Spence v Queensland
High Court of Australia · 2019
Spence v Queensland [2019] HCA 15
Queensland banned donations from property developers. The Commonwealth then enacted a section protecting gifts that might fund federal election campaigns from State law. Seven Justices were asked which law stood; they did not all agree.
The Electoral Laws (Restoring Electoral Fairness) Amendment Act 2026 (Qld) omits Part 11, Division 8, Subdivision 4 of the Electoral Act 1992 (Qld), the property-developer donation prohibition that Spence considered for State elections (s 17 of the amending Act), and omits the offence provision s 307A (s 18). Those sections are not among the provisions that commence on proclamation; under s 2 they commence 28 days after assent. Transitional provisions continue the former provisions for offences committed, and for donations unlawfully accepted, before commencement. The same Act amends the Local Government Electoral Act 2011 (Qld), which Spence also considered. It does not omit the local-government prohibition, but a gift or loan by a prohibited donor to a political party that is accompanied by a written restricted donation statement is excluded from the meaning of political donation, and it is unlawful to use such a restricted donation for an electoral purpose. The amendments change which rules are in force; they do not alter the Court's orders in Spence, which concerned the 2018 provisions as they stood. Spence does not describe the State-election rules as they now are, and the local-government scheme is narrower than the one the Court considered. The Commonwealth provision that Spence held invalid has also changed: s 302CA of the Commonwealth Electoral Act 1918 (Cth) was repealed and a new s 302CA substituted from 1 December 2020 by the Electoral Legislation Amendment (Miscellaneous Measures) Act 2020 (Cth) (s 2 and Sch 1 item 25). The Court did not consider the substituted section, and the Act as compiled from 1 July 2026 records s 302CA as later amended by the Electoral Legislation Amendment (Electoral Reform) Act 2025 (Cth).
The Electoral Legislation Amendment (Miscellaneous Measures) Act 2020 (Cth) repealed s 302CA of the Commonwealth Electoral Act 1918 (Cth) and substituted a new s 302CA, headed Gifts made etc. for federal purposes, from 1 December 2020 (s 2 and Sch 1 item 25). The new section operates despite any State or Territory electoral law, and it is framed around gifts offered, sought or given expressly for federal purposes, with conditions for receiving, keeping and using them, including that a gift of money be deposited in and kept in a federal account (the Act defines federal account in Sch 1 item 2). It applies to gifts given, offered or sought on or after commencement (Sch 1 item 34(2)). Spence concerns the former section: the orders on validity and severance were made about the text inserted in 2018, and the Court did not consider the substituted section.
The Electoral Legislation Amendment (Electoral Reform) Act 2025 (Cth) (No 16 of 2025, assented to on 20 February 2025) amended s 302CA of the Commonwealth Electoral Act 1918 (Cth) by adding subsection (11) (Sch 1 item 42A): 'Disregard subsection 287AAB(3) in working out whether something is a gift for the purposes of this section.' Item 42A is in Part 1, Division 2 of Schedule 1, which commences on 1 July 2026 (s 2(1)). The amendment is to the substituted s 302CA enacted in 2020 and does not touch the holding in Spence, which concerned the former s 302CA, held wholly invalid, and the Court considered neither the substituted section nor this amendment.
What happened?
The plaintiff, Gary Spence, was formerly the president of the Liberal National Party of Queensland, an unincorporated association registered as a political party under both the Electoral Act 1992 (Qld) and the Commonwealth Electoral Act 1918 (Cth) ([7]). The Local Government Electoral (Implementing Stage 1 of Belcarra) and Other Legislation Amendment Act 2018 (Qld) was enacted on 21 May 2018, and its Parts 3 and 5 commenced on 2 October 2018 ([16]). Part 3 inserted a new subdivision into the Electoral Act, and Part 5 a new division into the Local Government Electoral Act 2011 (Qld), each prohibiting the making and receipt of a gift by a property developer to or for the benefit of a political party, among others ([19], [21]). The Electoral Act subdivision substantially replicated provisions of the Election Funding, Expenditure and Disclosures Act 1981 (NSW) that had been considered in McCloy ([18]).
