Question 1

The Australian legal system has been inherited through its former status as a colony of the British empire.
However, throughout the development of Australia and its independent growth as a successful colony, the
question of independence was raised. With such came the severance of the British legal influence over the
Australian legal system. The first example of such was the Colonial Laws Validity Act 1865 which acted as the
starting domino which would continue momentum onto the Statute of Westminster 1931 and eventually leading
to the Australia Act 1986 which demonstrated complete severance from the British legal system. Each act plays
a crucial role in allowing the nation of Australia to develop its own legal system. Thus, the significance of the
Colonial Laws Validity Act and the Statute of Westminster cannot be assessed without a further investigation of
the resultant Australia Act.

In 1865, the Colonial Laws Validity Act was passed through the British parliament. The resulting effect was the
transfer of legislative power to the Australian parliament, yet, reserving the option for the colonies to differ
legislative responsibility to the British parliament when desired. Further, the act also preserved the notion of
‘paramount force’ which is the legal doctrine that necessary laws passed by the British courts and parliament is
immediately enforceable and functioning within the Australian and other colonies legal systems. Laws inflicted
through the use of paramount force were not able to be amended, repealed or dismissed by any legal body
within Australia. The Colonial Laws Validity Act 1865 represents a starting point for Australian legal
independence; however, it outlined a lingering connection to the British system and reaffirmed the idea that
Australia was a subsidiary to Britain and must abide by its law regardless of its wishes. Further, it gave the
Australian government, parliament and judiciary the ability to direct the legal system in the way they desired, as
long as it was not in conflict with the British desires.

Further developments in the powers and responsibilities of the Australian legal system were implemented in the
Statute of Westminster 1931 which only came into effect in Australia in 1942 with the Statute of Westminster
Adoption Act. The Statute of Westminster 1931 echoed the ideas outlined within the 1926 Balfour Declaration
Such stated that,
[the colonies were] autonomous communities within the British Empire, equal in status, in no way subordinate to
another… united by a common allegiance to the Crown, and freely associated as members of the British
Commonwealth of Nations.
As it gave increasing statutory power to the colonies. Under section 2 it rendered the Colonial Laws Validity Act
inapplicable for future legislation and removed the need for legislation to be in parallel with the wishes of the
British Empire. However, section 4 allowed the dominions to still ask for legislative help from Britain if needed.
The Statute of Westminster was once again a step for the Australian legal system towards total independence,
yet, Britain still possessed the capability to impose legislation upon the states directly and as evident through the
Australian navy’s mandatory compliance with British Naval Law independence was not yet achieved. Further,
the paramount force legislation was still effective and immune to the Australian legal institutions. It effectively
outlined the slow developing route that both nations were taking to achieve independence, which resulted in an
effective and total removal of British power over Australia. However, notably the Statute of Westminster only
effected the federal legal system, giving the same level of control over the states and their law as before to
Britain. Although a significant step for legal independence from Britain the Statute of Westminster 1931 still
possessed small strings and exceptions allowing Britain to legislate and control the Australian legal system.

The primary legislation outlining the severance from Britain and Australia’s legal systems is the Australia Act
1986 which effectively gave legal independence to Australia. The States now were able to legislate as they
pleased without having to conform to the wishes and demand for consent of the British parliament. The
Australia Act also allowed for the High Court of Australia to replace the Privy Council as the supreme appeals
courts for Australian law and the dual system of courts between state and federal matters was developed
allowing for the appeals process to theoretically function as a ladder from the Local Court all the way to the
High Court if necessary. The significance of the Australia Act cannot be understated, it provides a concrete
separation of the British and Australian legal systems, allowing them to function as independent bodies.
However, due to the shared use of the adversarial system and the origins of the Australian legal system there are
still links between the two. For example, when brought a case with an absence of precedent within Australian
law, the courts will usually consult the case law of Britain to obtain an understanding of how to assess the new
development. The Australia Act 1986 was the key to legal separation between Australia and Britain, leaving the
two nations with a healthy relationship owing to past influence and joint development.

Although the Colonial Laws Validity Act 1865 and the Statute of Westminster were significant in the of
Australian severance from the British legal system the importance of the Australia Act 1986 cannot be
understated as it effectively wrenched the Australian legal system from the overbearing British parliament and
allowed the two systems to run concurrently. However, the severance between Australia and British was purely
official as unofficially there are still ties from Australian case law to British decisions and further, the
fundamental concepts of the Australian Constitution such as representative government, good governance,
separation and division of powers were all heavily influenced and taken from the British system of governance.

Question 2
In cases of unconscionability the doctrine of precedent both constrains and gives liberty to judicial decision-
making. The notion of precedent fundamentally rests upon the idea of ‘stare-decisis’ which means ‘the decision
stands’, forcing like sets of facts to be treated the same. Thus, as Toohey J states in Louth v Diprose, ‘[Judges]
are not armed with a general power to set aside bargains simply because, in the eyes of the judges, they appear
to be unfair, harsh or unconscionable.’ Evident within the cases of Commercial Bank of Australia v Amadio
(1983) and Louth v Diprose (1992) is a slow development of common principles in regards to the determination
of unconscionable conduct, however, also evident is a cause for concern. The concern that the stories present
within these cases are as Lisa Sarmas writes in her piece ‘Storytelling and the Law: A Case Study of Louth v
Diprose’, ‘stock stories.’ And further, the notion that such stories are perpetually reinforcing themselves through
the notion of precedent. The doctrine of precedent, therefore can allow for development of principles and ideas
in cases on unconscionability but it also can constrain judges to a specific judgement and have serious adverse
effects on the social landscape of the law, thus, it constrains judicial-decision making to a moderate extent.

