Actors & Announcers Equity Association of Australia v Fontana Films Pty Ltd

An order has been made removing into this Court so much of a cause pending in the Federal Court as involves the validity of s. 45D of the Trade Practices Act 1974 Cth, as amended, ("the Act").

Fontana Films Pty. Limited ("Fontana"), a company which carried on business as a producer of motion picture films, made application to the Federal Court for an injunction in the following terms:

An order restraining the Respondents and each of them, by themselves and by their respective servants and agents, from engaging in conduct, in concert with any person, that hinders or prevents the supply of actors and other artistes, and the services of such actors and other artistes, by any theatrical agents to the applicant, where such conduct is engaged in for the purpose, and would have or be likely to have the effect of causing substantial loss or damage to the business of the applicant as a producer of motion picture films. The respondents were Actors and Announcers Equity Association of Australia, a trade union registered under the Trade Union Act 1881 N.S.W. (the first respondent, to which it will be convenient to refer as "the union"), Uri Windt and Janette Paramore, officers of the Union (the second respondents) and certain other persons. An application was made to McGregor J. for an interlocutory injunction. The facts upon which Fontana relied in support of the application were, shortly stated, as follows. Fontana did not employ actors or artistes on its permanent staff, but it would obtain through a theatrical agency the services of such actors and artistes as it needed for the purposes of a particular production. In October 1980, when Fontana was preparing for the production of a motion picture film, "The Brothers Zak", a demand was made upon it by the respondents that it should enter into an agreement which would have in effect prevented it from employing actors or artistes who were not members of the union and which would have provided for payment of what are known as residual fees to performers employed. When Fontana refused to sign the agreement, the union declared its operations "black" and in consequence of pressure exerted by the union upon the theatrical agents Fontana was unable to obtain the services of actors and artistes and was obliged to cease production of all of its projected films. McGregor J. held that the evidence prima facie established that the first respondent in concert with the second respondents engaged in conduct that has hindered and prevented the supply of services by theatrical agents to the applicant, a corporation, and that the conduct was engaged in for the purpose and would have, and be likely to have, the effect, in respect of the applicant, referred to in s. 45D(1)(b)(i) of the Act; the judgment refers to s. 45D(1)(b)(ii) but this was obviously a typographical error. It appears that in making his finding against the union he relied not only on the evidence, but also on the deeming provisions of s. 45D(5). He ordered, inter alia, as follows: That the first Respondent, its servants and agents and the second Respondents and each of them be restrained until the determination of the proceedings herein or further order from engaging in conduct in concert with each other or with any other person that hinders or prevents the supply to the applicant by: -

(a) Actors and other artistes of their services; and

(b) Any theatrical agent of the services of any actors or other artistes,

where such conduct is engaged in for the purposes and would have or be likely to have the effect of causing substantial loss or damage to the business of the applicant as a producer of motion pictures and other films. The provisions of s. 45D(1) of the Act are as follows: Subject to this section, a person shall not, in concert with a second person, engage in conduct that hinders or prevents the supply of goods or services by a third person to a fourth person (not being an employer of the first-mentioned person), or the acquisition of goods or services by a third person from a fourth person (not being an employer of the first-mentioned person), where -

(a) the third person is, and the fourth person is not, a corporation and -

(i) the conduct would have or be likely to have the effect of causing -

(A) substantial loss or damage to the business of the third person or of a body corporate that is related to that person; or

(B) a substantial lessening of competition in any market in which the third person or a body corporate that is related to that person supplies or acquires goods or services; and

(ii) the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(A) substantial loss or damage to the business of the fourth person; or

(B) a substantial lessening of competition in any market in which the fourth person acquires goods or services; or

(b) the fourth person is a corporation and the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(i) substantial loss or damage to the business of the fourth person or of a body corporate that is related to that person; or

(ii) a substantial lessening of competition in any market in which the fourth person or a body corporate that is related to that person supplies or acquires goods or services.

Section 45D(2) provides, inter alia, that a person shall be deemed to engage in conduct for a purpose mentioned in sub-s. (1) if he engages in that conduct for purposes that include that purpose. Sub-section (3) of s. 45Dexcludes the operation of sub-s. (1) when the dominant purpose for which the conduct is engaged in is substantially related to certain matters concerning the employment, or the termination of the employment, of the person concerned; since the sub-section does not call for consideration in the present case it is unnecessary to state its effect more precisely. Section 45D(5) provides as follows: If two or more persons (in this sub-section referred to as the "participants") each of whom is a member or officer of the same organization of employees (being an organization that exists or is carried on for the purpose, or for purposes that include the purpose, of furthering the interests of its members in relation to their employment) engage in conduct in concert with one another, whether or not the conduct is also engaged in in concert with other persons, the organization shall be deemed for the purposes of this Act to engage in that conduct in concert with the participants, and so to engage in that conduct for the purpose or purposes for which that conduct is enaged in by the participants, unless the organization establishes that it took all reasonable steps to prevent the participants from engaging in that conduct. By s. 45D(6) it is provided that where an organization of employees engages, "or is deemed by sub-section (5) to engage", in conduct in concert with members or officers of the organization in contravention, inter alia, of sub-s. (1), certain consequences shall follow, including -

(a) Any loss or damage suffered by a person as a result of the conduct shall be deemed to have been caused by the conduct of the organization.

The expression "corporation" is defined in s. 4(1) of the Act as follows: "corporation" means a body corporate that -

(b) is a trading corporation formed within the limits of Australia or is a financial corporation so formed;

(d) is the holding company of a body corporate of a kind referred to in paragraph (a), (b) or (c).

The expressions "financial corporation", "foreign corporation" and "trading corporation" are also defined in s. 4(1) to have the meanings they respectively have in par. 51(xx) of the Constitution, with, in the case of the first and second of those expressions, extended meanings irrelevant for present purposes. Section 4(5) provides that the express references in the Act to corporations and bodies corporate shall not be taken to imply that references to persons do not also include references to persons who are not natural persons. This sub-section, read together with s. 22(a) of theActs Interpretation Act, makes it clear that generally speaking "person" in the Act includes corporations.

(a) is the holding company of another body corporate;

(c) is a subsidiary of the holding company of another body corporate,

that first-mentioned body corporate and that other body corporate shall, for the purposes of this Act, be deemed to be related to each other. The meaning of "holding company" and "subsidiary" appear from s. 4A(1),(2),(3) and (4); a company that is a subsidiary of a subsidiary company is itself a subsidiary of the holding company of the subsidiary company. Section 80 empowers the Federal Court to grant an injuction restraining a person from engaging in conduct that constitutes or would constitute a contravention of, inter alia, s. 45D(1), and by s. 82 a person who suffers loss or damage by conduct of another person that was done in contravention of, inter alia, s. 45D(1) may recover the amount of the loss or damage by action against that other person or against any person involved in the contravention.

The condensed words of s. 45D(1) create no fewer than twelve different offences, or twenty-four, if an offence which involves a related body corporate is regarded as different from an offence which involves the corporation to which the relationship exists. It was suggested on behalf of the union that if the evidence revealed prima facie a contravention of any provision of s. 45D, it was a contravention of s. 45D(1)(a). That submission was based on evidence which showed that in the case of some productions (including the production of "The Brothers Zak") the actors, although chosen and casted by Fontana, would enter into a contract with, and be paid by, the person for whom Fontana was producing the film - in the case of "The Brothers Zak", a group of investors represented by one Clarke. In these circumstances, it was submitted that the union's case must be that the conduct of the respondents hindered or prevented the supply of films by Fontana to Clarke. The reason for making these submissions was, no doubt, that the constitutional validity of s. 45D(1)(a) appears more doubtful than does that of s. 45D(1)(b). However, it appears clearly from the form of the application, the judgment of McGregor J. and the order made that from beginning to end the case was treated as falling within s. 45D(1)(b)(i). The conduct alleged in the present case could not fall within s. 45D(1)(a), because it was alleged (and found prima facie) to be conduct that was engaged in for the purpose, and that would have or be likely to have the effect, of causing substantial loss or damage to the business of Fontana, and it was never alleged or suggested that it was any purpose of the respondents to damage the business of Clarke or any other person for whom Fontana was producing films. In fact it is clear that the case presented by Fontana was that Fontana was "the fourth person" within s. 45D(1). Under s. 45D(1)(a), "the fourth person" is not a corporation, but under s. 45D(1)(b) "the fourth person" is a corporation, and the case has proceeded on the unchallenged assumption that Fontana is a trading corporation.

All of the provisions of s. 45D(1) are intended to forbid persons from engaging in "secondary boycotts". But although all the parts of the sub-section are designed to achieve the same object, the prohibitions which the section expresses are separate and distinct. None is dependent on another. The operation of par. (b) will be unaffected if par. (a) is held to be beyond power. With the aid of s. 15A of the Acts Interpretation Act, s. 45D(1) may be given a divisible construction; one of its parts may remain effective, although the others fail. It is therefore unnecessary to consider the validity of any part of s. 45D(1) other than sub-par. (b)(i).

The only source of power upon which the Commonwealth places reliance to support s. 45D(1)(b)(i) is s. 51(xx) of the Constitution. The question is whether the provision in question is a law with respect to "Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth". The effect of the provision now in question is to forbid one person, in concert with another, to engage in conduct that hinders or prevents the supply of goods or services by a third person to a corporation, or the acquisition of goods or services by a third person from a corporation, where the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing substantial loss or damage to the business of the corporation, or of a body corporate that is related to the corporation. The definition of corporation in s. 4 of the Act requires corporation in s. 45D(1) to be understood as including not only the three sorts of corporations mentioned in s. 51(xx) and corporations incorporated in a Territory (which would be subject to the power conferred by s. 122 of the Constitution), but also the holding company of any such corporation. The effect of s. 4A(5) is that the expression "body corporate that is related to that person" in s. 45D(1)(b)(i) includes the holding company, a subsidiary, and a subsidiary of the holding company, of the corporation which is "the fourth person" within the meaning of the provision. It is a question whether s. 4A(5) and par. (d) of the definition of corporation would make the connexion between the legislation in its relation to the holding company or other related company on the one hand, and a corporation of the kind mentioned in s. 51(xx) on the other, too remote. However, both the definition of corporation in s. 4 of the Act, and s. 45D(1)(b)(i) itself, are severable. One may omit par. (d) from that definition, and omit the words "or of a body corporate that is related to that person" from s. 45D(1)(b)(i), without in any way altering the effect of the words that remain, and if the inclusion of that paragraph or of those words would render the provisions of s. 45D(1)(b)(i) invalid, s. 15A of the Acts Interpretation Act will require the words referring to related bodies corporate to be severed from s. 45D(1)(b)(i). I therefore need not consider whether the provision in question is valid in its application to conduct engaged in for the purpose of causing loss or damage to the business of a holding company or other related body corporate. Moreover, since no question of foreign corporations or financial corporations arises in the present case, it is sufficient to consider the validity of the provision in its relation to trading corporations formed within the limits of the Commonwealth.

Section 45D(1)(b)(i) imposes no obligation on a corporation. Its command is directed to persons who need not be corporations. However, what is forbidden is conduct that hinders or prevents the supply of goods or services by a third person to a corporation, or the acquisition of goods or services by a third person from a corporation. The conduct is forbidden only if it is engaged in for the purpose of causing substantial loss or damage to the business of a corporation, and if it would have or be likely to have that effect. The section protects a corporation from certain conduct which is intended and likely to cause substantial loss or damage to its business.

