Annex 1:
CASE LAW STUDY:
THE NATURE OF FISHING RIGHTS

INTRODUCTION

Under the common law system, rights of the public to take fish from tidal territorial waters of the kingdom can trace their origins back prior to Magna Carta:

"the right of the owner of the soil over which the waters flow (whether the owner be the Crown or not) to enjoy the exclusive right of fishing in those waters or to grant such a right to another as a profit à prendre is qualified by the paramount right to fish vested in the public.... after Magna Charta, the Crown, in whom the title to the bed of tidal navigable rivers was vested, was precluded from granting a private right of fishery, the right of fishery being in the public...."

Harper v. Minister for Sea Fisheries & Others (1989) 168 CLR 314 (Tasmania)

In the USA, the leading case of Arnold v Mundy 6NJL 1 (1821) affirmed this principle underlying public fishing rights. The defendant asserted the common law tradition of public rights of fishing in navigable waters, and succeeded in overturning the plaintiff’s claim to exclusivity of a staked-off oyster bed. The consequence was the view that property in navigable waters and the submerged lands beneath them was vested in the sovereign (be it the Crown, the state or the People), not for the sovereign’s use but for the use of citizens. The sovereign therefore was trustee for public use, and was charged with the duty of protecting the rights of the citizen. The principles of this case were later confirmed by the US Supreme Court in Martin v Waddell 41 US (16 Pet.) 367 (1842). These two cases represented the beginnings of the growth of the public trust doctrine of the United States.^[130]

It is only recently, with the problems of overfishing and stock depletion becoming alarmingly apparent worldwide, that policy has changed, in varying degrees, from this open-access view of marine fisheries and restrictive regulation has commenced. The law has consequently been obliged to resile a little from its long-held laissez-faire attitude to fisheries management, and is now obliged to discover the means by which fisheries access can be limited and stocks sustainably managed. This new policy has been implemented to varying degrees in different common-law jurisdictions.

The High Court in Harper’s Case, quoted above, continued:

"But the right of fishing in the sea and in tidal navigable rivers, being a public not a proprietary right, is freely amenable to abrogation or regulation by a competent legislature."

The "competent legislatures" have focused on this abrogation and regulation power, and thus the limited access fishing right has been created. But its essential nature differs from jurisdiction to jurisdiction.

NEW ZEALAND

Early Cases

From the outset, New Zealand courts affirmed the intent of the legislature, that ITQs were a form of property. In the unreported allocation case Jenssen v. Director-General of Agriculture and Fisheries & The Quota Appeal Authority CA 313/91, reference was made to the fact that guaranteed minimum individual transferable quotas were "valuable assets". Mr. Jenssen got his quota. Later, however, the High Court in Cooper v. Attorney-General [1996] 3 NZLR 480 decided that ITQs were property rights, but absent a provision such as the US Constitutional Fifth Amendment, Parliament, having created the property by statute, was entitled to take it away again without compensation when it was in the public interest to do so.

A series of unreported cases, the New Zealand Federation of Commercial Fishermen Inc. v. Minister of Fisheries^[131], dealt with the Minister’s right to reduce the TAC, and hence the amount of quota in the Snapper 1 management area. The various applicants applied to the High Court for judicial review of the Minister’s decisions for the fishing years of 1995-96 and 1996-97.

The governing legislation at the time was already in a state of flux, commencing with the relevant provisions of the Fisheries Act 1983, which were partially replaced with provisions of the Fisheries Act 1996 in combination with certain parts of the 1983 Act which remained in force. Part of the applicants’ claim was that both Acts had as an underlying purpose to afford proper respect to the property rights of those holding quota, and the Minister’s decision represented a failure to have regard to those rights.

Both Courts accepted that the Minister’s decision was flawed, and set it aside. But the decision was taken on other grounds, so that what was said regarding the "property" nature of quota was obiter. However, both courts were adamant that there had been no unlawful dealing with property involved in the Minister’s decision.

The learned judge at first instance in the application for judicial review accepted "without difficulty" that ITQs were a form of property right, but a right "subject to override". He examined the effect of 1990 amendments to the 1983 Act, which introduced a proportional ITQ whereby a reduction in Total Allowable Commercial Catch meant a proportionate reduction in the tonnage that may be harvested under ITQ, without compensation. This, His Honour considered, placed a qualification on the property right, but the right nevertheless was a very important one - it is sought after and traded or leased for considerable sums. However, it had what His Honour termed a "rather special character": it is "subservient to the Minister’s [statutory] powers". The right is susceptible, by the clear provisions of statute, to reduction without compensation. "It is not as though the Minister will be invading a fee simple," His Honour pointed out.

Considering the principle of the sanctity of property, as embodied in the New Zealand Bill of Rights Act, His Honour concluded that "there is no unlawful seizure when the law permits it... sanctity of property has its place in law and society, but much depends on the terms of which the property is held."^[132]

The Court of Appeal went further, and considered the matter "quite straightforward". Quota was a "species of property", and valuable. In fact the court preferred to view quota as "property", rather than as a "property right", a term which it referred to as the appellants’ expression.