The case of Commercial Bank of Australia v Amadio (1983) uses the doctrine of precedent heavily. It considers
the notion on unconscionability in regards to non-disclosure of information and the advantage present from
such. It effectively demonstrates the notion of precedent as it evaluates the cases of Blomley v Ryan (1956),
Harrison v National Bank of Australia Ltd [1928] and Bank of Victoria v Mueller [1925] as persuasive on the
judgement in the eventual decision of Commercial Bank of Australia v Amadio (‘Amadio’). Although the cases
are unable to be applied directly, they present similar facts and therefore are able to impose influence upon the
eventual decision and reasoning behind such. Yet, the heavy use of precedent can be a detriment to process of
judicial decision-making. With such heavy influence upon the decision the role of the judges becomes
secondary to the past decisions, which may be detrimental in cases of such ethical and social importance as
unconscionability. Further, the central role of the judges as ‘judicial interpreters and decision makers’ can
become redundant. However, as evident in the decision with Mason J, Deane J and Wilson J deciding in favour
of Amadio with Dawson J dissenting there is room for judges to possess their own interpretation of the events to
come to alternate judgements. As evident in cases such as Blomley v Ryan (1956) (‘Blomley’) and ‘Amadio’ is
the ability for the doctrine of precedent, as a subsidiary of the common law, to fill the gaps which are left from
the statute law. For example, ‘Blomley’ considers the situation of the validity of a contract when one of the
parties is intoxicated, providing protections for individuals who are ushered into an unjust agreement whilst
intoxicated and ‘Amadio’ provides safety for all persons who are unable to understand their agreement on their
own, which, now requires banks to ensure that their customers are able to comprehend their commitments under
an agreement. Thus not only improving access to law but its overall effectiveness as an institutional embodiment
of justice. The field of unconscionability rests upon the contract law notion of equity, which, works as a
subsidiary to both common and statute law essentially dealing with the matters which ‘fall through the cracks’
within the legal system, thus, it allows for the judges of the matter to have a clear determination upon the matter.
With no existing legal principle or statute law to impose restrictions on judges there is a large amount of liberty
given to the courts to come to a decision. The doctrine of precedent within the case of Commercial Bank of
Australia v Amadio both constrained and gave liberty to judicial decision-making.

The doctrine of precedent is also featured heavily within the decision of Louth v Diprose (‘Louth’). Using the
decision above of Commercial Bank of Australia v Amadio and Blomley v Ryan to influence the decision
making of the case. The case consists of Diprose gifting Louth a house under the idea that he was madly in love
with her, yet, once he comes to his rational senses he wishes to take the house back which serves as a focal point
to introduce the notion of ‘emotional dependence’ as a factor for unconscionability. Emotional dependence here
outlines that the individual’s ability to make rational decision is clouded by his emotional state. Reminiscent of
the way in which ‘Blomley’ renders an intoxicated individual as unable to make rational decisions. Thus once
again the purpose of precedent under common law is emphasised. There is no statute, prior to the cases, which
outlines the factors of intoxication or emotional dependence as needing to be considered for contracts and other
legal agreements. Further, judicial decision-making is given liberty as the trial judge outlines, ‘there is no
exhaustive list [of weaknesses for unconscionable conduct]’ ‘Blomley’ allowing future judges to determine for
themselves whether or not specific weaknesses or conditions should give rise to unconscionability. Alongside
this is the difference in judgements, Toohey J being the only dissenting judge against Dawson J, Gaudron J and
McHugh J who prevailed in awarding Diprose the house purchased. As outlined by Toohey J, ‘Although the
concept of unconscionability has been expressed in fairly wide terms, the courts are exercising an equitable
jurisdiction according to recognized principles’ which demonstrates the paradoxical duality of judicial decision-
making within unconscionability cases. On one hand the judges are fixed to a set of legal principles handed
down through common law, yet, on the other hand those principles are expressed in fairly wide terms allowing
for the judges to make a decision with regards to the general principles and also their own specialised skill. Such
represents a fair and balanced process of decision making which, effectively develops a set of legal principles
with regards to inconsistencies or gaps in the law. On the contrary, as outlined effectively by Lisa Sarmas, ‘they
[judges] determined not only the specific outcome of the case but also the development of the doctrine of
unconscionable dating on which it is ostensibly based’ further highlighting the perpetual cycle that precedent
can take. She states that, ‘[through the narratives presented in court] we run the risk of using our own positions
of relative power to silence the voices of ‘others’ and to replace them with our own more privileged voices’ the
arguments of a court are people’s stories and through the adoption of one over another and, by extension, its
embedding within the doctrine of ‘stare decisis’ the stories of the victors are being perpetually held and verified
constantly as they are recycled for precedent. Sarmas further goes on to express how these narratives
perpetually, ‘reinforce already existing stock stories and because the law plays a powerful role in the creations
of stock stories (judges are central to this process)’ that at the heart of such is the supposedly impartial judges
who are restricted to consider and reaffirm stock stories through the use of precedent. Thus the doctrine of
precedent, especially within the field of unconscionability cases where the matters are ethically driven, poses a
large number of issues in regards to allowing justice to function effectively.

Through an understanding of the way that the doctrine of precedent functions within the unconscionability cases
of Commercial Bank of Australia v Amadio (1983) and Louth v Diprose (1992) it’s evident that it can both give
rise to liberty for the judiciary but also can impose restrictions, the presence of overwhelmingly one-sided
decisions demonstrates such a concept, yet, the presence of dissenting judges also highlights the room present
for judicial decision-making despite the constraints. The moderate extent that the use of precedent imposes
constrains upon judicial decision-making is a legal issue, which, cannot be solved easily. The very adversarial
system of law rests upon the doctrine of ‘stare decisis’ to create a system of common law. Thus, judges must be
cautious when dealing with and creating precedent to ensure that the liberties of the courts is preserved.