The limits of the power granted by s. 51(xx) have not yet been defined. That paragraph of the Constitution presents considerable difficulties of interpretation. In the first place, the power is conferred by reference to persons. Paragraph (xix), in so far as it refers to aliens, and par. (xxvi) are the only other paragraphs of s. 51 which confer power in that way. Paragraph (xxvi) stands in a special position, for it proceeds on the assumption that special laws may be deemed necessary for the people of a particular race. However, having regard to the federal nature of the Constitution, it is difficult to suppose that the powers conferred by pars. (xix) and (xx) were intended to extend to the enactment of a complete code of laws, on all subjects, applicable to the persons named in those paragraphs. It is unlikely, for example, that it was intended that the Parliament might provide that the rights and duties of aliens should be determined by a special law, different from that which applies to Australian citizens, in relation to such matters as contracts, torts, succession and criminal responsibility. Similarly, in the case of the corporations described in s. 51(xx), extraordinary consequences would result if the Parliament had power to make any kind of law on any subject affecting such corporations. Some striking examples were given by Higgins J. in Huddart, Parker & Co. Pty. Ltd. v. Moorehead [1] , although, as Higgins J. pointed out, the argument of inconvenience suggested by these extraordinary consequences was not conclusive. Other difficulties in relation to s. 51(xx) are caused by the need to construe the Constitution as a whole, and thus to reconcile par. (xx) with other parts of s. 51: see Bank of N.S.W. v. The Commonwealth [2] and Strickland v. Rocla Concrete Pipes Ltd. [3] , per Menzies J. However, it is unnecessary, and undesirable, to attempt in the present case to define the outer limits of the power conferred by s. 51 (xx). The method which the courts have followed in the past, of approaching the solution of the difficult problems presented by such a provision as s. 51 (xx) gradually and with caution, proceeding no further at any time than the needs of the particular case require, is the most likely, in the end, to achieve the proper reconciliation between the apparent width of s. 51(xx) and the maintenance of the federal balance which the Constitution requires. The authorities in which s. 51 (xx) has been considered are opposed to the view that a law comes within the power simply because it happens to apply to corporations of the kind described in that paragraph. The descriptive adjectives, "foreign", "trading" and "financial" are important. In Huddart, Parker & Co. Pty. Ltd. v. Moorehead [4] , Isaacs J. said:

Just as their incorporation distinguishes them from natural individuals, so their trading or financial capacities distinguish them from other corporations, and it is as necessary to give effect to the words "trading" and "financial" as to the word "corporation". The words of par. (xx) suggest that the nature of the corporation to which the laws relate must be significant as an element in the nature or character of the laws, if they are to be valid: cf. per Walsh J. in Strickland v. Rocla Concrete Pipes Ltd. [5] . In other words, in the case of trading and financial corporations, laws which relate to their trading and financial activities will be within the power. This does not mean that a law under s. 51 (xx) may apply only to the foreign activities of a foreign corporation, for ex hypothesi the law will be one for the peace, order and good government of the Commonwealth. It means that the fact that the corporation is a foreign corporation should be significant in the way in which the law relates to it. For present purposes, however, it is enough that it is established by Strickland v. Rocla Concrete Pipes Ltd. that a law which governs the trading activities of trading corporations formed within the limits of the Commonwealth is within the scope of s. 51 (xx): see especially at pp. 490, 508, 525. Of course, the law in the present case does not regulate or govern the activities of trading corporations; it regulates the conduct of others. But the conduct to which the law is directed is conduct designed to cause, and likely to cause, substantial loss or damage to the business of a trading corporation formed within the limits of the Commonwealth. I can see no reason in principle why such a law should necessarily fall outside the scope of s. 51 (xx). A law may be one with respect to a trading corporation, although it casts obligations upon a person other than a trading corporation. An example is provided by s. 5 of the Crimes Act 1914 Cth, as amended, considered in Reg. v. Australian Industrial Court; Ex parte C.L.M. Holdings Pty. Ltd. [6] . A law will fall within the power if the conduct to which it is directed is so relevant to the subject of the power that a law rendering such conduct unlawful can be described as a law with respect to that subject. Decisions on other paragraphs of s. 51 furnish analogies. The power given by s. 51(i) extends to forbidding anything directly affecting interstate or overseas trade or commerce: Redfern v. Dunlop Rubber Australia Ltd [7] . The power conferred by s. 51(v) enables the Parliament to prohibit conduct sufficiently relevant to the subject of television services: Herald and Weekly Times Ltd. v. The Commonwealth [8] . It does not follow that s. 51(xx) empowers the Parliament to pass a law prohibiting any conduct that might damage a trading corporation formed within the limits of the Commonwealth. However, if the prohibition is directed to conduct that is calculated to damage the trading activities of the trading corporation there seems no reason to doubt that it is within the scope of the power. 1. (1909) 8 C.L.R. 330, at pp. 409-410. 2. (1948) 76 C.L.R. 1, at pp. 203-204, 256, 304 and 330. 3. (1971) 124 C.L.R. 468, at pp. 507-508. 4. (1909) 8 C.L.R., at p. 397. 5. (1971) 124 C.L.R., at p. 519. 6. (1977) 136 C.L.R. 235, at pp. 246-247. 7. (1964) 110 C.L.R. 194, at pp. 219-220. 8. (1966) 115 C.L.R. 418, at p. 433.

In the attack made by counsel on the validity of the provision, considerable stress was laid on the fact that it appears from the provisions of s. 45D(1), viewed as a whole, that the object of the legislation is to prevent persons from engaging in secondary boycotts. In deciding whether a law is within Commonwealth power it is not permissible to attempt to discover the motives with which the law was enacted. It is necessary to consider what legal operation the law will have, if valid, and if the law has an actual and immediate operation within a field of Commonwealth power, it will be valid notwithstanding that it has another purpose which could not be achieved directly by the exercise of Commonwealth power: see Melbourne Corporation v. The Commonwealth [9] ; Fairfax v. Federal Commissioner of Taxation [10] . As has been shown, the direct legal operation of s. 45D(1)(b)(i), in its relation to trading corporations, is to prohibit persons, acting in concert, from engaging in conduct that would hinder or prevent the supply of goods or services by some other person to a trading corporation, or the acquisition of goods or services by some other person from such a corporation, when the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing substantial loss or damage to the business of the corporation. It was submitted that the use of the word "business" takes the provision outside the power. "Business" may have a larger meaning than "trade" (Smith v. Anderson [11] ) and may, it was said, extend to anything the corporation does, whether or not in the way of trade. Moreover, it was submitted, the supply of goods and services to a trading corporation, or the acquisition of goods or services from a trading corporation, may take place in the course of business but otherwise than in the course of trade, as, for example, when a trading corporation buys the stationery which it needs for its office. Accordingly, it was said, the protection given by s. 45D(1)(b)(i) is not limited to the trading activities of the corporation, and the provision is not sufficiently relevant to the head of power. It may be accepted that the words "business" and "trade" are not identical in meaning: see Hornsby Shire Council v. Salmar Holdings Pty. Ltd [12] . However, both are wide and general words, and they are not necessarily mutually exclusive in meaning: see Hornsby Shire Council v. Salmar Holdings Pty. Ltd. [13] . In Strickland v. Rocla Concrete Pipes Ltd., Menzies J. appears to have used the terms interchangeably. He said that "a law relating to the trading of trading corporations formed within Australia" is prima facie within power [14] , and later said that "a law governing the conduct of its business by a trading corporation formed within the limits of the Commonwealth is within the power of the Parliament by virtue of s. 51(xx)" [15] . In my opinion, the fact that the provision in question refers to "business" rather than "trade" does not take it outside the power. It is the business of a trading corporation to trade, and its business is its trading. In any case, one could hardly cause substantial loss or damage to the business of a trading corporation without damaging the trading corporation in its trading activities. It would be "narrow or pedantic" (to use the words of Barwick C.J. in Strickland v. Rocla Concrete Pipes Ltd. [16] ) to view the provision now in question as other than a law for the protection of the trading activities of a trading corporation formed within the limits of the Commonwealth. I consider that s. 45D(1)(b)(i) directly operates on the subject matter of the power given by s. 51(xx).

1. (1947) 74 C.L.R. 31, at p. 79. 2. (1965) 114 C.L.R. 1, at p 13. 3. (1880) 15 Ch.D. 247, at p. 259. 4. (1972) 126 C.L.R. 52, at pp. 54, 56. 5. (1972) 126 C.L.R., at p. 60. 6. (1971) 124 C.L.R., at p. 508. 7. (1971) 124 C.L.R., at p. 511. 8. (1971) 124 C.L.R., at p. 490.

I would therefore hold that s. 45D(1)(b)(i) is a valid law in its application to trading corporations formed within the limits of the Commonwealth.

The remaining question is whether s. 45D(5) is valid. It should be observed that although that sub-section refers to organizations, that word is not defined as having the meaning which it is given by the Conciliation and Arbitration Act 1904 Cth, as amended. In the present case it was not proved that the union was an organization registered under the Conciliation and Arbitration Act, and the learned Solicitor-General for the Commonwealth did not attempt to sustain the validity of s. 45D(5) under s. 51(xxxv). The sub-section was sought to be sustained only as an exercise of the power conferred by s. 51(xx). The effect of s. 45D(5) is that in certain circumstances an organization may be deemed, contrary to the proved facts, to have engaged in conduct in concert with others, for the purpose for which the actual participants engaged in that conduct. It would not be enough for the organization to prove that it did not engage in that conduct and did not have that purpose, if it could not also prove that it took all reasonable steps to prevent the participants from engaging in that conduct. In some circumstances, therefore, an organization might he liable to have orders for an injunction and damages made against it, although it had not, by itself or its agents, engaged in the proscribed conduct. The sub-section does more than merely change the onus of proof. It provides that the burden of proof may be discharged only in a particular way. If the fact to be proved is a "jurisdictional fact" - a fact which must exist if federal power is to be attracted - the question whether s. 45D(5) is valid involves the question with both Mason J. and myself left open in Milicevic v. Campbell [17] .

It is a fundamental principle that "the Parliament cannot turn a law which is not upon a subject matter of legislative power into a law which is upon such a subject matter by the simple expedient of creating a statutory fiction": Herald and Weekly Times Ltd. v. The Commonwealth [18] . It "may not, by enacting legislation which purports to be merely procedural, extend the operation of its laws to subjects beyond its power": Milicevic v. Campbell [19] . For example, the Parliament could not take upon itself power to deal with persons not immigrants simply by declaring them to be immigrants (Williamson v. Ah On [20] ); its power to make laws with respect to lighthouses would not enable it to make laws with respect to things (not in truth lighthouses) which, in the opinion of the Governor-General, were lighthouses (Australian Communist Party v. The Commonwealth [21] ); it could not empower a Commissioner to determine an intrastate dispute by making a finding that it was an interstate dispute (Reg. v. Portus; Ex parte McNeil [22] ). However, the Parliament can place on a person said to be affected by a law the onus of proving that the constitutional fact does not exist. It was so held in Williamson v. Ah On. But the majority in that case went further, and upheld the validity of a provision that precluded the person affected from discharging the burden of proof except in a particular specified way. The matter which the defendant was there required to disprove was that he was "an immigrant who has evaded an officer ", and the statute provided that the defendant could not discharge his burden of proof unless in his personal evidence he stated truly the name of the vessel by which he travelled to Australia and the date and place of his arrival in the Commonwealth. Some of the judgments in that case do not very clearly distinguish between the two questions in the case - the validity of the provision reversing the onus and that of the provision requiring the onus to be discharged in a particular way. The latter question is most distinctly dealt with by Isaacs J. and Rich and Starke JJ. Isaacs J. appears to have been of the opinion that a provision that the non-existence of a jurisdictional fact might be proved only in a certain way would be invalid only if it were "so flagrantly destructive of any real and reasonable chance to place the real facts before the Court" as to be "a mere disguise for extending the legislative power" [23] . Rich and Starke JJ. said that although some persons might not know, or might have forgotten, the facts which were required to be stated (and thus, it may be assumed, would be unable to prove the true facts), that went only to the wisdom, fairness and justice of the law and not to its competency [24] . However, it seems to me unnecessary in this case, at it was in Milicevic v. Campbell, to consider the correctness of Williamson v. Ah On in so far as it related to the statutory provision which required the burden of disproof of the existence of a jurisdictional fact to be discharged in a particular way. For in my opinion s. 45D(5) does not relate to the proof of jurisdictional facts.

1. (1966) 115 C.L.R., at p. 438. 2. (1975) 132 C.L.R., at p. 316. 3. (1926) 39 C.L.R. 95, at p. 126. 4. (1951) 83 C.L.R. 1, at p. 258. 5. (1961) 105 C.L.R. 537, at pp. 540-541. 6. (1926) 39 C.L.R., at p. 117. 7. (1926) 39 C.L.R., at p. 129.