However, the Court continued, the rights inherent in such property are not absolute, but are subject to the provisions of the legislation which creates them. The disadvantage of having the nature of the property altered so that its value is reduced, without compensation (as must now happen following an overall reduction in TACC) is an "incident integral" to that species of property.^[133]

Later Cases

This approach of the Court of Appeal, that ITQs are a species of property, has been confirmed in later cases. The Court was asked to decide questions of ownership of a fishing permit, catch history and "catch history benefits" in Matiriki Ltd. v. Deadman & Lees (Unreported CA15/99, 2 September 1999), on the basis of arguments of estoppel and constructive trust. Although the Court did not decide, and referred the matter back to the High Court for further decisions on questions of fact, the language used throughout the judgement indicates a settled belief in ownership of property, in relation to the permit and quota entitlements under it. That these things could be treated as property was not in issue, only the question whether or not the estoppel had arisen or the constructive trust had been created. Similarly, in Kareltrust v. Wallace And Cooper Engineering (Lyttelton) Limited (Unreported, CA192/99, CA211/99, 17 December 1999) the Court of Appeal, in discussing an action in rem against forfeited fishing vessels, accepted the wording of section 107C of the Fisheries Act 1983, and treated forfeited quota as property similar to vessels and fishing equipment.

Allocation Challenges

Not surprisingly, the earliest ITQ cases in New Zealand, as elsewhere, were challenges to the initial allocation of quota under the 1983 Act as amended. The Director-General of Agriculture and Fisheries took a narrow view of the meaning of "commercial fisherman" which was successfully challenged in Gunn v. Quota Appeal Authority [1993] NZAR 102 and in Jenssen’s Case^[134], where the Court of Appeal held that the words "commitment to, and dependence on" in section 28(3) were deliberately wide and the Director-General’s interpretation was too literal. The matter was resolved by legislative amendments, which required applicants for initial allocation of quota to hold a fishing permit already, and imposed a time bar on appeals.

Indigenous Rights

Traditional fishing rights were guaranteed to the Maori of New Zealand under the Treaty of Waitangi of 1840, but the 1983 Act made no mention of Maori rights as a defence. However, Te Weehi v. Regional Fisheries Officer [1986] 1 NZLR 680 held that customary practices had been observed by the defendant, who was not guilty of breaching the Act. This was followed by a line of cases, one of the most recent being Taranaki Fish and Game Council v. McCritchie Unreported, in the District Court Wanganui 1997, which held that the exemption of fishing for home consumption by traditional means applied to introduced species as well as native fish.

The result of challenges such as these and the courts’ liberal interpretation of the terms of the Treaty of Waitangi was a negotiated settlement represented by the interim Maori Fisheries Act 1989 and the later Treaty of Waitangi (Fisheries Claims) Settlement Act 1992, which between them established a Maori Fisheries Commission, recognized Maori commercial fisheries interests by securing a proportionate allocation of TACC for Maoris, and recognized fisheries areas of customary significance.

Summary

The paucity of New Zealand cases, coupled with the definitive language of the Acts, indicates that the question of the nature of ITQs has been settled at New Zealand law, even before the more definitively-worded 1996 Act is fully commenced. ITQs and related rights such as catch history may be regarded as "property", although it remains an integral part of the nature of these forms of property that they may be altered by the legislature that created them.

ICELAND

Several cases and administrative decisions under Iceland’s Fisheries Law have confirmed that quotas can be used as collateral for lending purposes; that they are subject to payment of inheritance tax; and that they should be treated as property in divorce cases.^[135]

Another line of Iceland cases challenged various aspects of the law. In 1998 the Supreme Court decided that the requirement for fishers to hold, in addition to ITQs, an annual non-transferable fishing permit, was unconstitutional as it violated the two constitutional principles of economic freedom and equal treatment under the law. The following year, however, the Court decided that the use of ITQs as collateral did not violate the principle that fish stocks in Iceland waters were the declared common property of the Iceland nation.

In 2000, a more direct challenge was mounted against the issue of ITQs on the basis of catch history, again based on the argument that the principles of economic freedom and equal treatment before the law were thereby violated. The Supreme Court however rejected the argument. One of the reasons for the Court’s view was that the transferability of ITQs meant that they were not confined to any narrow group of people but were theoretically available to all.^[136]

AUSTRALIA

Although Australian states and the Commonwealth are all separate jurisdictions each with its own jurisprudence, nevertheless an extremely high persuasive value is placed in each jurisdiction on the law of the others. Hence it is possible to consider Australian cases together, notwithstanding that they are based on different statutes.