The plaintiff began the proceeding in the High Court's original jurisdiction against the State of Queensland, seeking declarations that the amendments were invalid or inoperative ([8]). After the Commonwealth Amending Act was enacted on 30 November 2018 and inserted s 302CA into the Commonwealth Electoral Act, he claimed that the Queensland amendments were also inoperative by reason of inconsistency with that section, and Queensland in turn asserted that the section was invalid ([9], [22]). The Attorney-General of the Commonwealth intervened and supported the validity of s 302CA, and the Attorneys-General of the other States and of the Australian Capital Territory also intervened ([10]). The plaintiff and Queensland agreed a special case stating questions of law for the Full Court ([11]).
What did the Court decide?
Seven Justices sat. There were four sets of reasons: Kiefel CJ, Bell, Gageler and Keane JJ jointly ([1]-[112]), Nettle J ([113]-[151]), Gordon J ([152]-[275]) and Edelman J ([276]-[375]). The orders were made on 17 April 2019 and the reasons published on 15 May 2019 (cover page). The special case stated nine questions ([112]): (a) whether the Electoral Act amendments infringe the implied freedom of political communication; (b) and (c) whether the Electoral Act and Local Government Electoral Act amendments respectively intrude into exclusive Commonwealth legislative power or infringe the doctrine of intergovernmental immunities; (d), (e) and (f) whether s 302CA of the Commonwealth Electoral Act is invalid for want of Commonwealth power, under the Melbourne Corporation principle, or under the principle in University of Wollongong v Metwally (1984) 158 CLR 447; (g) and (h) whether the same State amendments are inoperative under s 109 of the Constitution; and (i) who should pay the costs. The Court ordered the plaintiff to pay the costs of the special case (order (i)). The answers to (a) to (h), and the Justices' reasons for them, are set out in the Proposition.
Proposition
What is the principle?
Subdivision 4 of Division 8 of Part 11 of the Electoral Act 1992 (Qld), which prohibits a property developer from making, and a political party from receiving, a gift, was held not invalid for burdening the implied freedom of political communication (order (a), answered "No"; orders (b) and (c), on exclusive Commonwealth power and intergovernmental immunities, were also answered "No"). The plaintiff did not seek to reopen McCloy v New South Wales (2015) 257 CLR 178, which had upheld the New South Wales provisions that Subdivision 4 substantially replicates, but to distinguish it on the footing that Queensland had not had the same recent history of corruption associated with land development applications at the level of State government ([18], [93]-[94]). Kiefel CJ, Bell, Gageler and Keane JJ held that the contest of fact need not be resolved, that this was not a case in which an adequate factual foundation for the justification was wanting, and that the subdivision, together with its New South Wales counterpart, "imposes a burden on political communication that is justified" and does not infringe the freedom ([95]-[97]). Gordon J treated the challenge as one "readily disposed of because the law is indistinguishable from that upheld in McCloy v New South Wales" ([264]). Edelman J said that the different circumstances in Queensland did not affect whether the law burdens the freedom, the legitimacy of its purpose, its suitability or the availability of less restrictive alternatives, and that the plaintiff did not submit, and there was no reason to conclude, that the Queensland Parliament placed less importance than New South Wales on the purpose of removing the risk and perception of corruption, so the invitation to distinguish McCloy should not be accepted ([324]-[326]). Nettle J, who had dissented in McCloy, said that the majority's decision in McCloy "dictates that the plaintiff's challenge to the impugned provisions must be rejected", while adding that he did not agree with it and remained of the view that the discriminatory prohibition could not be justified ([113]-[114]). The plaintiff did not argue that the equivalent provisions of the Local Government Electoral Act 2011 (Qld) infringed the freedom ([92]).
