46. Prima facie, a grant of power to a court (including the conferral of jurisdiction) should not be construed as subject to a limitation not appearing in the words of that grant. Rather it should be construed in accordance with ordinary principles and the words used given their full meaning unless there is something to indicate to the contrary. It is inherent in the conferral of such a power that it must be exercised judicially and in accordance with legal principle, thus warranting “the most liberal construction” of the power because such a requirement would exclude the possibility that the power might be exercised “arbitrarily or capriciously or to work oppression or abuse”: Knight v FP Special Assets Ltd  HCA 28; (1992) 174 CLR 178 (at 205) per Gaudron J; see also (at 190 – 192) per Mason CJ and Deane J; Patton v Buchanan Borehole Collieries Pty Ltd  HCA 23; (1993) 178 CLR 14 (at 17) per Mason CJ, Deane and Dawson JJ; (at 27 – 29) per McHugh J. In language reminiscent of Dixon J’s statement in Water Conservation & Irrigation Commission (NSW) v Browning , Gaudron J has said that a broad judicial discretion is properly confined by identification of the matters which are extraneous to the power and the exposition of those which are relevant to the power and the way in which they bear on its exercise: Patton v Buchanan Borehole Collieries Pty Ltd (at 23).
47. Nothing in the decisions referred to in the previous paragraph means that a conferral of jurisdiction and power is “totally uncontrolled simply because the repository of the power [is] a court”: PMT Partners Pty Ltd (In Liq) v Australian National Parks and Wildlife Service  HCA 36; (1995) 184 CLR 301 (at 313) per Brennan CJ, Gaudron and McHugh JJ; Pelechowski v Registrar, Court of Appeal (NSW)  HCA 19; (1999) 198 CLR 435 (at ) per Gaudron, Gummow and Callinan JJ; Ascot Investments Pty Ltd v Harper  HCA 1; (1981) 148 CLR 337 (at 354) per Gibbs J (Stephen J agreeing). It is “[t]he words of the grant [which] chart the ultimate boundaries of the power”: Gerlach v Clifton Bricks Pty Ltd  HCA 22; (2002) 209 CLR 478 (at ) per Kirby and Callinan JJ. There may be occasions when it is appropriate to approach the question of the proper meaning of the grant of power on the basis that only the clearest express intention can displace fundamental legal principle or basic policy consideration: FAI General Insurance Co Ltd v Southern Cross Exploration NL  HCA 13; (1988) 165 CLR 268 (at 290) p er Gaudron J.
48. The ambit of the s 21 power must be determined in the context of the adversarial system of justice in which civil proceedings in this country are conducted. In that system “choice rests primarily with the parties and it is generally the case that the courts’ power of decision or order is exercised upon the application of a party “: Berowra Holdings Pty Ltd v Gordon  HCA 32; (2006) 225 CLR 364 (at ) per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ. As Jervis CJ said in Macdougall v Paterson (1851) 11 CB 755 (at 773); (1851) 138 ER 672 (at 679), speaking of a power conferred by the County Courts Extension Act 13 & 14 Vict. c 61:
“[W]hen a statute confers an authority to do a judicial act in certain cases, it is imperative for those so authorized, to exercise the authority when the case arises, and its exercise is duly applied for by a party interested, and having the right to make the application.”
49One of the cardinal principles of the adversarial system of justice is that a judge tries the case before him or her on the evidence and arguments presented in open court by the parties or their legal representatives and by reference to those matters alone, unless Parliament otherwise provides. This principle reflects a central element in the system of justice administered by Australian courts, that is that it should be fair, meaning that it must be open, impartial and even-handed: Re JRL; Ex parte CJL  HCA 39; (1986) 161 CLR 342 (at 350) per Mason J; see also Gipp v R  HCA 21; (1998) 194 CLR 106 (at ) per McHugh and Hayne JJ. It is not the role of a judge to create a controversy: Sharp v Rangott  FCAFC 45; (2008) 167 FCR 225 (at ) per Besanko J.
50The exercise of the s 21 discretion must be made in the circumstance that once the appellants exercised the s 21 entitlement to elect for the proceedings to be tried by a jury, they had a vested or accrued substantive right: see generally Esber v The Commonwealth HCA 20; (1992) 174 CLR 430 (at 440 – 441); Western Australian Planning Commission v Temwood Holdings Pty Ltd  HCA 63; (2004) 221 CLR 30 (at ) per McHugh J; Pambula (at 412) per Samuels JA.