In contrast to New Zealand, where there has been very little litigation over the nature of ITQs, Australia has produced a spate of litigation concerning fisheries quotas, mainly under the Commonwealth legislation but partly also under state legislation. Many of the early cases were challenges to initial allocation processes, but another line of cases questioned the very nature of limited access licences and other authorities, as they were gradually imposed under legislation that was, in the main, later repealed over the last decade.

Early Cases

The first cases, from the late 80’s, questioned the nature of the rights granted under various state Acts which have since been replaced. These repealed statutes, in their amended forms, represented the first evolution of the initial methods of imposing access restrictions on fishers. Questions were frequently posed as to the nature of the newly created concept of limited access rights; the questions arose in various contexts.

One of the earliest, if not the first, of these is the 1987 case of Pennington v. McGovern (1987) 45 SASR 27, in which the Full Court of the Supreme Court of South Australia held that a fishing licence, held pursuant to the Fisheries Act 1982 (SA) which was linked to the registration of a boat, was property for the purpose of becoming the subject of a trust. The court said:

"It is clear from the provisions of the Act and regulations... that the licence in question is no mere personal, inalienable right. It is a transferable right which is contemplated as having value ... [t]he valuable nature of the right is confirmed by its transferability and by its being linked in both the Act and the regulations with the registration of boat and equipment and to the transfer thereof. The provisions of the regulations... as to the contemplated value and transferability of the licence and as to the right to hold it notwithstanding that its exercise is subject to the direction and instructions of another, are all... indicia of rights of property... the rights conferred by the licence are proprietary in character."

Subsequently, it was held in Austell v Commissioner of State Taxation (1989) 89 ATC 4905 (WA), a Western Australian case, that a fishing licence relating to a boat was property for the purposes of levying stamp duty on a sale. At the same time, though, in the Victorian case of Pyke v Duncan (1989) VR 149, licences under Victorian and Commonwealth legislation were not property available to a sheriff for seizure in satisfaction of a writ of fi fa. In Pyke’s Case, though, the licences were not related to a boat, and the decision as to their proprietary nature was for different purposes. The Court considered that transferability did not assist in this situation, and declared that there was "a substantial and significant difference between the capacity of a licence holder to market a licence and that of the Sheriff to pass on a good title to a bona fide purchaser in order to satisfy a judgment." And as was noted subsequently in Poulos Bros (Wholesale) Pty. Ltd. v Abbott Supreme Court of Tasmania Judgment No. A88/1994, distinguishing this case and others like it, Pyke’s Case was concerned with the question of whether a personal licence relating to a particular boat was capable of constituting property independently of that boat.

Soon afterwards in 1990, the High Court on appeal in Kelly v Kelly (1990) 92 ALR 74 (SA) decided that an abalone authority issued under the South Australian Managed Fisheries Regulations 1971, referable to a particular boat, gave rise to rights which were capable of being held so as to constitute partnership property. Transfer of the authority for consideration, although heavily restricted, was nevertheless possible and thereby increased the value of the boat with which it was connected.

Harper’s Case

The foregoing cases all arose in the context of the application of the law of various states. In 1989, however, the High Court of Australia was required to examine the essential nature of the right granted under a quota system and the right of a state to legislate to limit fishing rights. The case of Harper v. Minister for Sea Fisheries & Others^[137] concerned the abalone fishery of Tasmania, then governed by the now repealed Tasmanian Fisheries Act 1959. A proportional quota system was established in 1985 in connection with the statutory requirement to purchase a fishing permit. The number of permits issued was limited, for the preservation of the fishery. The plaintiff challenged the validity of the permit fee, on the ground that it amounted to an excise. The defendants argued inter alia that the amount required to be paid to obtain a licence could be said to be paid for a profit à prendre - for the right to take abalone rather than for the abalone taken.^[138] A case was stated to the High Court of Australia, which involved questions of state rights vis-à-vis those of the Commonwealth.

The abalone fishing grounds underlaid tidal waters. The Court acknowledged the paramount right to fish in tidal waters vested in the public by the common law. In non-tidal waters, the right of the owner of soil over which waters flow is to enjoy the exclusive right of fishing in those waters or to grant such a right to another as a profit à prendre. But in tidal waters, that right is qualified by the public right of fishing, which predominates even where title is granted to the seabed. However, that right is a public, not a proprietary right, and may be abrogated by legislation. There is a difference between a proprietary right and legislative jurisdiction.

If title is required to validate the right of the Tasmanian legislature to grant a licence, that was derived from the arrangement between the Commonwealth and the State of Tasmania regarding the right to legislate in respect of the Tasmanian abalone fishery. So a competent legislature has excluded the public by granting licences to a limited number of persons to take from the fishery. The right the licensees consequently enjoy resembles the common law right of piscary - a right to fish in another’s waters to the exclusion of the public, which is a kind of profit à prendre.^[139]

At common law such a right is not available in tidal waters. However, through the introduction of a new statutory regime limiting the public rights of access, a right had therefore been created which is analogous to a profit à prendre, although it is in reality "an entitlement of a new kind". The Court said:

"A statute which prohibits the public from exercising a common law right to exploit the resource and confers statutory rights on licensees to exploit the resource to a limited extent confers on those licensees a privilege analogous to a profit à prendre in or over the property of another. A fee paid to obtain such a privilege is analogous to the price of a profit à prendre; it is a charge for the acquisition of a right akin to property."