It would, of course, be a jurisdictional fact that a company which it was sought to treat as "the fourth person" to attract the operation of s. 45D(1)(b)(i) was a corporation of the kind described in s. 51(xx). The provisions of s. 45D(1)(b)(i) could not validly be extended to persons who engaged in a boycott of a company which was not a trading corporation by deeming the company to be a trading corporation. Section 45D(5) renders the provisions of s. 45D(1) applicable to an organization which in fact has not engaged in any conduct for the purpose or with the effect of causing loss or damage to any corporation, but it does so only if the organization does not establish that it took all reasonable steps to prevent the participants in the conduct from engaging in it. The fact that conduct has been engaged in for the purpose and with the likely effect of causing substantial loss or damage to (inter alia) the trading of a trading corporation formed within the limits of the Commonwealth must be established. Then s. 45D(5) in effect renders the organization liable unless it has taken all reasonable steps to prevent the participants from engaging in that conduct, and requires the organization to discharge the onus of proving that it has done so. In my opinion this provision was reasonably incidental to the power conferred by s. 51(xx). It is true that two or more members of an organization may engage in conduct that amounts to a secondary boycott without the knowledge, or against the wishes, and even in spite of the endeavours, of those controlling the organization. But it does not follow that it is beyond the power of the Parliament to require the organization to take all reasonable steps to prevent its members from engaging in the conduct. It may be difficult to sheet home to an organization its complicity in a secondary boycott, even when it has been the instigator, and the remedy against individual members may prove ineffectual. The object of s. 45D(1)(b)(i) being (inter alia) the protection of the trading activities of trading corporations from substantial loss or damage, it seems to me that to require an organization to take all reasonable steps to prevent its members from engaging in conduct intended and likely to cause that damage is incidental to the attainment of the object. If the Parliament has power to protect the trading activities of the trading corporation, it is for Parliament to decide what measures of protection it will adopt. The wisdom or fairness of those measures is not a matter for the Court.

I need refer only to two cases in support of this conclusion. In Orient Steam Navigation Co. Ltd. v. Gleeson [25] it was held that under the immigration power the Parliament could impose upon a ship's agent an absolute liability to a penalty upon the entry of an immigrant from the ship - that is, it could impose a penalty on an agent who had been guilty of no act or omission connected with the illegal immigration. Dixon J. said [26] :

In my opinion the power of the Parliament to make laws with respect to immigration does enable it to impose upon the ship's agent who is authorized on its behalf to perform the duties imposed by laws in force in the port, an absolute liability to a penalty upon entry of an immigrant from the vessel. Such a provision is directed to promoting in those who control the ship, or who may affect its control, care to prevent entry of persons from the ship as immigrants; and is therefore a law with respect to immigration. The Court did not there discuss the principle that a power given by s. 51 includes within itself all that is necessary for its reasonable fulfilment, but the case does seem to me to provide an illustration of that principle. Whether or not that is a correct view, the decision is in my opinion of direct assistance in the present case, for it shows that a power given by a paragraph of s. 51 is wide enough to enable the Parliament to impose penalties on persons who fail to take care to prevent breaches of laws made in exercise of the power. In Burton v. Honan [27] the nature of the incidental power was expressly discussed. That was a case in which a section of the Customs Act 1901 Cth, as amended, provided for the forfeiture of goods imported in contravention of the Act, notwithstanding that they had been released by Customs for home consumption and had passed through the hands of a number of persons who had dealt with them quite honestly and had acquired apparent title bona fide and for value [28] . Dixon C.J. said [29] : These matters of incidental powers are largely questions of degree, but in considering them we must not lose sight of the fact that once the subject matter is fairly within the province of the Federal legislature the justice and wisdom of the provisions which it makes in the exercise of its powers are matters entirely for the Legislature and not for the Judiciary. These remarks are equally applicable whether the incidental power is that included in the power itself, or that conferred by s. 51 (xxxix). 1. (1931) 44 C.L.R. 254. 2. (1931) 44 C.L.R., at p. 261. 3. (1952) 86 C.L.R. 169. 4. (1952) 86 C.L.R., at p. 178. 5. (1952) 86 C.L.R., at p. 179.

Once it is accepted that s. 45D(5) has nothing to say about the proof of the jurisdictional fact, but is designed to ensure that organizations take reasonable steps to prevent their members from engaging in conduct calculated to cause substantial damage to corporations within s. 51(xx), there can be no doubt as to the validity of that part of the provision which casts upon the organization the onus of proving that it took the reasonable steps.

For these reasons in my opinion s. 45D(5) is valid. If that is so, s. 45D(6) is also valid. I would declare that s. 45D(1)(b)(i), s. 45D(5) and s. 45D(6) are valid in their application to trading corporations formed within the limits of the Commonwealth.

This case is concerned with a secondary boycott found to have been engaged in by a trade union and certain of its officers. Section 45D of the Trade Practices Act 1974 Cth deals with such boycotts. From proceedings successfully brought under that section against the union and its officers an appeal has been taken to the Full Court of the Federal Court of Australia. What is now before this Court is so much of that pending appeal as involves the validity of s. 45D.

The judgment of the primary judge discloses that only one of the numerous provisions of s. 45D is now directly is point, namely that contained in sub-s. (1)(b)(i). Its text appears in other judgments. Its effect is to prohibit two or more persons from engaging in concert in conduct that hinders or prevents the supply or acquisition by a corporation of goods or services from a third person if the conduct is for the purpose, and would have or be likely to have the effect, of causing substantial loss or damage to the business of the corporation or of a corporate affiliate.

The short question is whether this provision is a valid law of the Commonwealth. The only source of legislative power now relied upon as supporting validity is that contained in s. 51(xx) of the Constitution, the power to legislate with respect to:

Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth.

A feature of s. 45D is the many different situations to which it is capable of applying, not so much because of the use of general language of wide application but rather because of the large number of distinct provisions of which the section is composed. This is accentuated when the various definitions and deeming provisions which the Act contains come to be applied to the section. However, the form of the section is such that many of its provisions are essentially self-contained, each having its own independent operation divorced from that of others. The provision here in question is one of these and its validity as a law of the Commonwealth will not be affected by other parts of s. 45D, not because of any application of the doctrine of severance but simply because those other parts have nothing to do with the case; they neither affect the operation of sub-s. (1)(b)(i) nor have they, in their own right, any relevant application to the facts here in question.

The law contained in s. 45D(1)(b)(i) is composed of three elements: the existence of conduct by persons in concert which impedes a dealing in goods or services; the fact that that dealing is a dealing to which those persons are not themselves parties, and the presence of resultant and intended actual or likely detriment to one of the parties to the dealing, it being a corporation. It would no doubt be possible to describe the law by reference to any one of these elements, the conduct, the dealing or the detriment suffered by a corporation, ingnoring in each instance the two other elements. The law could thus be described as one about concerted action affecting dealings, about dealings in goods or services or about detriments to corporations. But each such description would suffer from excessive width since it is only certain forms of concerted action, only dealings between those not parties to such actions and only detriments of a particular kind, suffered by a corporation, that the law affects. Its true character can only be conveyed by a description which picks up each of the elements, as does the description of it as a law prohibiting concerted action directed against a corporation's dealing in goods and services. Any attempt further to refine the description, while it may succeed in confining the subject matter of the law to one only of its elements, will necessarily lead to a departure from accuracy.

What I have said touches upon one of the major difficulties involved in the process of characterization. An accurate description of any at all complex law will necessarily be relatively detailed if it is to encompass the several elements which together go to make up the impugned law. However, constitutional grants of power such as those in s. 51 are customarily expressed quite differently - succinctly and in terms of wide generality. Thus, when an accurate, and hence relatively detailed, description of a law is sought to be matched against one or other of the tersely expressed grants of legislative power contained in s. 51 of the Constitution, it will not infrequently be found that different parts of the description of the law fall within different paragraphs of s. 51; still other parts may be found to fall within none of those enumerated grants of power, because they concern elements of the law which are the subject only of State legislative power.

The pattern of distribution of legislative power in Australia is not based on a concept of mutual exclusiveness. It differs from that found in Canada's British North America Act of 1867, with its two lists of mutually exclusive matters, granted, by ss. 91 and 92, to the Canadian and provincial legislatures respectively - as to which see Hogg, Constitutional Law of Canada (1977), pp. 80-87, 95-96. Because the powers granted by s. 51 are not exclusive, but instead remain available, so far at least as their subject matter permits, for exercise by the States, subject only to the terms of s. 109 in the event of inconsistency, there is not, in Australia, the same need to seek for one sole or dominant character of each law. True it is that the Commonwealth's legislative power is confined to enumerated subject matters, to be found in s. 51 and elsewhere in the Constitution. But because the States, unlike the Canadian provinces, retain wide concurrent legislative powers, the according of validity to a particular law of the Commonwealth will not, in our non-exclusive system of allocation of legislative power, deprive the States of legislative capacity concerning the general subject matter of that law; only by the operation of s. 109 may the effective operation of a State law be jeopardized.

Unaffected by restraints imposed by the existence of mutually exclusive grants of legislative power, this Court's process of characterization is free to recognize that laws may in truth possess a number of characters. Effect may thus be given to the reality to which Isaacs J. referred in Osborne v. The Commonwealth [30] , when he spoke of those lines of human affairs which "from their inherent complexity cross each other at innumerable points" and make it "impossible to frame an arbitrary classification, such as that contained in s. 51 of the Constitution, which will completely segregate the transactions of life".

It is noteworthy that in Canada the notion of sole or dominant characterization that has evolved from the scheme of the British North America Act has in the course of time been tempered by the development of a "double aspect" doctrine - see Hogg, p. 84, and Sawer, Modern Federalism (1976 ed.), p. 136. This development gives recognition to the inherent interrelation and complexity of human affairs.

To recognize that a law may possess a number of quite disparate characters is, then, to accept reality. Few laws will involve only one element. Even the simplest form of law will commonly contain two elements when it forbids, regulates or mandates particular conduct on the part of a particular class of person. The conduct and the class will form distinct elements and if each happens to bear a relationship to different grants of legislative power the law may often be equally appropriately described by reference to either. If a law also includes reference to another class of persons, those affected by the conduct in question, a third element will thereby be introduced. Many laws will, because of the relatively complex concepts to which they give effect, involve still further elements. These elements may, of course, all bear one and the same character. However, where they do not, any search for a single character by which to describe the law is likely to prove fruitless.

Were constitutional dogma to require such a search to be pursued, the difficulty in choosing between competing elements might readily lead different minds, perhaps influenced by quite subjective considerations, to varying conclusions as to the dominant character of a law. But to accept as constitutionally permissible the fact that a law may bear several characters, each as valid as the other because each is reasonably capable of fairly describing the law as a whole, disposes of the need to rely upon what may prove to be quite subjective reasons for selecting one particular description only. With the disappearance of subjective criteria, the process of characterization then becomes less uncertain and more a matter of logic than of idiosyncratic assertion.

Once it is recognized that a law may possess several distinct characters, it follows that the fact that only some elements in the description of a law fall within one or more of the grants of power in s. 51 or elsewhere in the Constitution will be in no way fatal to its validity. So long as the remaining elements, which do not fall within any such grant of power, are not of such significance that the law cannot fairly be described as one with respect to one or more of such grants of power then, however else it may also be described, the law will be valid. If a law enacted by the federal legislature can be fairly described both as a law with respect to a grant of power to it and as a law with respect to a matter or matters left to the States, that will suffice to support its validity as a law of the Commonwealth.

In characterizing the law represented by s. 45D(1)(b)(i) I have not had recourse to the context provided by the Act as a whole, and this not only because the law speaks for itself, bearing on its face its several characters, but also because those who attack its validity do not assert the existence of some covert character, not apparent on its face. The attack is rather designed to establish as the law's sole character one only of its overt concerns, that of secondary boycotts. Accordingly this is not a case where form and substance are to be distinguished; in this law they are at one.

That characterization does not require a search for one sole or predominant character where the law in question can be seen to possess several characters is now well established in Australian constitutional law. In Melbourne Corporation v. The Commonwealth [31] Dixon J. spoke of a law which "wears two aspects", only one being a subject of Commonwealth power. His Honour said that so long as in that aspect the law operated directly upon a matter forming an actual part of an enumerated subject matter of Commonwealth legislative power "its validity could hardly be denied on the simple ground of irrelevance to a head of power It will be held to fall within the power unless some further reason appears for excluding it. That it discloses another purpose and that the purpose lies outside the area of federal power are considerations which will not in such a case suffice to invalidate the law" [32] . In Strickland v. Rocla Concrete Pipes Ltd [33] Menzies J., after citing a passage from the judgment of Higgins J. in the early case of Huddart, Parker & Co. Pty. Ltd. v. Moorehead [34] in which Higgins J. had reasoned on the basis that a law could not be one "with respect to" more than one head of power, said [35] :

In my opinion, the dichotomy upon which his Honour based his decision can no longer be maintained. Legislation with respect to corporations may also be legislation with respect to trade. A law with respect to corporations is within the power of Parliament notwithstanding that it is also a law with respect to trade, notwithstanding the limited power in relation to trade conferred upon Parliament by s. 51(i). Similar views had earlier been expressed by Owen J. in Attorney-General (Vict.) v. The Commonwealth [36] and by Kitto J. in Herald and Weekly Times Ltd. v. The Commonwealth [37] and had been elaborated upon by Windeyer J. in Victoria v. The Commonwealth [38] ; see also per Walsh J. inWorthing v. Rowell and Muston Pty. Ltd. [39] . What would appear to be a contrary view expressed by Barwick C.J. in Victoria v. The Commonwealth [40] may perhaps be attributable to the particular circumstances of that case, in which one character of the law there impugned was that of a law with respect to the power or functions of a State. 1. (1947) 74 C.L.R. 31. 2. (1947) 74 C.L.R., at p. 79. 3. (1971) 124 C.L.R. 468. 4. (1909) 8 C.L.R. 330. 5. (1971) 124 C.L.R., at p. 510. 6. (1962) 107 C.L.R. 529, at p. 601. 7. (1966) 115 C.L.R. 418, at p. 434. 8. (1971) 122 C.L.R. 353, at pp. 400, 403-404. 9. (1970) 123 C.L.R. 89, at p. 137. 10. (1971) 122 C.L.R., at pp. 372-373.

