Interactions with Parliament
The Sovereignty of Parliament allows Parliament to override anything the courts decide, if it is enacted. Parliament is the sovereign law making body, mandated by the Constitution and the people to make laws. The only time where the High Court has power over Parliament is in constitutional cases.
E.g. the decision in Australian Communist Party v Commonwealth (1951) overruled the Communist Party Dissolution Act (1950) as it was unconstitutional. Menzies could not do anything about it, except hold a referendum to change the Constitution. He did, but it narrowly failed (3 states voted for, with an overall minority of 1% for).
Otherwise, Parliament can do 3 things about the judiciary’s interpretations:
The Parliament accepts the new common law principle and does nothing else.
E.g. Donoghue v Stevenson (1932) and Grant v Australian Knitting Mills (1936). Parliament accepted these principles of negligence.
Accept it and Legislate
Accept the court’s decision and endorses it by enacting legislation. Consider Mabo v Queensland (1992) and the Native Title Act (1993). When the High Court overturned terra nullius and supported native title and Aboriginal land rights, parliament stepped in to legislate for a process and conditions of claiming land (non-freehold and non-recreational land).
Also Wik v Queensland (1996), where the question was raised over whether land under pastoral leases could be claimed (4-3 that both claims coexist, but pastoral leases have first preference.) Resulted in the enactment of the Native Title Amendment Act (1998).
Overrule the Court
If the Parliament thinks that the court decision is wrong and outdated, they may pass legislation overturning the precedent. However, this only acts in the future; it cannot change any decisions in the past. An example of this is the SGIC v Trigwell (1979) decision to uphold the common law that farmers do not owe a duty of care to people wronged by animals straying from fields. The Wrongs (Animals Straying on Highways) Act (1984) rectified this, and made the owner liable.