The ACT government is set to learn within days whether it can proceed with what has been described as a "hostile" takeover of Calvary Public Hospital.
The fate of the Bruce hospital now rests with a full bench of the ACT Supreme Court, which is expected to rule no later than next Tuesday on the validity of legislation passed to enable a planned compulsory acquisition.
Calvary Health Care ACT urged the court on Wednesday to block the takeover, with its barrister arguing the government's "extraordinary and unique" legislation was invalid.
Barrister David Williams SC said there had been nothing quite like it since the 1940s, when the High Court scuppered the Commonwealth's plan to nationalise private banks.
That case dealt with the issue of constitutional requirements for property to be acquired on "just terms", which Mr Williams argued would not happen under the Calvary legislation.
He described his client as "a charitable institution which has served the community with dedication for 40 years", noting it had 1800 public hospital employees, hundreds of contracts with third parties and at least 75 years remaining on its operating licence.
The government's plan to compulsorily acquire the hospital on July 3 would, Mr Williams told the Supreme Court, amount to a "hostile", or at least unwelcome, takeover.
"The whole of [Calvary's] business is sought to be taken from it by the territory," he said.
Mr Williams noted the legislation contained a section that required the government to complete the acquisition on just terms, which would include "reasonable compensation".
But he said that section merely contained "some aspirational language", arguing it did not actually provide a mechanism for Calvary to obtain just terms.
"If we're right about that proposition, this Act is invalid," Mr Williams said of the legislation.
He expanded on this issue in his written submissions, describing the terms of the planned acquisition as "anything but just".
"They fail to pay compensation for the acquisition of the business," the submissions state.
"They fail to provide 'full compensation' and have numerous other features which are unjust, or at least not just."
Mr Williams also took issue with what he described as "oppressively vague" obligations that would be imposed on Calvary to assist with the transition to government control.
In oral argument, Mr Williams suggested the legislation was deficient because it had been rushed to accommodate the government's "self-induced urgency" to acquire the hospital.
Lawyers for the ACT government, on the other hand, argued the takeover legislation did not need to expressly set out the terms on which Calvary would be compensated.
The government's barristers also said a regulation associated with the legislation provided a basis for Calvary to apply for compensation.
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In oral submissions, ACT solicitor-general Peter Garrisson SC further argued Calvary had not challenged the core provisions of the takeover legislation.
Chief Justice Lucy McCallum indicated she, Justice David Mossop and Justice Belinda Baker planned to rule on the legislation's validity no later than next Tuesday.
"If we can make orders before the end of the week, we will," Chief Justice McCallum said.
In the meantime, the ACT government extended its undertaking to hold off on exercising certain powers, including entering Calvary's land, until close of business on Friday.
Mr Garrisson said he would take instructions on whether the government would be content to extend that undertaking again until next Tuesday.
Earlier, Chief Minister Andrew Barr said the ACT government would "correct" its Calvary acquisition legislation if the court found it was invalid in its current form.
"If the court were to find an error of law, then we would correct the error of law that they had identified," Mr Barr told ABC radio ahead of Wednesday's hearing.
He said the issue at hand dated back to the days before self-government, when "a poor decision" was made to have Calvary operate a public hospital in the ACT.