Section 302CA of the Commonwealth Electoral Act 1918 (Cth) provided that, despite any State or Territory electoral law, a person may give, and a political entity such as a registered political party may receive and retain, a gift that is "required to be, or may be" used to incur electoral expenditure or to create or communicate electoral matter, unless a listed exception applied ([29], [31]). Kiefel CJ, Bell, Gageler and Keane JJ held it within the power in s 51(xxxvi) of the Constitution, read with ss 10 and 31, to the extent that it protects a gift earmarked from the outset for use in a federal election ([55]), but not to the extent that it authorises the giving, receipt and retention of a gift that might never be used for any federal electoral purpose, because the connection to federal elections was "insubstantial, tenuous and distant" ([82]-[83]). They held it incapable of severance under s 15A of the Acts Interpretation Act 1901 (Cth) and so wholly invalid ([88]-[91]; order (d)). Because s 302CA was wholly invalid it could not make the Queensland provisions inoperative, and the joint reasons rejected the argument that the wider disclosure and foreign-donor scheme of Part XX of the Commonwealth Electoral Act was inconsistent with them ([110]-[111]); the Queensland amendments were therefore not inoperative under s 109 of the Constitution (orders (g) and (h), answered "No"). Order (e), on the Melbourne Corporation principle, was answered "Does not arise" and order (f), on Metwally, "Unnecessary to decide" ([34], [84]). Gordon J, Nettle J and Edelman J would have held s 302CA valid. Gordon J held that s 302CA is "valid: it is within power, and not otherwise invalid on any of the various bases advanced" and that the Queensland amendments are inconsistent with it and inoperative to the extent of that inconsistency ([156], [159]). Nettle J held it "a valid law of the Commonwealth which prevails over inconsistent State laws by reason of s 109" ([145]) and agreed in the orders Gordon J proposed, describing his own judgment as dissenting ([151]). Edelman J held that s 302CA is sufficiently connected with the head of power ([355]), noted that it was common ground that s 275 of the Electoral Act would be inoperative under s 109 if s 302CA were valid ([340]), and would have answered the questions as Gordon J proposed ([375]).
Why does this case matter?
Spence is usually met as a one-line citation about Queensland's developer-donation ban. That line leaves out the Commonwealth section that was set against the ban, which occupies much of the judgment, and a student who knows just the one-line version cannot say what the Court did with that section or what that meant for the State scheme.
In a problem about a donation rule, an examiner rewards the answer that keeps two questions apart: whether the State law is valid on its own terms, and whether a Commonwealth law could displace it. The case is also dated. It considered the provisions as they stood in 2019, and both the Queensland scheme and s 302CA have since been replaced or amended.
Exam and application relevance
On the implied freedom, a problem that asks for the test is answered from McCloy and Lange; Spence supplies the application of that test to a scheme that replicates the New South Wales provisions ([18], [93]-[97]).
In a problem with both a State donation rule and a Commonwealth provision protecting donations from it, deal with the Commonwealth provision's scope of power and severability before the remaining challenges to the State rule; the joint reasons took that order ([14]).
Check your understanding
1. Which Justices held s 302CA wholly invalid, and what did Gordon J, Nettle J and Edelman J each hold about it? Give a pinpoint for each. 2. Nettle J said that McCloy dictates the result on the implied freedom ([113]) and also that he did not agree with it ([114]). What did he say was his reason for disagreeing, and what orders did he agree in ([151])? 3. How did the plaintiff put his argument about McCloy ([94]), and what did the joint reasons say about the contest of fact it raised ([95])? 4. Why were orders (e) and (f) answered "Does not arise" and "Unnecessary to decide" in the joint reasons ([34], [84])? 5. A State law prohibits donations to political parties from donors in one industry, and a Commonwealth provision purports to protect gifts to parties from State law. Set out the separate questions you would ask about each law, using the way the Court proceeded in Spence.