Following Harper

In Harper’s Case, the High Court was apparently inclined to renege somewhat from the clear position that transferable fishing rights are property. The Administrative Appeals Tribunal in 1992 in Re Ollrich AAT No. 8082 decided that an endorsement for Southern Bluefin Tuna quota on a fishing licence issued under the Commonwealth Fisheries Act 1952 was separate from the licence so that its cancellation did not amount to cancellation of the licence. In rejecting a claim by the plaintiff that both the licence and the endorsement were property rights due to their transferability and consequent value, the Tribunal said:

"It is the view of this Tribunal that the endorsement possessed by the applicant could not be categorised as a proprietary right. In this regard, I have been assisted by the view expressed by the High Court of Australia in Harper v Minister for Sea Fisheries and Others..."

The Tribunal was, of course, bound to follow the High Court’s findings. But subsequent cases did not continue the distinctions that Harper’s Case drew. Two series of cases before the Federal Court concerning fishing rights in the Northern Prawn Fishery managed under the Commonwealth Fisheries Act 1952 decided that the rights were property. This fishery is managed not by quotas, but by "unitizing" the vessels involved: a B unit representing the right of the vessel to fish in the fishery, and A class units representing the vessel’s fishing power, measured by size, engine capacity etc. In other words, they were not quota units, taking their definition from vessel capacity rather than amount of catch taken. But the units were tradable and became the currency of the fishery. However, when a progressive reduction for management purposes resulted in a loss of value of units held and of fishing capacity for those holding units, several applicants challenged the reduction on Constitutional grounds.

Section 51 (xxxi) of the Australian Constitution provides that:

"51. The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:

(xxxi.) The acquisition of property on just terms from any State or person for any purpose in respect of which the Parliament has power to make laws."

A group of appeals from the initial Federal Court decisions were heard together and cited as Minister for Primary Industry and Energy v Davey (1993) 47 FCR 151. At first instance^[140], the Court had decided that the fishing units held by the applicants were property, and followed the statement in Harper’s Case that:

"In that context, the commercial licence fee is properly to be seen as the price exacted by the public, through its laws, for the appropriation of a limited public natural resource to the commercial exploitation of those who, by their own choice, acquire or retain commercial licences. So seen, the fee is the quid pro quo for the property which may lawfully be taken pursuant to the statutory right or privilege which a commercial licence confers upon its holder."

The Court also agreed with the High Court in Kelly v Kelly^[141], and disagreed with the conclusions of Pyke v. Duncan^[142], saying:

"In my opinion a licence to fish brings with it a privilege and a right that is proprietary in nature. Subject only to such constraints (if any) as may be found in the governing legislation, it is properly classified as "property". In principle I can see no difference between such a licence and the units of fishing capacity in the case at bar. They are as important to the fisherman as his licence and his boat. Without them, he cannot fish even though he is licensed and his boat is registered. I hold that the units are property."

This court also decided that the property had been "acquired" in the terms of the Constitution, and that the acquisition was unjust. Subsequently, the Management Plan was amended so that in the second of these cases, Davey and Fitti v Minister of Primary Industry and Energy (1993) 113 ALR 335, a different Federal Court judge held that acquisition of property on just terms had been provided for.

Appeals from these 2 cases were heard concurrently, and the appellate Court affirmed the decision that the fishing units were property for the purposes of the Constitution:

"Of the use of the word "property" in this constitutional guarantee, it has been said that it "extends to every species of valuable right and interest including real and personal property, incorporeal hereditaments such as rents and services, rights of way, rights of profit or use in land of another, and choses in action. And to acquire any such right is rightly described as an ‘acquisition of property’... "

However, the Court continued:

For the respondents it was submitted that the units constituted property analogous to a profit-à-prendre in the N.P.F. The analogy is not exact. The right to fish within territorial waters is an attribute of the Commonwealth's sovereignty, rather than a proprietary right available under private law; see Harper v Minister for Sea Fisheries ....

In the instant case, the units may be transferred, leased, and otherwise dealt with as articles of commerce. Nevertheless, they confer only a defeasible interest, subject to valid amendments to the N.P.F. Plan under which they are issued. The making of such amendments is not a dealing with the property; it is the exercise of powers inherent at the time of its creation and integral to the property itself."

