By Terence Mills

Section 44 of the Australian Constitution has been one of the most vexing for the High Court in recent times. The sub-section receiving most attention at present is section 44(v) which says that any person who has “any direct or indirect pecuniary interest in any agreement with the public service or Commonwealth” cannot be elected to our parliament.

The purpose of this section appears to be an anti-corruption measure introduced by those who drafted our Constitution, designed to stop people sitting in Parliament and at the same time making money through contracts with the Commonwealth. The question is, how literally do you take this measure without looking silly and pedantic?

Former Senator Bob Day recently fell foul of this section although he quit the Senate in November last after his Home Australia building empire went into liquidation. Subsequently the government referred questions over the validity of his election to the High Court of Australia sitting as the Court of Disputed Returns. Independent legal advice indicated he may have had an indirect pecuniary interest in a lease he organised with the commonwealth for his electorate office on Fullarton Road in Kent Town, South Australia.

A majority of the court’s judges found Mr Day was incapable to sit as a Senator from February 26, 2016 — the date Fullarton Investments directed the government pay rent to a bank account owned by Mr Day.

Chief Justice Susan Keifel said:

“It was unanimously held that the financial benefit which Mr Day stood to obtain from the commonwealth performing its obligations to pay rent pursuant to the lease constituted an ‘indirect pecuniary interest’,”

“By virtue of the direction that the rent be paid into a bank account owned by him, Mr Day was to receive rent directly from the Commonwealth. Therefore he had an expectation of a pecuniary benefit from the lease.”

So, on that basis alone Senator Day forfeited his right to being elected to the Senate. Not one to do things by half measures, Senator Day also disqualified himself under Section 44 (ii) following his bankruptcy and the insolvency of his business : what in legal circles is known as the double-bunger effect.

No sooner had Bob Day left the building than we have National Party, Assistant Health Minister David Gillespie who it seems could also have an indirect pecuniary interest arising from a Commonwealth (Australia Post) lease of part of a small shopping centre in Port Macquarie owned by Gillespie. He too may be facing removal from federal office under section 44(v) of the constitution if the High Court find, as they did with Day, that he is receiving a financial benefit from the Commonwealth.

The matter has been referred to the Court of Disputed Returns by Labor – not so much to find out why it is that the majority of regional shopping centres around the country appear to be owned by Coalition members of parliament, intriguing as that is and certainly worthy of an X-Files type investigation by Mulder and Scully – but more so to obtain the Court’s advice on the scope and reach of section 44 (v).

A worthy endeavour you may say although, Julie Bishop calls it another Labor stunt: she probably says that because, if Gillespie is found to be wanting and has to surrender his seat of Lyne in New South Wales, that would lead to a by-election and the possibility of a hung-parliament if not retained by the Coalition.

Gillespie says he and his wife, through their company Goldenboot, lease the space to a local woman who is an Australia Post licensee meaning, according to him, that he has no direct financial link to the postal service. But, of course, the Constitution talks of both direct and indirect pecuniary interest and this is where the High Court judges need to give some definitive direction: after all, we don’t want to see Coalition politicians having to relinquish their monopolistic grip on regional shopping centres.

At a Senate estimates hearing on May 23, Attorney-General George Brandis revealed he had urged Dr Gillespie to seek his own legal advice on the matter. He did, from prominent Sydney barrister Guy Reynolds, SC. However Dr Gillespie has, oddly in my view, resisted calls to release Mr Reynolds’ advice publicly.

Evidently Mr Reynolds’ opinion is that Dr Gillespie does not have a section 44 problem. Senator Brandis said in the hearing. “I have not written any advice in relation to the matter but I can tell you that I discussed the matter with Dr Gillespie and I formed the preliminary view that his arrangements were nowhere near a section 44 problem because of the indirectness of the interest.”

In the meantime, UNSW constitutional law expert George Williams believes Dr Gillespie could still be in trouble – particularly if the High Court settles on a broad definition of “indirect pecuniary interest” as in the Bob Day case.

So, is it a Labor stunt as the Coalition would have us believe or is it a necessary and legitimate request for clarification from the High Court on the scope of this section of our Constitution or is it all a storm in a tea-cup and we should not interfere with Coalition members’ real estate portfolios? We shall soon see.