More recent authority that valid laws of the Commonwealth may possess several characters and that the fact that one or more of such characters is not within a head of Commonwealth power will not spell invalidity is provided by Seamen's Union of Australia v. Utah Development Co. [41] , per Mason J. and by Reg. v. Sweeney; Ex parte Northwest Exports Pty. Ltd. [42] , per Gibbs C.J., per Stephen J. [43] , and per Mason J. [44] .

1. (1978) 144 C.L.R. 120, at p. 154. 2. (1981) 147 C.L.R. 259, at pp. 264-265. 3. (1981) 147 C.L.R., at pp. 266-267. 4. (1981) 147 C.L.R., at pp. 273-274.

It follows that in testing validity the task is not to single out one predominant character of a law which, because it can be said to prevail over all others, leads to the attaching to the law of one description only as truly apt. It will be enough if the law fairly answers the description of a law "with respect to" one given subject matter appearing in s. 51, regardless of whether it may equally be described as a law with respect to other subject matters. This will be so whether or not those other subject matters appear in the enumeration of heads of legislative power in s. 51.

If the task of characterization be approached in this fashion, s. 45D(1)(b)(i) may be seen clearly enough to possess the character of a law with respect to trading corporations, whatever other characters it may also possess. What it does is to forbid conduct which has for its purpose, and which in addition would have or be likely to have the effect, of causing substantial loss or damage to a corporation. To that may be added the fact that the forbidden conduct is described, in the opening words of s. 45D(1), in terms directly relating it to the trading activities of corporations. Whatever other descriptions might also be assigned to it, to fail to include as one characterization of it that of a law about corporations would seem to me to be to ignore the obvious. To describe it as a law with respect to trading corporations seems entirely apt; it does no more than recognize what is the manifest purpose and direct effect of the law. The connexion with corporations forms a crucial component of the law, making wholly inappropriate any description of that connexion as being merely "so incidental as not in truth to affect its character" - per Kitto J. in Fairfax v. Federal Commissioner of Taxation [45] .

The centrality of that connexion is emphasized, rather than diminished, by the fact that the prohibition which the law imposes is not addressed to corporations but rather to those who act with a purpose of harming them. That the law takes this form is dictated by its aim of protecting corporations from a particular harm; in such a prohibitory law the focus will necessarily be upon the acts of those who intend harm. A law forbidding certain acts of third parties for the reason that they were both intended, and also likely, to harm aliens would surely be as central to the grant of power with respect to aliens as a law which required aliens to do or refrain from particular conduct: the intended object of another's conduct is no less central, no less significant, in bestowing a character upon a law than is the actor to whom that law directly speaks.

I should now refer briefly to certain specific criticisms of the legislation. Attention was drawn to the definition of corporation in s. 4. To the extent to which it extends to holding corporations it is no doubt in excess of power, such corporations may not possess any of the qualities of "constitutional" corporations; but this offending part of the definition is clearly severable. The same may be said of the reference to "a body corporate that is related to" a trading corporation in par. (i) of s. 45D(1)(b). It too would seem to be in excess of power but again is readily severable. The facts of this case do not involve reliance upon either of these provisions; accordingly, to sever them, leaving standing what is valid, will in no way affect the relevant operation of s. 45D(1)(b)(i). It follows that these criticisms of the legislation do not advance the appellants' case.

It was also contended that because s. 45D(1)(b)(i) refers to substantial loss or damage to "the business" of a corporation this introduced invalidity because a corporation's "business" is capable of extending so as to include far more than its trading activities. This argument is founded upon the assumption that s. 51(xx) is confined to the trading activities of trading corporations. Even were such an assumption well-founded, the present contention would nevertheless fail because, in this sub-paragraph, "business" must clearly be given a meaning consistent with context and that requires that its meaning should be confined to a corporation's trading activities.

An argument was also raised concerning the effect of s. 45D(2); s. 45D(2) provides that the purpose described in s. 45D(1)(b)(i) may be only one of a number of purposes. In so providing it cannot, I think, bear upon the validity of sub-s. (1)(b)(i); if a purpose of causing substantial loss or damage to a corporation, coupled with at least the likelihood of such loss or damage occurring, is enough to give this prohibitory law its character as a law validly enacted under s. 51(xx), the fact that the law contemplates that those who act in concert and possess that purpose may also have other additional purposes in mind would seem itself to provide no basis for denying the law its validity.

Again it was said that sub-par. (ii) of s. 45D(1)(b) is ultra vires because, unlike sub-par. (i), it does not speak in terms of loss or damage to a corporation; instead its nexus with the corporation power is confined to the fact that the prohibited conduct causes a substantial lessening of competition in any market in which a corporation trades. I find it unnecessary to express any view of the validity of sub-par. (ii). It is enough that sub-par. (i) is a provision which operates quite independently of sub-par. (ii); only sub-par. (i) is in question in this case and whether sub-par. (ii) be valid or invalid that will not affect the validity of sub-par. (i).

The terms of sub-ss. (5) and (6) were also attacked as ultra vires. I have read and agree with all that Mason J. has written regarding these two provisions and do not desire to add anything further to what his Honour has said.

I am in agreement with the form of order which his Honour proposes, which gives effect to the conclusions which I have expressed.

There has been removed under s. 40(1) of the Judiciary Act 1903 Cth into this Court from an appeal pending in the Full Court of the Federal Court the question of the validity of s. 45D of the Trade Practices Act 1974 Cth ("the Act").

The facts may be briefly stated. The respondent produces and makes films including television commercials and documentaries. One such film is a sixty minute film called "The Brothers Zak" which it was proposed the respondent would produce for a fee of approximately $110,000. This was to be a "pilot episode" - to be exhibited to various television stations with a view to obtaining orders for the production of further films based on the characters and plot.

Before final agreement was reached for the production of the film the dispute between the parties in this matter arose and final agreement then became conditional upon the resolution of the dispute. By this time final casting had been virtually completed and the respondent had commenced production, incurring expenses in excess of $10,000 in relation thereto to the end of October 1980.

The dispute arose in this way. Some of the actors cast by the respondents were not members of the first appellant, which is a trade union registered under the Trade Union Act 1881 N.S.W.. The second appellants, the Assistant General Secretary and the Radio Film and Television Organizer of the first appellant, informed the respondent that they had sent out letters to a large number of actors' agencies, the effect of which was that no further talent would be supplied to the respondent by actors and artistes belonging to the first appellant unless the respondent agreed to give preference to members of the first appellant in the casting of "The Brothers Zak". The respondent refused to agree to this demand and a black-ban was imposed, all members of the first appellant being directed not to work on the production of "The Brothers Zak".

Production of "The Brothers Zak" has, as a consequence, been suspended. A documentary called "Continent Six" and five commercials have been similarly affected by the black-ban.

McGregor J. in the Federal Court made an order that the appellants be restrained from engaging in conduct in concert with each other or with any other person that hinders or prevents the supply of actors and artistes to the respondent. His Honour found that the terms of s. 45D of the Act were fulfilled and granted the injunction under s. 80.

The appellants appealed to the Full Court of the Federal Court. The matter was then removed into this Court on the question of the constitutional validity of s. 45D. For this reason, subject to a minor qualification, it is unnecessary to examine the correctness of the findings of fact of McGregor J.

Subject to this section, a person shall not, in concert with a second person, engage in conduct that hinders or prevents the supply of goods or services by a third person to a fourth person (not being an employer of the first-mentioned person), or the acquisition of goods or services by a third person from a fourth person (not being an employer of the first-mentioned person), where -

(a) the third person is, and the fourth person is not, a corporation and -

(i) the conduct would have or be likely to have the effect of causing -

(A) substantial loss or damage to the business of the third person or of a body corporate that is related to that person; or

(B) a substantial lessening of competition in any market in which the third person or a body corporate that is related to that person supplies or acquires goods or services; and

(ii) the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(A) substantial loss or damage to the business of the fourth person; or

(B) a substantial lessening of competition in any market in which the fourth person acquires goods or services; or

(b) the fourth person is a corporation and the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(i) substantial loss or damage to the business of the fourth person or of a body corporate that is related to that person; or

(ii) a substantial lessening of competition in any market in which the fourth person or a body corporate that is related to that person supplies or acquires goods or services.

"Corporation" is defined in s. 4(1), as are the terms "foreign corporation", "financial corporation", "trading corporation", "goods" and "services". The terms "acquire" and "supply" are also defined in s. 4(1) and are given an extended operation by s. 4C. The expression "related" body corporate is dealt with in s. 4A(5). And the words "engaging in conduct" and "conduct" are defined in s. 4(2).

For the present I need not discuss these provisions except to say that "corporation" is defined so as to mean a body corporate mentioned in s. 51(xx) of the Constitution, a body corporate incorporated in a territory or a holding company of a body corporate as defined. "Related" body corporate reaches out to pick up a holding company, a subsidiary company and an associated company which is a co-subsidiary of the same holding company. These provisions are said to take s. 45D beyond the limits of Commonwealth legislative power. Their operation may be left for later discussion in connexion with the issue of severability. For the time being we can proceed on the footing that s. 45D, when it refers to a "corporation", is referring substantially to a corporation within the meaning of s. 51(xx) and a corporation incorporated in a territory.

McGregor J. stated that the facts fell within s. 45D(1)(b)(ii). However, it was accepted in this Court that this was a typographical error and that the finding should have referred to s. 45D(1)(b)(i). His Honour's judgment made no reference to market competition. Such a reference would have been necessary to support a finding based on sub-par. (ii).

The first appellant submits that, despite the finding of McGregor J., the relevant law in this case is not s. 45D(1)(b) but s. 45D(1)(a). This contention is untenable. Paragraph (a) of sub-s. (1) is restricted to the situation where the third person is, and the fourth person is not, a corporation. On the facts of this case par. (a) can only apply if the respondent, being a corporation, is the third person and the actors and artistes or their agents are the various fourth persons. This being the case, only the aspect of sub-s. (1) which relates to the acquisition of services by a third person from a fourth person can be relevant, that aspect relating to the supply of goods or services by a third person to a fourth person not having any application. Before par. (a) can apply both sub-pars. (i) and (ii) must be satisfied, as they are expressed to be conjunctive. However, in this case sub-par. (ii) of par. (a) has no relevant operation. The conduct here by the first and second persons did not have the purpose nor the effect nor the likely effect of causing the damage referred to in cl. (A) of sub-par. (ii) to the actors and artistes or their agents. And since neither the actors and artistes nor their agents acquire goods or services in any market, cl. (B) is of no relevance.

Paragraphs (a) and (b) of s. 45D(1) are clearly severable. The wording of the two paragraphs indicates two quite distinct legislative schemes. They appear to be completely independent of one another. There is certainly no affirmative indication of interdependence in the text, context, content or subject matter of the provisions: Australian National Airways Pty. Ltd. v. The Commonwealth [46] . The legislative history of the provision supports this conclusion. Section 45D was first introduced in 1977 in a form which was basically the same as s. 45D(1)(b) in the present provision. An amendment in 1980 served in effect to insert par. (a) into the provision. The validity of s. 45D(1)(a) need not therefore be considered in this case.