The following year, the Federal Court also decided, in Bienke v Minister For Primary Industries And Energy (1994) 125 ALR 151, that alterations to the Management Plan for the Northern Prawn Fishery under the Fisheries Act 1952, continued by the Fisheries Legislation (Consequential Provisions) Act 1991, did not infringe Constitutional guarantees; were not invalidly done and therefore no claim for damages could lie; the Management Plan itself had the force of law; fishing units were issued subject to the Plan which was to be amended from time to time, and they therefore had an element of instability from the time of their creation. The court noted:

"It also is significant for this case that the common law right or liberty to fish in the sea and in tidal navigable rivers is a public not a proprietary right and as such is amenable to abrogation or regulation by legislation: Davey at 160, 168-169."

And further:

"However, the licensing system of which the Plan was a significant part, did not operate to create, by means of the units of fishing capacity, any right in substitution for what had been previously existing private interests in the natural resources of the fishery. The legislation is cast so as to impose prohibitions which may be lifted by compliance with the licensing system. The imposition of the prohibitions did not abrogate what, in the case of the operators and potential operators in the NPF, were common law rights.... They were public rights, as discussed, in particular, in the authorities referred to by Burchett J in Davey at 168-169. Contrary to what was contended by counsel for the applicants, the reference by Mason CJ, Deane and Gaudron JJ and by Brennan J in Harper at 325, 334-335, to a privilege which might be compared to a profit à prendre was not to the pre-existing situation at common law."

An appeal from this decision was decided in 1996.^[143] The appellant had contended that alterations to the Management Plan constituted legislation extinguishing a cause of action against the Commonwealth, which amounted to acquisition of property under section 51(xxxi) of the Constitution. The Court said:

"... [It was} argued that the appellant's right to reap a resource was "analogous" to a profit à prendre or to a cause of action. This submission was primarily directed to the question whether the fishing boat licence could be regarded as property for the purposes of section 51(xxxi). .... But a fishing boat licence granted under section 9(2) of the Fisheries Act does not vest in the holder a cause of action under the general law, nor does it create an interest based on antecedent rights recognised by the general law .... Legislation which prohibits the public from exercising a common law right, so as to prevent uncontrolled exploitation of a resource, and confers statutory rights on licensees to exploit that resource to a limited extent, might be regarded in one sense as creating a right analogous to a profit à prendre: Harper, at 335. However, the right is not a common law right, but rather a new species of statutory entitlement, the nature and extent of which depends entirely on the terms of the legislation... Thus, the fact that the holder of the boat licence, on one view, might have a privilege comparable to a profit à prendre, does not mean that he or she has an entitlement based on antecedent proprietary rights recognised by the general law. It also does not mean that the licence is incapable of modification or extinguishment without constituting an acquisition of property, if that course is permitted by its terms."

(emphasis added).

The Court applied Davey’s Case in holding also that there was no acquisition of property in the sense required by section 51(xxxi) of the Constitution, and therefore there was no compensation required. The Court said:

the compulsory surrender of units effected by NPF 11 did not result in the Commonwealth, or any other person, acquiring an identifiable proprietary interest in the NPF or in any other species of property. Nor did the Commonwealth, or any other person, acquire a direct financial benefit or gain commensurate with any interest of the appellants that was extinguished or terminated. Whether attention is directed to the units of fishing capacity, as in Davey, or to the fishing boat licence, as in the present case, the compulsory restructuring scheme did not result in any other person acquiring the entitlement to take prawns from the NPF previously enjoyed by the first appellant as the licence and unit holder....

Nor did the imposition of a fee constitute an acquisition of property; rather, it was a levy on items of value, the fishing units.

Fitti, Davey and Harper were all cited with approval in the Poulos Bros Case.^[144] In that case, the question was whether a bill of sale effected a transfer of boat, equipment and licence issued under the Tasmanian Sea Fisheries Regulations 1962, or not. Clearly, no legal transfer of the licence could have taken place, as the transfer process had not been undertaken in accordance with the requirements of the Regulations. However, the Tasmanian Supreme Court found that as the licence was property, a beneficial interest nevertheless arose, so as to create a mortgage in equity.

Similarly, the Tasmanian Supreme Court in Gasparinatos v. The State of Tasmania (1995) 5 Tas R 301 followed Harper in deciding that rights to take abalone in Tasmanian waters were valuable property rights.

Recent Cases

Subsequent cases in the last decade have followed the reasoning in the earlier state cases, the pattern of which was set by Kelly v Kelly. The Poulos Bros Case^[145] was concerned with the completeness of a purported assignment of a boat, craypots and licence under the Tasmanian Sea Fisheries Regulations 1962. The Tasmanian Supreme Court reviewed the previous cases on the property nature of licences, and drew distinctions between licences that related to a boat, and those that did not, and were not proprietary in nature. The court’s decision was also based, like the cases before it, on the fact of the transferability of the licence for value.

The Court then drew a further distinction. It said:

"...it is necessary to emphasise the distinction between the grant of a licence, which confers a personal right, and the nature of that licence once it has been granted when it becomes proprietary in nature in that the bundle of rights may constitute property."

