one side's method of approaching

 Arbitration: A third person (called the "arbitrator") serves as a private judge in

Problem question in textbook:

Ms Anstis claimed a deduction for education expenses against her youth

The High Court on 11 November 2010 dismissed the Australian Tax

Discuss the following:

 Does it make the law? 1.2

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