The question which we have to decide, therefore, is whether s. 45D(1)(b)(i) is valid. It prohibits persons from engaging in concert in conduct that hinders or prevents the supply of goods or services by a third person to a fourth person or the acquisition of goods or services by a third person from a fourth person, where the fourth person is a corporation, and the conduct is engaged in for the purpose and would have, or be likely to have, the effect of causing substantial loss or damage to the business of the fourth person or of a related corporation.

The appellants begin by seeking to make the point that the target of the relevant prohibition is the third person (who need not be a corporation); it is the third person's supply of goods or services or his acquisition of goods or services that is protected. To so describe the provision is to mis-describe it. It protects the supply or acquisition of goods or services by the third person to or from the fourth person to the extent to which it falls within the statutory description. But sub-par. (i) makes it clear that the primary object of the provision is to protect the trading activities of the fourth person, that is, the trading activities of a corporation. The conduct described is enjoined only when its purpose and effect, broadly speaking, is to damage the business of the fourth person or of a related corporation. Where the purpose and effect of the conduct is to damage the business of the third person only, the conduct is not enjoined by sub-s. (1)(b)(i). So much for the argument that the provision is directed to the protection of non-corporations. In truth it only protects the trading activities of a non-corporation when that protection is incidental to the protection of the trading activities of a corporation - that being the primary object of the provision.

The appellants resist this analysis of the provision on the ground that we should not look at it in isolation but in the setting in which it is to be found - as an element in an entire section. When this is done, they say, s. 45D is seen to be a law dealing with secondary boycotts and a law imposing responsibility on trade unions in certain circumstances, a law which the Commonwealth Parliament has no power to enact. The reference to imposition of responsibility on trade unions is directed to sub-ss. (5) and (6), the validity of which are attacked on separate grounds. For present purposes we need not go beyond sub-s. (1), the other impugned provisions being related to it.

To describe s. 45D(1) as a law about secondary boycotts is to describe it inadequately. It is a law about secondary boycotts which have an effect, to use a neutral term, on corporations as defined in s. 4(1) of the Act. Whether all the provisions of the sub-section have a sufficient connexion with the related head of power (s. 51(xx)) is a large question. Nevertheless it is correct to say of each provision in sub-s. (1) that it prohibits boycotts against the supply or acquisition of goods or services by one person to or from another where one at least of the persons is a corporation in the defined sense. From this it follows that the prohibiting of such boycotts necessarily has an effect on corporations in their trading activities. The scheme of s. 45D(1) is complex. Paragraph (a) yields four combinations of prohibited conduct by virtue of the disjunctive relationship between cll. (A) and (B) of sub-par. (i) and between cll. (A) and (B) of sub-par. (ii) and of the conjunctive relationship between sub-pars. (i) and (ii). The consequences referred to in sub-par. (i) involve either substantial loss or damage to the business of a corporation or a related body corporate (cl. (A)) or a substantial lessening of competition in any market in which a corporation or a related body corporate supplies or acquires goods or services (cl. (B)). Although sub-par. (ii) concerns consequences to non-corporations, it actually serves to narrow the scope of operation of par. (a) by virtue of the conjunctive relationship between sub-pars. (i) and (ii). The conduct prohibited by par. (b) relates to the same consequences to corporations as those referred to in par. (a)(i), but with the additional requirement that the conduct be engaged in for the purpose of causing those consequences.

This summary serves to show that the operation of each provision has a relationship with corporations in the defined sense, the degree of the relationship ranging from the closer connexion seen in pars. (a)(i)(A) and (b)(i) to the connexion in pars. (a)(i)(B) and (b)(ii), which may involve less of an impact on the business of a corporation. But even in the latter case the boycott relates to the trading activities of a corporation or a related corporation as it must be such as to have or be likely to have the effect of causing a lessening of competition, presumably to the disadvantage of the corporation in the market in which it supplies or acquires the relevant goods or services. All this indicates an attempt to prohibit secondary boycotts which adversely affect the trading activities of corporations, rather than an endeavour to prohibit secondary boycotts generally. It is no doubt true to say that the incidental effect of s. 45D(1) is to prohibit secondary boycotts affecting other persons as well as corporations in the defined sense, so long as there is an effect or likely effect on corporations, but this falls far short of the general description of the section which the appellants seek to sustain.

Accordingly, there is nothing in the provisions of s. 45D(1) viewed as a whole which justifies us giving to s. 45D(1)(b)(i) a character different from that yielded by an analysis of its legal operation according to its terms.

The appellants rely, unavailingly as it seems to me, on the remarks of Kitto J. in Fairfax v. Federal Commissioner of Taxation [47] where his Honour, referring to s. 51(ii) of the Constitution, said:

Under that section the question is always one of subject matter, to be determined by reference solely to the operation which the enactment has if it be valid, that it to say by reference to the nature of the rights, duties, powers and privileges which it changes, regulates or abolishes; it is a question as to the true nature and character of the legislation: is it in its real substance a law upon, "with respect to", one or more of the enumerated subjects, or is there no more in it in relation to any of those subjects than an interference so incidental as not in truth to affect its character? This is to say that a law is to be characterized by reference to its direct legal operation according to its terms, not by reference to the motives which inspired the legislator or the purpose or the indirect consequences which it seeks to achieve. 1. (1965) 114 C.L.R. 1, at p. 7.

In Fairfax the Court rejected the contention that Div. 9B of the Income Tax and Social Services Contribution Assessment Act 1961 Cth, though in form a law with respect to taxation, was in reality a law with respect to investment of moneys of superannuation funds because it denied exemption from liability from income tax to the income of superannuation funds if the funds were not invested as to a prescribed proportion in public securities. The basis of the decision was that, characterized by reference to its direct legal operation, Div. 9B was a law with respect to taxation. It was not to the point that the provision might also be seen as a law dealing with the investment of moneys of superannuation funds or that it sought to effect certain consequences in relation to investment in public securities. It was enough that it had a direct legal operation on the permitted topic.

The fact that the provision dealt with the investment of moneys by superannuation funds so as to influence investment in public securities by subjecting their income to greater liability to income tax if they did not maintain a due proportion of their investments in public securities was immaterial. It was neither a reason for departing from the direct legal operation test nor a matter to be taken into account in deciding whether the section had a direct legal operation on the relevant head of power. The point emerges clearly in the judgment of Taylor J. who said [48] :

But this Court has consistently maintained that where a challenge is made to a statute on the ground that it is not a law with respect to a particular legislative subject matter it is irrelevant to consider the motives which led to its enactment or to examine the indirect consequences which may, ultimately, result from it; if it be, in substance, a law with respect to a particular subject matter the motives which influenced the legislature or the indirect consequences of the measure cannot operate to change its character. Later his Honour said [49] : The object, the purpose and the intention of an enactment made under such a power can be gathered only from an examination of what the legislature has chosen to enact and not from a consideration of extraneous matters. Unrestricted by limitations arising from the doctrine of the reserved powers of the States the power of the Commonwealth to make laws with respect to taxation stands revealed as a head of power subject to no limitations except those prescribed by the Constitution itself. The test of validity must be, therefore, whether an impugned law creates duties, obligations or liabilities which are extraneous to the power. If it does no more than impose a liability to tax it is such a law and it is not to the point to consider the motives of the legislature in enacting it or to examine the purpose which it was intended to serve. His Honour then said of the impugned Division [50] : It imposes no duties, obligations or liabilities upon trustees of superannuation funds other than an obligation to pay income tax in certain events; it imposes no obligation upon them to invest their funds in any particular fashion and no duties, obligation or liabilities which are extraneous to the power. It may be conceded that it offers a substantial inducement to trustees to invest a substantial proportion of their funds in public and Commonwealth securities but this is, by no means, sufficient to enable it to be said that it is not a law with respect to taxation. 1. (1965) 114 C.L.R., at p. 14. 2. (1965) 114 C.L.R., at p. 16. 3. (1965) 114 C.L.R., at p. 16.

In Fairfax the appellants attempted to fix Div. 9B with a character ascertained by reference to its ultimate purpose, or its indirect consequences. Here the attempt is to imbue s. 45D(1)(b)(i) with a character derived from the overall operation of the section. The answer is that the character of the impugned provision is to be ascertained by reference to its legal operation according to its terms and the effect which it has. In ascertaining that character it is relevant to have regard to other provisions in construing the terms of the provision, but once its true construction is settled upon its character is ascertained according to the legal operation which it then has.

The appellants next seek to make a further point about the operation of sub-s. (1)(b)(i). Arguing from the platform that the power conferred by s. 51(xx) of the Constitution extends only to the trading activities of trading corporations, they focus attention on the reference to loss or damage to "the business" of the fourth person, submitting that "the business" of a corporation is a concept very much wider than its trading activities. In some circumstances this may be so - see the comments of Sir George Jessel M.R. in Smith v. Anderson [51] . But here the word "business" is tied to the opening words of s. 45D(1). Those words confine the operation of the prohibition to conduct that hinders or prevents trading activities, i.e. the supply or acquisition of goods or services. Consequently, when the provision refers to loss or damage to "the business" of the fourth person, it is speaking of loss or damage to that business consequent upon, or attributable to, conduct which hinders or prevents the corporation's trading activities.

The question, then, is whether the corporations power extends to an enactment having the operation and effect which I attribute to s. 45D(1)(b)(i) on the interpretation which I have given to it. The extent of the corporations power has been the subject of continuing debate since Huddart, Parker & Co. Pty. Ltd. v. Moorehead [52] . The decision in that case may be taken to have been overruled by Strickland v. Rocla Concrete Pipes Ltd. [53] .

1. (1909) 8 C.L.R. 330. 2. (1971) 124 C.L.R. 468, esp. at pp. 489, 499, 510-511, 512-513, 515.

Strickland decided that ss. 5(1) and 8(1) of the Australian Industries Preservation Act 1906 Cth were a valid exercise of the coporations power. Section 5(1) prohibited corporations of the relevant class from entering into a contract or engaging in a combination, inter alia, with intent to destroy or injure by means of unfair competition any Australian industry the preservation of which was advantageous to the Commonwealth. Section 8(1) prohibited corporations of the same class from monopolizing or attempting to monopolize any part of trade and commerce in Australia with intent to control to the detriment of the public the supply or price of any service, merchandise or commodity. The importance of this aspect of the decision is that it upheld the validity of an exercise of the corporations power which struck at activities intended to destroy or injure Australian industry, the object of the legislation being to protect Australian industry and Australian trade and commerce, subjects over which the Commonwealth lacks complete legislative power.

The second aspect of the decision is that the Court, but for the fact that the obligation to register examinable agreements imposed by the Trade Practices Act 1965-1969 Cth was not confined to agreements whereby corporations accepted restrictions on their trading activities, would have regarded the imposition of the obligation as a valid exercise of the corporations power, notwithstanding that the obligation to register attached to persons whether corporations or not.

The judgments in Strickland, in Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [54] , and more recently in Reg. v. Federal Court of Australia; Ex parte W.A. National Football League [55] , do not attempt to define the limits of the corporations power. They proceed upon the footing that the power extends to the regulation of the trading activities of foreign corporations and trading and financial corporations formed within the limits of the Commonwealth, without deciding whether it travels further. By way of illustration I quote the remarks of Barwick C.J. in Strickland where his Honour, referring to ss. 5(1) and 8(1) of the Australian Industries Preservation Act, said [56] :

They were clearly laws regulating and controlling amongst other things the trading activities of foreign corporations and trading and financial corporations formed within the limits of the Commonwealth. In my opinion such laws were laws with respect to such corporations. They dealt with the very heart of the purpose for which the corporation was formed, for whether a trading or financial corporation, by assumption, its purpose is to trade, trade for constitutional purposes not being limited to dealings in goods. If the corporation is exercising its powers it will be carrying out trading operations and in that pursuit making agreements with others in matters of trade. Agreements to restrict trade or endeavouring to monopolize it are activities in trade with which the law has been familiar for centuries. Sections 5(1) and 8(1) in controlling such activities are in my opinion clearly laws with respect to the topic of s. 51(xx.). There the Chief Justice described the trading activities of the corporations mentioned in s. 51(xx) as constituting "the very heart of the purpose for which the corporation was formed". See also Trade Practices Commission v. Tooth & Co. Ltd. [57] . 1. (1974) 130 C.L.R. 533, esp. at pp. 542-543. 2. (1979) 143 C.L.R. 190. 3. (1971) 124 C.L.R., at p. 489. 4. (1979) 142 C.L.R. 397, at p. 433.