Edwards v Olsen (1996) 67 SASR 266 also continued this line of cases in holding that a licence issued under South Australian legislation, as amended between the 60’s and the 80’s, was property capable of being held in trust. Following Pennington v McGovern and Kelly v Kelly, the Court held that licences, permits, registrations and authorities were all "clearly 'property', the beneficial ownership of which can form the subject matter of legal relationships, absent some express statutory provision to the contrary".

In 1998, the South Australian Supreme Court in Lukin v Lovrinov [1998] SASC 6614 again affirmed that a transferable tuna fishing quota introduced in 1984 by the Commonwealth Government under its Fisheries Act 1952 was property capable of becoming a partnership asset (although in this case it was held not to be so). And most recently, in Tasmanian Seafoods Pty Ltd v Peters [1999] QSC 144, the Queensland Supreme Court was concerned with a trochus collection licence issued under the Queensland Fisheries Act 1976 and continued under the replacement Fisheries Act 1994 and Regulations made under it. When originally issued, the licence was non-transferable, but upon the making of Regulations under the 1994 Act, it became transferable. A deed of sale of the licence/authorisation was executed in 1993 under which the Vendor agreed to hold the licence in trust for the Purchaser until it became transferable, whereupon it was to be transferred. The Queensland Fisheries Management Authority refused to give effect to any transfers.

On the question of the right to just compensation for deprivation of property, when scallop licences were cancelled under Victorian state legislation due to closure of the fishery, the case of Stockdale v. Alesios^[146] held that the common law rule did not apply where the statute had already made provision for compensation (whether or not the compensation was just or adequate). The court found that despite the original bar on transfer of the legal interest in the legal interest in the licence, nevertheless it was property the beneficial interest in which was capable of assignment. Although assignability is usually a characteristic of property, it is a consequence, not a test.

Finally, in the recent native title case series known as the Croker Island Case^[147], the High Court upheld the lower court decision that native title to the seabed and superjacent waters does not "confer possession, occupation, use and enjoyment of the sea and sea-bed within the claimed area to the exclusion of all others", but only to the exclusion of other Aboriginal groups. This decision was based on a finding that native title rights could only co-exist with common law rights to the extent that they were not inconsistent, and a claim of exclusive right over an area of territorial sea was inconsistent with common law public rights of navigation and fishing and the international law right of innocent passage. The two sets of rights therefore could not stand together.

Features of Australian Cases

The Test of Property

Transferability is but one of the "bundle of rights" that go to make up property in the Anglo-Australian legal system. However, the Australian cases have overwhelmingly relied on the transferability test to determine the property nature of the limited-access licence or other authority. Kelly v Kelly, Pennington v McGovern, Austell Pty Ltd v Commissioner of State Taxation, Fitti v Minister for Primary Industries and Energy & Anor and the cases that approved and followed them all turned on the transferability point, even though the transfer may be restricted. Transferability creates value; and the ascription of value creates the property nature.

The Tasman Seafoods Case, however, makes the point that transferability is not a sine qua non. A line of authorities^[148] guided the Court away from the transferability test as a determinant. It is not necessarily an essential characteristic of property; some statutes render inalienable what is clearly property. In general, the test is merely that the proprietary right should be, in some way, capable of assumption by third parties; lack of this ability does not defeat the proprietary nature, but only tends against the conclusion that it is property.

Rights Against Whom?

However, not all the Australian cases have considered this aspect of property rights. Those which have may be characterised by the fact that in each one, an adjustment of rights as between private parties is under consideration. But when it comes to an adjustment of rights as between a citizen and the state, the courts have been a little less swift to find a complete characterisation of property.^[149]

The leading case in this respect is Harper, which did not, in fact, find that the abalone licence in question was property at all, but that the licence fee was analogous both to the price of a profit à prendre, and to a charge for the acquisition of a right "akin to" property. What this actually meant was that while the privilege of commercial exploitation of a public resource for profit may be compared to a profit à prendre, it is actually "an entitlement of a new kind".

The Bienke Case confirmed the Harper approach, and added:

"Thus, the fact that the holder of the boat licence, on one view, might have a privilege comparable to a profit à prendre, does not mean that he or she has an entitlement based on antecedent proprietary rights recognised by the general law."

And again:

"... the right is not a common law right, but rather a new species of statutory entitlement, the nature and extent of which depends entirely on the terms of the legislation."

In that case, the Court merely assumed, without deciding, that the licence created an interest "capable of amounting to" property. It was not necessary to decide, as the appellant’s claim to unconstitutional acquisition of property was defeated on other grounds.