The appellants seek to draw a distinction between a law which regulates the trading activities of a trading corporation and a law which protects such activities. When we speak of a law which regulates the trading activities of a trading corporation we mean a law which controls the subject matter by prohibiting the corporation from engaging in certain trading activities or permitting it so to do either absolutely or subject to condition. Such a law is within power because it necessarily operates directly on the subject of the power - it is a law about trading corporations. But when we speak of a law which protects the trading activities of a trading corporation our statement is not so specific. It may be understood as signifying a law which operates directly on the subject of the power. So understood the law is within power and valid. But it may be understood in a different sense so as to denote a law which, though it protects the trading activities of trading corporations, does so by a legal operation outside the subject matter of the power. A law which prohibits the levying of taxes and duties on trading activities generally may be said to protect or promote the trading activities of corporations, but it is neither a law with respect to corporations nor a law with respect to trading corporations. It protects the trading activities of non-corporations as well as protecting the trading activities of corporations and the protection which it gives to non-corporations is not merely incidental to the protection given to corporations. The law does not operate directly upon corporations and it cannot be characterized as a law about them.

The Solicitor-General for the Commonwealth submits that if there is a power to prohibit the activities or the trading activities of trading corporations, it necessarily follows that there is a legislative power to protect these activities. He refers to the observations of Starke J. in Bank of N.S.W. v. The Commonwealth [58] , where his Honour expressed the view that the power enabled the Parliament to prohibit activities of corporations. However, his Honour said nothing about a law which protects corporations or their trading activities. The Solicitor-General's submission is correct so long as it is understood that by a law which protects the trading activities of trading corporations he means a law which has a direct legal operation on the subject of the power. Such a law is within power and valid.

The distinction made by the appellants does not avail them here. Sub-section (1)(b)(i) operates directly on the trading activities of trading corporations. It protects them by prohibiting interference with their trading activities.

It is for this reason that another distinction which the appellants seek to make does not come to their rescue. The appellants acknowledge that a law which protects interstate trade and commerce has been held to be a valid exercise of the power conferred by s. 51(i). In Airlines of N.S.W. Pty. Ltd. v. New South Wales [No. 2] [59] , it was held that where a law protects interstate trade and commerce against danger of interference, the law is itself within power because it protects the operation of an activity within s. 51(i). Similarly, in Australian Coastal Shipping Commission v. O'Reilly [60] , it was held that just as the Commonwealth had the power to create the Australian Coastal Shipping Commission under s. 51(i), it had the power "to protect the Commonwealth Government body from what may be considered the embarrassment of taxation by the various States", to use the words of Dixon C.J. [1] . Different consequences may flow according to whether the subject of legislative power is a concept consisting of transactions, such as interstate trade and commerce, or whether it is entities such as corporations, aliens or lighthouses. But these differences, whatever they may be, have no application to the validity of a law which protects the subject of a power by operating directly on it.

1. (1965) 113 C.L.R. 54, at pp. 78, 92-93, 115, 149. 2. (1962) 107 C.L.R. 46. 3. (1962) 107 C.L.R., at p. 55.

I should not wish it to be thought from what I have said that the corporations power is confined in its application to trading corporations to laws that deal with their trading activities. The subject of the power is corporations - of the kind described; the power is not expressed as one with respect to the activities of corporations, let alone activities of a particular kind or kinds. A constitutional grant of legislative power should be construed liberally and not in any narrow or pedantic fashion. This, the correct approach to the interpretation of legislative powers conferred by the Constitution, was expressed by this Court in its unanimous judgment in Reg. v. Public Vehicles Licensing Appeal Tribunal (Tas.); Ex parte Australian National Airways Pty. Ltd. [2] , in these words:

The simplest approach, however, to the problem is simply to read the paragraph and to apply it without making implications or imposing limitations which are not found in the express words. We must remember that it is part of the Constitution and go back to the general counsel to remember that it is a constitution we are construing and it should be construed with all the generality which the words used admit. See per O'Connor J. in the Jumbunna Case [3] . See also New South Wales v. The Commonwealth [4] . 1. (1964) 113 C.L.R. 207, at pp. 225-226. 2. (1908) 6 C.L.R. 309, at pp. 367, 368. 3. (1975) 135 C.L.R. 337, at pp. 470-471.

Nowhere in the Constitution is there to be found a secure footing for an implication that the power is to be read down so that it relates to "the trading activities of trading corporations" and, I would suppose, correspondingly to the financial activities of financial corporations and perhaps to the foreign aspects of foreign corporations. Even if it be thought that it was concern as to the trading activities of trading corporations and financial activities of financial corporations that led to the singling out in s. 51(xx) of these domestic corporations from other domestic corporations it would be mere speculation to say that it was intended to confine the legislative power so given to these activities. The competing hypothesis, which conforms to the accepted approach to the construction of a legislative power in the Constitution is that it was intended to confer comprehensive power with respect to the subject matter so as to ensure that all conceivable matters of national concern would be comprehended. The power should, therefore, in accordance with that approach, be construed as a plenary power with respect to the subjects mentioned free from the unexpressed qualifications which have been suggested.

It sufficiently appears from what has already been said that, even if s. 51(xx) be relevantly restricted to legislation which affects trading corporations in their trading activities, s. 45D(1)(b)(i) is within power, subject to qualifications shortly to be mentioned. The requirement of "purpose" in the provision is to be read conjunctively with the requirement of "effect" or "likely effect". Thus, regardless of the width of operation of words like "hinders", no conduct will be prohibited by par. (1)(b)(i) unless it has the effect or likely effect of causing, not merely loss or damage, but "substantial loss or damage" to the business of a corporation or a related body corporate. Such a provision has a direct legal operation upon corporations in the sense in which they are defined by the Act. The most indirect operation of par. (1)(b)(i) is in respect of conduct which hinders (rather than prevents) the supply of goods or services to or from a corporation where the conduct is engaged in for the purpose and has the likely effect (rather than the actual effect) of causing substantial loss or damage to the business of the corporation. But such an operation still involves a direct legal operation upon corporations. Quite apart from the fact that the flow of goods or services to or from a corporation is hindered, there is in addition a likelihood that the business of the corporation will be substantially damaged. Even if the hindering of the flow of goods or services did not give rise to a direct legal operation, a point which may not readily be conceded, the likelihood of the effect of substantial damage to the business of the corporation would in itself give rise to such an operation. It matters not that the operation on a corporation is preventive or prospective rather than punitive or retrospective.

It was contended that s. 45D(1)(b)(ii) was invalid, presumably with a view to arguing that pars. (i) and (ii) are inseverable. However, in my view par. (ii), as well as par. (i), is valid. It will be recalled that in Strickland [5] ss. 5(1) and 8(1) of the Australian Industries Preservation Act 1906 Cth were held valid. Section 5(1) referred to restraint of trade and unfair competition and s. 8(1) referred to monopolization with intent to control supply or price. Both provisions were valid because they dealt with trade in the market in a most direct way by preserving competition in trade. (See pp. 489 and 525.) Section 45D (1)(b)(ii) prevents a substantial lessening of competition in a market in which a corporation trades and to that extent is no different in substance from the 1906 provisions. In regulating the market s. 45D(1)(b)(ii) controls the fundamental basis of the trading activity of corporations and is therefore a law with respect to the subject matter of s. 51(xx).

The qualifications to which I referred relate to the statutory definition of corporation and to the reference in s. 45D(1)(b)(i) to a "body corporate that is related" to a corporation. The statutory definition of "corporation" is in these terms:

(b) is a trading corporation formed within the limits of Australia or is a financial corporation so formed;

(d) is the holding company of a body corporate of a kind referred to in paragraph (a), (b) or (c).

The statutory definitions of "foreign corporation", "financial corporation" and "trading corporation" attribute to each of these expressions its meaning in s. 51(xx), including in the case of a foreign corporation a body corporate that is incorporated in an external Territory and in the case of a financial corporation certain bodies corporate that carry on the business of banking or insurance. With the exception of par. (d) of the definition of "corporation", nothing turns on these definitions. In Reg. v. Australian Industrial Court; Ex parte C.L.M. Holdings Pty. Ltd. [6] , I noted that the presence of par. (d) in the definition of corporation in the Act might be a ground for concluding that the operative provisions of the Act were invalid in their application to corporations within the meaning of that paragraph. However, I went on to say "the rest of the definition is capable of a severable operation in its application in the operative provisions of the Act". Further reflection has confirmed in my mind the correctness of the view that the operative provisions to the extent to which they apply to par. (d) corporations are ultra vires, because the holding companies referred to are ex hypothesi outside s. 51(xx) and s. 122. However, the invalid operation is severable by reason of the separation of par. (d) from the rest of the statutory definition. The correctness of this view does not appear to be disputed in the present case. 1. (1977) 136 C.L.R. 235, at p. 242.

Although the expression "body corporate" is not defined, s. 4A(5) provides:

(a) is the holding company of another body corporate;

(c) is a subsidiary of the holding company of another body corporate,

that first-mentioned body corporate and that other body corporate shall, for the purposes of this Act, be deemed to be related to each other. Plainly the reach of this provision extends to corporations which stand outside pars. (a), (b) and (c) of the definition of "corporation". It therefore takes the operative provisions beyond the boundaries of Commonwealth power. However, once again it is possible to sever, this time by treating s. 45D(1)(b)(i) as if the words "or of a body corporate that is related to that person" were omitted, there being no interdependence between these words and the balance of s. 45D(1)(b)(i).

A separate attack was made on s. 45D(5) and (6). Sub-section (5) provides:

If two or more persons (in this sub-section referred to as the "participants") each of whom is a member or officer of the same organization of employees (being an organization that exists or is carried on for the purpose, or for purposes that include the purpose, of furthering the interests of its members in relation to their employment) engage in conduct in concert with one another, whether or not the conduct is also engaged in in concert with other persons, the organization shall be deemed for the purposes of this Act to engage in that conduct in concert with the participants, and so to engage in that conduct for the purpose or purposes for which that conduct is engaged in by the participants, unless the organization establishes that it took all reasonable steps to prevent the participants from engaging in that conduct.

The effect of sub-s. (5) is that when two or more persons who are members or officers of a trade union engage in conduct in concert with one another the trade union is deemed to engage in that conduct in concert with the participants and to engage in that conduct for the purpose or purposes for which that conduct is engaged in by the participants, unless the organization establishes that it took all reasonable steps to prevent the participants from engaging in that conduct.

The sub-section is not an onus of proof provision. To escape the deeming operation it will avail the trade union nothing to prove that it did not act in concert with the officers or that it did not act in concert for the relevant purpose. To escape it must go further and show that it took all reasonable steps to prevent the participants from engaging in that conduct. Consequently the operation of the sub-section is very different from that of the provisions considered in Williamson v. Ah On [7] and Milicevic v. Campbell [8] .

1. (1926) 39 C.L.R. 95. 2. (1975) 132 C.L.R. 307.

In substance s. 45D(5) is a law which makes a trade union responsible for a boycott affecting a corporation when that boycott is imposed by members or officers of the trade union, a responsibility which the trade union can only avoid if it demonstrates it has taken the action mentioned in the sub-section. As such it is a law about trade unions; to me it has a very remote connexion with corporations, a connexion so remote that the provision cannot be characterized as a law with respect to corporations of the relevant class. In my opinion it is beyond power. The result is that sub-s. (6), at least to the extent to which it has an operation consequential upon sub-s. (5) by reason of the words "or is deemed by sub-section (5) to engage", is also beyond power.

For the purposes of this case it is sufficient to declare that s. 45D(1)(b)(i) is valid in its application to trading corporations within the meaning of par. (b) of the statutory definition of corporation in s. 4(1). I would also declare that the provision is invalid in its application to a corporation within the meaning of par. (d) of that definition and in its application to a related body corporate. I would further declare that sub-s. (5) of s. 45D is invalid and that sub-s. (6) is invalid to the extent already stated.

This is a challenge to s. 45D of the Trade Practices Act 1974 Cth (the Act). Section 45D was introduced in 1977 by s. 25 of the Trade Practices (Amendment) Act 1977 and amended in 1980 by s. 4 of the Trade Practices (Boycotts) Amendment Act 1980. It followed the Report of the Trade Practices Act Review Committee ("the Swanson Committee") on, amongst other matters, " the application of the Act to anti-competitive effects of secondary boycotts by particular groups of employees, and employee or employer organisations". (See Breen Creighton, Secondary Boycotts under Attack - The Australian Experience, Modern Law Review vol. 44 (1981), 489, 492.) Section 45D in substance purports to protect corporations from injury from secondary boycotts by trade unions and their members. We are not concerned with Parliament's wisdom or unwisdom in enacting s. 45D. The only issue is whether the section is within its legislative competence.