The Davey Case^[150], which was referred to extensively in the Bienke Case, confirmed that this new creation stopped short of being full property, although finding that it was property for the purposes of section 51(xxxi) of the Constitution. The Court said:

"In the instant case, the units may be transferred, leased, and otherwise dealt with as articles of commerce. Nevertheless, they confer only a defeasible interest, subject to valid amendments to the N.P.F. Plan under which they are issued. The making of such amendments ... is the exercise of powers inherent at the time of its creation and integral to the property itself."

In this, the Australian courts appear to be in agreement with the New Zealand Court of Appeal in New Zealand Federation of Commercial Fishermen Inc. v. Minister of Fisheries. Limited access fishing licences, quota allocations etc. are a species of property, but the rights in them are not the same as antecedent rights that attach to other property under common law: ownership of this property is not full, but qualified, ownership. A portion of the "bundle of rights", including the right to vary and even extinguish the species, remains with the state, which created the property through legislation.

State Title

To say that a species of property may be created by statute enacted by a "competent legislature" then begs the question: by what right does the state create and allocate the property? What radical title does the state hold, that it may choose to grant to private persons?^[151]

Harper’s Case considered this question, in noting that since Magna Carta, the Crown held the title to the seabed beneath the waters but was prevented from granting a private right of fishery. The public had rights to fish in tidal waters, but that that right is a public, not a proprietary right, and may be abrogated by a competent legislature. There is a distinction between proprietary rights and legislative jurisdiction.

The situation was summed up recently in the related case of Yanner v Eaton [1999] HCA 53, a High Court appeal from the Court of Appeal of the Supreme Court of Queensland regarding the Fauna Conservation Act 1974 (Q). The Court commenced by affirming that there could be no property in wild animals, including living fish of the sea. State ownership of such things is more a form of guardianship for social purposes. The right to legislate in respect of sea fish, which belong to no-one while living in the wild^[152], is an incidence not of ownership but of sovereignty.^[153]

The Croker Island Case^[154] affirmed that rights over the territorial sea cannot be held as property. The common law has bequeathed a legacy of public rights of fishing and navigation in tidal waters, and the rights of the state are of a different kind.

It is possible, therefore, that the claims of Tasmania and Victoria to "ownership" of living marine natural resources are not well founded. These assertions have not been challenged in the courts, but resolution of the question, if it arises, will turn on the implications of the term "ownership" in the context of state sovereign rights.^[155]

Allocation

Numerous challenges were made to the initial allocation procedures of the various Commonwealth and state fisheries. The most significant is the Austral Fisheries Case^[156], which held firstly that the Minister’s declaration of a management plan for the South East Trawl Fishery made under the Commonwealth Fisheries Act 1952 is delegated legislation, and not an administrative act; and secondly that the formula used to determine catch history, even applying the most stringent tests as was appropriate for scrutiny of delegated legislation, was manifestly unreasonable. The plan was therefore ultra vires.

Summary

In Australia, the limited access fishing rights which have been created under the fisheries legislation of the various states and the Commonwealth are usually property for the purposes of adjustment of rights as between private citizens. The principal indicator of the property nature is the transferability of the authorisation, although this is not a determinant test but more an indicator.

As between private persons and the state, however, the right-holder is not usually entitled to assert his right in the face of a lawful variation by the state of that right for management purposes. The state’s underlying right of guardianship for social purposes means that this guardianship may be exercised against individual right-holders for the good of the community as a whole. The state or its management agency retains some measure of the cluster of rights that go to make up the property right.

This gradation of levels of ownership had long been the situation in the general law in relation to, for example, interests in land. But because open access to the sea and its resources has been a public right since the early days of the common law, the concept of divided rights has not been so well developed in the case of sea fisheries.

The Australian cases have not established a clear-cut determination of the nature of limited-access fisheries rights. However, the cases so far have been almost invariably concerned with determination of rights under legislation, both state and Commonwealth, which has now been repealed and replaced with new legislation. Despite the fact that these new legislative regimes have been in operation for more than half a decade, in most instances, there has been so far little evidence of litigation under their terms, at least in respect of determination of the rights conferred under the legislation. This is partly, at least, due to the fact that it is now settled Australian law that limited access fisheries rights are considered to be property for most purposes, including those of the Australian Constitution; but partly also to the fact that Australian legislatures must have been forewarned by the spate of cases that followed the introduction of the first quota systems, and devised new laws accordingly. Nevertheless, the very fact that no legislature has gone so far as to establish a fully transferable right in perpetuity, as has been the case in New Zealand, indicates that Australian legislatures may still be wary of the consequences of doing so.

Tsamenyi & McIlgorm (2000) at p.95 sum up rights in Australian legislation as interpreted by case law as follows:

• courts have generally acknowledged that the various forms of rights are capable of being considered "property";
• licences are "property", but only on the terms as provided by statute;
• the property rights are in general weak. Factors contributing to this include discretionary intervention powers vested in fisheries managers; transferability is limited by the consent required and other statutory conditions; entitlements may be suspended or cancelled for commission of offences; compensation provisions are generally inadequate; many entitlements (usually licences) are limited in duration.

USA

Like New Zealand, the USA case law discussing the nature of IFQs is limited, although for a different reason: only three IFQ programmes have been fully implemented in federal waters, although more are expected now that the ban on new programmes has been lifted. But the US courts have come to different conclusions as to the nature of the rights created by the legislation.

The combined cases of Sea Watch International et al. v. Mosbacher and Pearson et al. v. Mosbacher 762 F.Supp. 370, 9 April 1991 dealt with the introduction of a proportional quota system into the surf clam and ocean quahog fisheries, following a proposal by the Mid-Atlantic Regional Fishery Management Council. The IFQs are described as "transferable permits to fish for a fixed percentage of the annual aggregate catch quota for the species and area".

The plaintiffs argued that the introduction of IFQs amounted to privatisation of the fishery; these private rights could be transferred; and this was not authorised by the Magnuson-Stevens Act. However, the Court pointed out that:

"Congress did authorize the creation of quotas. The Act expressly authorizes the Council and the Secretary to impose permit requirements and to establish limited access systems. 16 U.S.C. §§ 1853(b)(1), (6)... the language of the section broadly embraces the possibility of quotas. Nothing in its terms, and nothing else in the Magnuson Act cited to this Court, precludes making quotas transferable."

The court continued:

"... the interests created by [the IFQ system] fall short of actual full-scale ownership... The new quotas do not become permanent possessions of those who hold them, any more than landing rights at slot-constrained airports become the property of airlines, or radio frequencies become the property of broadcasters. These interests remain subject to the control of the federal government which, in the exercise of its regulatory authority, can alter and revise such schemes ... An arrangement of this kind is not such a drastic departure from ordinary regulation, nor is it so akin to the sale of government property, that the Court must require a more precise expression of congressional intent to uphold it."

Clearly, the Court in the Seawatch Case was reluctant to find any trace of "privatisation" of a public resource. It did this both by finding that the clear words of the statute enabled the issue of quotas, provided the statutory requirements regarding appropriate evidence of the need for closer management, appropriate prior consultation, and appropriate conformity with the standards elaborated in the Act and elsewhere, had been met; and by finding that there was no property granted or transferred in the quota issue process, such that it could amount to privatisation. In this, it has both upheld the principle of public right of fishing, and avoided any suggestion of privatisation of a public resource.

By contrast, however, the US Court of Appeals in the later case of Foss v. National Marine Fisheries Service 161 F.3d 584 (9^th Cir. 1998) found, in relation to the appellant’s claim that he had a constitutionally protectable property interest in obtaining an IFQ permit in the North Pacific Halibut and Sablefish Fishery, that:

"There can be no doubt that the IFQ permit is property. It is subject to sale, transfer, lease, inheritance, and division as marital property in a dissolution."

The Court however proceeded to distinguish the property right in obtaining the specific permit from any claim of owning the fish themselves, which was "pure fantasy". More significantly, the Court found that:

"Unlike the specific, mandatory regulations implementing the IFQ programmes, the language of the Magnuson Act does not confer any claim of entitlement or property rights."

It is this last point upon which the Foss Case may be distinguished from the earlier Seawatch Case. The challenge in the Seawatch Case was founded on the language of the Magnuson Act itself. In the Foss Case however, the appellant’s claim looked in the first instance to mandatory directives in fishery-specific Regulations. Moreover, it was a different fishery, governed by different Regulations.

Again, Courts have stressed that the nature of the right depends on the statutory rules creating it. A person entitled by the rules to receive a permit had a protectable property interest. However, like the Australian cases dealing with the constitutional issue of section 51(xxxi.), the Court in the Foss Case was able to avoid finding liability for property deprivation on other grounds - it decided that procedural due process had been observed by the government when the initial allocation process was undertaken.

It is notable also that in the Foss Case the court was not called upon to decide the nature of the IFQ permit itself, but merely the right in the plaintiff to obtain the permit. This is a long way from the mere usufruct or revocable privilege view first taken in the USA towards IFQs, and appears to be somewhat removed from the language of the Act itself, which the Court was careful to distinguish. It appears that, despite the crafting of the Sustainable Fisheries Act by Congress to avoid any suggestion of property rights, in one US fishery at least, limited access fishing rights, and even the rights associated with them, are in fact property.

Fisheries prosecution case law is also limited in the USA, as most infringements are dealt with under the administrative law system.

SOUTH AFRICA

In 1998/99, following the commencement of the new Marine Living Resources Act, which provided for the allocation of fishing rights, a legal challenge was mounted to the redistribution of rights in the rock lobster fishery. The challengers, who held rights under the old pre-apartheid legislation, were successful in the Supreme Court, triggering a stream of similar applications from former rights-holders. Fortunately, this situation has not lasted and new allocations soon commenced under the new legislation. However, the administrative chaos caused led to political upheaval.^[157]