The obvious constitutional authority for the law is the power in s. 51 (20) of the Constitution to make laws with respect to "foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth". The power extends to corporations already formed but is not confined to these. (See Stephen J. in Mikasa (N.S.W.) Pty. Ltd. v. Festival Stores [9] ; Kathleen Investments (Australia) Ltd. v. Australian Atomic Energy Commission [10] .) The notion that it is confined to corporations already formed is inconsistent with the power of the Parliament to make retrospective laws. The power is, of course, plenary; it enables Parliament to make comprehensive laws covering all internal and external relations of foreign trading and financial corporations. It extends to authorize a "Companies Act" providing for the formation, operation and dissolution of trading and financial corporations. Except in a very artificial sense, the power is not available to deal with the formation of foreign corporations, but no doubt authorizes laws dealing with their operation and dissolution. The power obviously authorizes laws dealing with the trading (or financial) operations of such corporations; for example, Parliament can legislate for the standards of products manufactured or sold by foreign and trading corporations and has done so (see ss. 62 and 63 of the Act). However, the power is not confined to laws dealing with the trading or financial operations of trading or financial corporations (nor to foreign operations of foreign corporations). It extends to laws dealing with industrial relations so that in relation to such corporations Parliament, uninhibited by limitations expressed in s. 51 (xxv), may legislate directly about the wages and conditions of employees and other industrial matters. Reg. v. Federal Court of Australia; Ex parte W.A. National Football League [11] I stated that "The corporations power may be used not only to protect persons who trade with trading corporations, but also to protect trading corporations in regard to those who deal with them" [12] . This aspect of the power is not confined to trading corporations nor to protecting them only from those who deal with them. It enables Parliament to protect trading, financial and foreign corporations from others and to protect others from such corporations. Parliament could, if it wished, enact a comprehensive criminal and civil code dealing with the protection of foreign trading and financial corporations, their property and affairs, and also the protection of others in relation to such corporations. Leaving aside sub-ss. (5) and (6), s. 45D falls easily within this aspect of the corporations power, and is valid.

1. (1972) 127 C.L.R. 617, at p. 661. 2. (1977) 139 C.L.R. 117. 3. (1979) 143 C.L.R. 190. 4. (1979) 143 C.L.R., at p. 239.

A subsidiary argument that holding companies do not come within the power, even if it were correct (and I do not think it is) raises a hypothetical issue not relevant here because the provision dealing with holding companies is severable.

Section 45D(5) and (6) raise an entirely different problem. Briefly, sub-s. (5) provides that if two or more members or officers of an organization of employees engage in conduct in concert, the organization shall be deemed for the purposes of the Act to engage in that conduct for the purpose or purposes for which that conduct is engaged in by the participants, unless it establishes that it took all reasonable steps to prevent the participants from engaging in that conduct. Sub-section (6) in substance provides that where an organization engages or is deemed by sub-s. (5) to engage in conduct in concert with members or officers of the organization in contravention of sub-s. (1) or (1A) then any loss or damage suffered by a person as a result of the conduct shall be deemed to have been caused by the conduct of the organization. Sub-section (6) also contains various consequential provisions.

In Seamen's Union of Australia v. Utah Development Co. [13] I indicated doubt of the constitutional validity of these provisions, although the prosecutor Seamen's Union of Australia did not challenge them. In Reg. v. Bowen; Ex parte Amalgamated Metal Workers' and Shipwrights' Union [14] in relation to similar provisions of the Conciliation and Arbitration Act (although the challenge to them was not pursued) it seemed to me that these were unconstitutional, although it was not necessary to express any final conclusion.

1. (1979) 144 C.L.R. 120, at pp. 156-157. 2. (1980) 144 C.L.R. 462.

Presumptions are a useful and common device for facilitating proof. Judges have recognized, that is adopted, a myriad of presumptions. These make the legal system operable. Statutory presumptions are a way of correcting the recent tendency to abandon the common law method of adapting the law (including evidence and proof) to the changing society. The justification for all presumptions is human experience of the association between the known and the presumed facts or circumstances.

It is within the general incidental power (s. 51(xxxix)) or the specific powers in ss. 51 or 52 of the Constitution to provide that one fact or circumstance shall be presumed from the existence of another, provided there is a rational basis for the presumption. Where there is no rational basis for the presumption, then in my opinion Parliament has no power to require a court to act upon the presumption. To do so would be to undermine the judicial power. Clearer still, a law that proof of one fact is deemed to be proof of another fact, so that the party against whom the second fact is alleged is prevented from attempting to disprove it, undermines the judicial power. This does not apply where the second fact is merely another description of, or an inevitable consequence of, the first fact. Sometimes deemed may only mean presumed. Also "deeming" may be used merely as a shorthand method of legislating, so that when the provisions as a whole are considered the vice is only in the form, not the substance. But here the deeming provision in s. 45D(5) and the reference to it in s. 45D(6) create a statutory fiction (see Griffith C.J. in Muller v. Dalgety & Co. Ltd. [15] ), so that the conclusion is to be made even if it is contrary to the fact. In the light of experience of Australian industrial relations, it cannot rationally even be presumed that the conduct in concert of two or more members of an organization of employees is the conduct of the organization. The conduct is often unsupported by or occasionally opposed by the organization. Also such members are often members of other organizations and of industrial and non-industrial bodies which may sponsor the conduct. The fact is that hundreds of thousands of members of federal organizations (of employees) belong to trade or industrial unions registered under State Acts. The effect of s. 45D(5) and (6) is that if two or more members or officers of an organization of employees engaged in prohibited conduct in concert this would be deemed to be the conduct of the organization (unless it could establish that it took all reasonable steps to prevent the participants from engaging in that conduct) exposing it to severe consequences. Such a law is not authorized by the corporations' power or the general incidental power in s. 51(xxxix). The legislative powers in s. 51 are subject to the Constitution, including Ch. III, The Judicature. It is not consistent with the exercise of judicial power that the courts be required to make findings contrary to fact or to adjudge persons guilty or civilly liable upon proof of facts from which a rational conclusion of guilt or liability does not follow but on the basis of a legislative conclusion which is unexaminable judicially. A similar attempt to penalize persons on the basis of legislative or executive opinions unexaminable in the courts was rejected in Australian Communist Party v. The Commonwealth [16] .

1. (1909) 9 C.L.R. 693, at p. 694. 2. (1951) 83 C.L.R. 1.

Unlike a presumption, the purpose and effect of a deeming provision is to prevent any attempt, by either party, to prove the truth. Legislative provision for suppression of the truth in judicial proceedings is inconsistent with the exercise of judicial power and unconstitutional. I leave aside the area, not pertinent here, where the law is directed to maintaining the integrity of legislative or executive processes from the judicial process.

I would adopt the words of Hayfron-Benjamin C.J. in the Supreme Court of Botswana who trenchantly criticized deeming provisions in Odendaal v. The State [17] : "The position would be grotesque indeed were it possible for the prosecution to be relieved of the burden of proving the existence of any particular incriminating fact while the defence is at the same time conclusively debarred from establishing its non-existence."

Section 45D is valid, except for the deeming provisions in sub-s. (5) and that part of sub-s. (6) which refers to sub-s. (5).

In this matter I have had the advantage of reading the reasons for judgment prepared by my brother Mason. I agree with those reasons and the conclusions to which they lead. There is nothing that I can usefully add.

I have had the advantage of reading the reasons for judgment prepared by the Chief Justice. I agree with those reasons, and with the conclusions to which they lead. Save for the observation I am about to make, I do not wish to add anything to what his Honour has said.

In substance the attack on the validity of s. 45D(1) is based on the proposition that in reality the law is not directed to those corporations with respect to which the Parliament is empowered to legislate. It is, in substance, a general law with respect to secondary boycotts, only limited in form to conduct which affects the defined corporations in order to provide the appearance of validity. It is argued that the limitation is insufficient to invest the law with the added character of a law with respect to the corporations mentioned in s. 51(xx) of the Constitution. It may be that some of the formulations of the conduct which is forbidden by s. 45D(1) lend substance to an argument that the law touches a trading corporation so incidentally as not to confer on that formulation the character requisite to validity. But we are not concerned with those formulations in this case. The argument can have no application to the paragraph (s. 45D(1)(b)(i)) with which we are concerned, because its central characteristic is conduct which is purposefully directed, with at least some likelihood of success, to the substantial prejudice of the trading activities of a trading corporation. Clothed in that character, it is a law with respect to such a corporation.

I would make the declarations proposed by the Chief Justice.

The accepted method of determing the validity of a law passed by the Parliament of the Commonwealth in reliance upon s. 51 of the Constitution is to ascertain what rights, duties, powers or privileges the law creates or affects and, by reference solely to the operation of the law thus ascertained, to see whether it is a law "with respect to" one or more of the heads of power enumerated in that section (Bank of N.S.W. v. The Commonwealth [18] ; Fairfax v. Federal Commissioner of Taxation [19] ). Of course, a right, power or privilege (hereafter "a right") cannot be detached from the person or persons upon whom it is conferred, nor can a duty be detached from the person or persons on whom it is imposed. When a law confers a right or imposes a duty upon particular persons or upon a class of persons or affects their rights or liabilities, and thereby discriminates between them and the public at large, the discrimination is an essential element of the right or duty and is therefore material to the character of the law in question. That is not to say that the character of the law is to be determined for all purposes by reference merely to the persons or class of persons whose rights or duties are augmented or altered by its provisions. Every element of the rights or duties which it creates or alters is material to its character.

1. (1948) 76 C.L.R. 1, at p. 187. 2. (1965) 114 C.L.R. 1, at p. 7.

A problem arises when the relevant head of power is expressed as a power to make laws with respect to persons. Section 51(xx) confers upon the Parliament power to make laws with respect to foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth. The power conferred by par. (xx) is not expressed as a power to make laws with respect to a function of government, a field of activity or a class of relationships. If a law augments or alters the rights and duties of one or more of the classes of corporations mentioned in par. (xx) and thereby discriminates between those corporations and the public at large, is that sufficient to bring the law within the head of power? Or is it necessary that the rights and duties which the law augments or alters should be rights or duties affecting particular activities or relationships? And, if so, what are those particular activities or relationships?

In Strickland v. Rocla Concrete Pipes Ltd. [20] it was held that it was not enough that a law imposed duties indifferently upon the corporations mentioned in par. (xx) and upon other persons. Walsh J. said [21] :

It is, of course, true of any law that obedience to it can be rendered only by persons and sanctions for disobedience can be imposed only upon persons. But that does not mean that every law is a law with respect to the persons or to the classes of persons who are required to obey it. In the present cases the laws cannot be described, in my opinion, as laws which are, either wholly or in part, laws with respect to the corporations mentioned in par. (xx). It is not enough to attract that description that, being expressed in general terms, they apply to those corporations, as well as to other corporations, and to natural persons: see Bank of New South Wales v. The Commonwealth [22] , per Latham C.J. Windeyer J. held the same view [23] . The view of Barwick C.J. was that a law was not supportable by par. (xx) even if it were addressed specifically to corporations mentioned in that paragraph - a question left open by Menzies J. [24] - unless some further nexus appeared. The Chief Justice found a sufficient further nexus in the effect of the law upon the trading activity of such corporations. He said [25] : I ought to observe that it does not follow either as a logical proposition, or, if in this instance there be a difference, as a legal proposition, from the validity of those sections, that any law which in the range of its command or prohibition includes foreign corporations or trading or financial corporations formed within the limits of the Commonwealth is necessarily a law with respect to the subject matter of a s. 51(xx.). Nor does it follow that any law which is addressed specifically to such corporations or some of them is such a law. Sections 5(1) and 8(1), in my opinion, were valid because they were regulating and controlling the trading activities of trading corporations and thus within the scope of s. 51(xx.). In Rocla Pipes, it was not necessary to consider a wider ambit of the power than the control of the trading activities of corporations mentioned in par. (xx). It was held that a law directed to those corporations regulating, controlling or dealing with their trading activities is a law with respect to them [26] . It is material to an argument presently to be mentioned that Menzies J. [27] held the power to extend to the governing of the conduct of the business of a trading corporation: I am not prepared to attempt to define the limits of the power conferred by s. 51(xx.). I content myself with saying that a law such as s. 5 of the Australian Industries Preservation Act governing the conduct of its business by a trading corporation formed within the limits of the Commonwealth is within the power of the Parliament by virtue of s. 51(xx.). 1. (1971) 124 C.L.R. 468. 2. (1971) 124 C.L.R., at p. 516. 3. (1948) 76 C.L.R., at p. 186. 4. (1971) 124 C.L.R., at p. 512. 5. (1971) 124 C.L.R., at p. 508. 6. (1971) 124 C.L.R., at pp. 489-490. 7. (1971) 124 C.L.R., at pp. 491, 511, 528. 8. (1971) 124 C.L.R., at p. 511.

The command of s. 45D of the Trade Practices Act 1974 Cth, the validity of which is in question, is addressed indifferently to all persons. Its effect is not to regulate or control the businesses or trading activities of corporations mentioned in par. (xx) but to protect those businesses from the consequences of the conduct which the section prohibits. The section is concerned with the rights of corporations, not with their duties, and such discrimination as the law effects flows from the conferring of protection upon them in the carrying on of their businesses. In a sense, this case presents the obverse of the problem faced in the Rocla Pipes Case. If a law discriminates between one or more of the classes of corporations mentioned in par. (xx) and the public at large by imposing upon corporations of such a class a duty as to the manner in which they conduct their trading activities and the law falls accordingly within the ambit of the power conferred by that paragraph, is a law which discriminates by protecting the trading activities of those corporations within the ambit of the power?

If corporations are the special beneficiaries of the protection which the law affords, it is not to the point to say that the law is not expressed to bind them. The relevant question is whether a law which gives the businesses of corporations the protection specified in s. 45D is within the ambit of the power. Before examining the terms of the section, two observations should be made.

First, the practice of this Court in interpreting the Constitution case by case, deciding only so much as is necessary to decide the case in hand is of particular importance when the head of power has not hitherto been the subject of extensive judicial exegesis. Hewing close to the issues raised by each case, the Court avoids the possibility of having its judgment applied to issues which were not envisaged in the arguments before it and which may have implications emerging only in the future. The development of principle from the concrete issues of particular cases may be slow, but it gives assurance that the principle will not be unsuited to the solution of practical problems. It follows that it is undesirable to answer a question left open in an earlier case unless an answer is evoked by the issues in the case in hand. In the present case, it is not necessary to determine whether any law which discriminates between corporations mentioned in par. (xx) and the public at large is a law falling within the ambit of the corporations power; but it is necessary to determine whether a law which affords a discriminatory protection to the businesses of trading corporations formed within the limits of Australia is valid.

Second, to determine the validity of s. 45D it is desirable to commence with what has been judicially established as falling within the ambit of the power and to enquire whether principles already enunciated yield a solution to the present problem. Clearly enough, neither Rocla Pipes [28] nor any of the cases which followed it have held that the conferring of a right upon corporations mentioned in par. (xx), as distinct from the imposition of duties upon them, gives to a law the character of a law with respect to those corporations. But what is the difference in point of constitutional principle between two laws each of which discriminates between corporations mentioned in par. (xx) and the public at large, one of which imposes a duty upon those corporations affecting the conduct of their trading activities, the other of which confers a protection upon those corporations in the conduct of the same activities? There is none, for a law which affects those corporations in the conduct of their trading activities exhibits the same nexus with those corporations whether it regulates or whether it protects their trading activities. And so I go to examine the nature of the rights, powers or privileges created by s. 45D, to enquire whether the Act discriminates in conferring them upon corporations mentioned in par. (xx), and to ascertain whether they affect the same subject matter as that which has been held in earlier cases to provide a sufficient nexus with the power.

By use of conjunctives and disjunctives, the draftsman of s. 45D(1) has created a provision which has a multiform operation. Each element mentioned in the sub-section may be combined with other elements, each combination being severable from the others. The number of combinations is increased by the separate classes of corporations included in the definition of corporation in s. 4(1). The combination with which these proceedings is concerned emerges from the issues raised in the cause pending in the Federal Court of Australia. So much of that cause as involves the validity of s. 45D has been removed here for decision.

Fontana Films Pty. Ltd. ("Fontana") which claims to be and for present purposes must be assumed to be a trading corporation formed within the limits of Australia - though that will be a matter for concession or proof at the trial - in reliance upon s. 45D(1) seeks to compel the lifting of a black ban allegedly imposed by the appellants upon the supply by theatrical agencies of the services of actors and actresses whose services are essential to Fontana's business as a producer of films. These proceedings are concerned therefore with a combination which picks up par. (b) of the statutory definition of corporation, namely, a trading corporation formed within the limits of Australia or a financial corporation so formed. The combination upon which Fontana, as a corporation within the definition, must place reliance in order to found its claim for relief is to be found in s. 45D(1)(b)(i), excluding the reference to a related body corporate in sub-par. (i), and in sub-ss. (5) and (6) of that section. The relevant part of sub-s. (1) reads as follows:

Subject to this section, a person shall not, in concert with a second person, engage in conduct that hinders or prevents the supply of services by a third person to a fourth person (not being an employer of the first-mentioned person), where -

(b) the fourth person is a corporation and the conduct is engaged in for the purpose, and would have or be likely to have the effect, of causing -

(i) substantial loss or damage to the business of the fourth person

This provision, when coupled with ss. 80 and 82 and par. (b) of the definition of corporation in s. 4, confers upon trading and financial corporations a right to recover damages for loss or damage occasioned by conduct which contravenes the provision and a right to seek an injuction to restrain a person from engaging in that conduct. The businesses of trading and financial corporations are protected against conduct - (1) which is engaged in for the purpose of causing substantial loss or damage to the business; (2) which would have the effect of causing substantial loss or damage to the business, or which would be likely to do so; (3) which hinders or prevents the supply of services by a third person to the corporation; and (4) which is engaged in by two persons in concert. A right, power or privilege is thus conferred upon trading and financial corporations, which is not conferred upon the public at large. As the provision is concerned with the rights of trading and financial corporations, it is immaterial that the provision directs its commands to the public at large. It is material that the provision discriminates in favour of those corporations in conferring rights upon them.

But does the provision affect the same subject matter as that which has been held in earlier cases to provide a sufficient nexus with the corporations power? The subject matter which the provision selects as the object of its protection is "the business" of the corporation. That was the subject matter to which Menzies J. referred in the passage above cited from his judgment inRocla Pipes [29] . His reference to "business" may be compared with the references to "trading activity" in other judgments in Rocla Pipes. In Reg. v. Trade Practices Tribunal; Ex parte St. George County Council [30] and in Reg. v. Federal Court of Australia; Ex parte W.A. National Football League [31] , trading activity rather than the carrying on of business was regarded as material to the character of a corporation falling within the description of trading corporation. At all events, the concepts of business and trade are not coextensive (cf. Hornsby Shire Council v. Salmar Holdings Pty. Ltd. [32] ), and there may be some business of a trading corporation which is not trading activity. Clearly the term business in s. 45D(1) is intended to comprehend more than "trading activity", for the sub-section applies as well to the businesses of foreign corporations, corporations incorporated in a Territory and to the holding companies of corporations elsewhere referred to in the definition in s. 4 as to the businesses of trading and financial corporations formed within the limits of Australia. It may be that "business" was the term thought appropriate to describe compendiously the commercial operations of corporations of the various classes specified in the definition.

1. (1971) 124 C.L.R. 468. 2. (1974) 130 C.L.R. 533. 3. (1979) 143 C.L.R. 190. 4. (1972) 126 C.L.R. 52, at pp. 54, 56, 60.

Although the meaning of "business" is not restricted to "trading activity", the business to which the relevant provision relates in these proceedings is the business of a trading or financial corporation. More specifically, the business of a trading corporation. The operation of the provision in respect of the businesses of corporations, as defined, other than trading and financial corporations is not presently material: the operation of the provision in those other cases, and particularly in relation to the businesses of holding companies, in severable from its operation in respect of the businesses of trading and financial corporations (Reg. v. Australian Industrial Court; Ex parte C.L.M. Holdings Pty. Ltd. [33] ).

A trading corporation is one whose trading activities "form a sufficiently significant proportion of its overall activities as to merit its description as a trading corporation", to adopt the test which Mason J. expressed with the concurrence of Jacobs J. in Reg. v. Federal Court of Australia; Ex parte W.A. National Football League [34] . The business of a trading corporation therefore includes a proportion of trading activity sufficiently significant to identify the corporation as a trading corporation. A provision which protects the business of such a corporation necessarily protects its trading activity, which is the subject matter that has been held to provide a sufficient nexus with the power in earlier cases. It is true that the provision may also protect an additional subject matter, namely, the non-trading business of a trading corporation. But given that the law exhibits those indicia which would give it the character of a law with respect to trading corporations, how does it lose that character by affecting the non-trading business of those corporations? The non-trading business of a trading corporation is nonetheless an aspect of its existence and activity. A law which, discriminating between one or more of the corporations mentioned in par. (xx) and the public at large, protects both the trading and non-trading businesses of trading corporations, wears the appearance of a law with respect to those corporations. It is of the nature of the power that it is a power to make law with respect to corporate persons, not with respect to functions, activities or relationships. The subject matter of activities or relationships which the law affects may be relevant to the question whether the law is truly to be described as a law with respect to corporations mentioned in par. (xx), but the validity of the law cannot be determined as though the power were expressed as a power to make laws with respect to the trading or some other activity of or relationship with corporations mentioned in par. (xx).

Where the subject matter affected by a law is trading activity, the law affects the heart of the purpose for which trading corporations are formed or a significant activity in which they are engaged. That circumstance gives a clear pointer to the character of the law. But if the law affects also more peripheral matters, it does not necessarily lose its character as a law with respect to trading corporations; indeed the additional subject matter may confirm the character which would otherwise be attributed to the law.

The combination of elements within s. 45D(1) with which these proceedings are concerned discriminates between trading corporations and the public at large, protects the trading activities of those corporations together with any non-trading businesses carried on by them, and confers upon them rights of action to enforce the protection which the provision accords. It is a law with respect to trading corporations within the power conferred upon the Parliament by par. (xx).

Sub-section (5) of s. 45D is or may be relied on by Fontana in order to make Actors and Announcers Equity Association of Australia liable as though it were a participant in the conduct of which Fontana complains. The Association, a trade union registered under the Trade Union Act 1881 N.S.W., is an organization of employees within the meaning of that term in the sub-section. Sub-section (5) provides, in the circumstances therein set out, that such organizations "shall be deemed for the purposes of this Act to engage in that conduct in concert with the participants for the purpose or purposes for which that conduct is engaged in by the participants". The sub-section imposes upon an organization to which the sub-section applies and which had not engaged in conduct prohibited by s. 45D(1) a liability as though it had so engaged. The measure of the organization's liability is provided for by sub-s. (6) which is expressed to apply in either of two situations: where the organization engages in conduct in concert with members or officers of the organization in contravention of sub-s. (1) or (1A) or where the organization "is deemed by sub-section (5)" so to engage in that conduct.

An organization upon which liability is imposed by reason only of what it is deemed to have done under sub-ss. (5) and (6) is beyond the reach of a law enacted pursuant to par. (xx). A law which purports to impose liability upon an organization which takes no steps, either participatory or preventive, in the conduct in which its officers or members engage in concert with one another in contravention of sub-ss. (1) or (1A) is not a law with respect to corporations. Paragraph (xx) does not empower the Parliament to confer upon a corporation a right against an organization which has not caused it loss or damage merely because two or more of its officers or members cause loss and damage to that corporation. The corporations power does not support a law which makes an organization liable for conduct in which it has not engaged and which it has not counselled, aided or abetted.

Sub-section (5) and the part of sub-s. (6) which which it is linked are not mere evidentiary provisions of the kind considered in Milicevic v. Campbell [35] and Williamson v. Ah On [36] . They do not merely reverse the ordinary onus of proof; they preclude inquiry into whether the organization has in fact engaged in the conduct to which liability is attached. They purport to bring within the operation of a valid law an organization which, not having engaged in the conduct proscribed, is beyond the reach of that law. They are invalid.

1. (1975) 132 C.L.R. 307. 2. (1926) 39 C.L.R. 95.

I would declare: 1. that sub-s. (1)(b)(i) of s. 45D up to and including the words fourth person in sub-par. (i) is valid in its application to trading corporations within the meaning of par. (b) of the statutory definition of corporation in s. 4(i); 2. that the whole of sub-s. (5) of s. 45D and the words "or is deemed by subsection (5) to engage" in sub-s. (6) of s. 45D are invalid.

I do not perceive any need to make a declaration in wider terms in these proceedings, and I would not do so.