Committee of Direction of Fruit Marketing v Australian Postal Commission

1. (1979) 37 F.L.R. 457; 25 A.L.R. 221. 2. (1978) 139 C.L.R. 288.

Nothing that has been said on this appeal has led me to suppose that Smithers J. or, on appeal, Franki J. (with whose judgment Brennan J. concurred) and Northrop J. in any way erred in their conclusion that the Committee is indeed an authority of the State of Queensland within the meaning of by-law 118.

Agreeing as I do with their Honours respective reasons for judgment, I do not propose to add anything further to the now considerable judicial consideration which the matter has already received. It is unfortunate that this by-law was initially framed in terms which involve so imprecise a concept as that of "an authority of the Commonwealth or of a State". As a by-law it can, no doubt, readily now be amended so as clearly to express whatever it is which the Commission intended by the phrase.

The Committee of Direction of Fruit Marketing ("the C.O.D.") is the proprietor of the Queensland Fruit and Vegetable News, a publication which formerly enjoyed concessional postage rates as a registered publication under the Postal Services Act 1975. Following amendment of the relevant Postal By-laws in 1977, the C.O.D. applied on 8th August 1977 for the registration of the publication in order that the concessional rate would continue to apply, but the application was refused by the delegate of the Australian Postal Commission on 27th October 1977. The delegate concluded that the C.O.D. was an authority of the State of Queensland, and that consequently its publication was not eligible for registration.

A publication is eligible for registration as a registered publication if -

(a) its proprietor is not the Commonwealth, a State or an authority of the Commonwealth or of a State;

The C.O.D., exercising the right accorded to it by by-law 126 (2), applied to the Administrative Appeals Tribunal for review of the decision of the delegate. The review was undertaken by Smithers J., and on 23rd March 1978 his Honour affirmed the decision on the ground that the C.O.D. "is an authority of the State of Queensland within the meaning of Postal By-law 118 (a)". He explained that decision by saying:

To my mind the essential and arresting feature of the C.O.D. is the nature and extent of its duties, functions and powers in the matter of issuing commands inconsistent with the ordinary rights of citizens in property and commerce to implement the intention of Parliament that marketing of fruit be organised marketing.

The C.O.D. appealed to the Federal Court of Australia, pursuant to s. 44 of the Administrative Appeals Tribunal Act 1975. Although the Federal Court entertains such an appeal in the exercise of its original jurisdiction (Federal Court of Australia Act 1976, ss. 19, 20), the jurisdiction is exercised by a Full Court: Administrative Appeals Tribunal Act s. 44 (3). In the present case, the Federal Court (Franki, Northrop and Brennan JJ.) unanimously affirmed the decision of the Tribunal [7] . Nothing daunted, the C.O.D. now appeals to this Court.

(1) That the Full Court of the Federal Court was wrong in law in holding that the Appellant was an Authority of the State within the meaning of that term under Postal by-law 118 made by the Australian Postal Commission under the Postal Services Act, 1975.

(2) That the said Full Court erred in its application of the principles enunciated by the High Court of Australia in General Steel Industries Incorporated v. Commissioner for Railways (N.S.W.) [8] ; Federal Commissioner of Taxation v. Silverton Tramway Co. Ltd. [9] and the Western Australian Turf Club v. Federal Commissioner of Taxation [10] .

1. (1964) 112 C.L.R. 125. 2. (1953) 88 C.L.R. 559. 3. (1978) 139 C.L.R. 288.

The judgments of Stephen and Aickin JJ. in the last-mentioned case [11] together with the decision of Barwick C.J. in General Steel Industries [12] point up, by reference to comparable provisions in other legislation, the range of considerations to which regard will be had in determining whether the C.O.D. is an "authority of the State". We do not propose to repeat the discussion which is to be found in those cases. The principle is clear that no one consideration will necessarily be decisive, and that more often it will be a question of fact and degree, depending both on the particular statutory description which is required to be satisfied and the features of the body in question which are relevant to that description. In our opinion, this case falls to be determined in the light of such an examination.

1. (1978) 139 C.L.R., at pp. 295-298, 309-313. 2. (1964) 112 C.L.R. 125, at pp. 127-138.

The constitution, function and powers of the C.O.D. are found in the provisions of The Fruit Marketing Organisation Acts of 1923 and the Regulations and The Primary Producers' Organisation and Marketing Acts, 1926 to 1973.

The salient provisions contained in the former Act are as follows:

(1) There shall be established, in manner hereinafter provided, an organisation for the marketing of Queensland fruit, having the functions, powers, authorities, duties, and responsibilities hereinafter set forth.

constituted in the manner and having the functions, powers, authorities, duties and responsibilities hereinafter set forth or as may be prescribed.

In order to prevent disputes from arising between the component parts of the organisation hereinbefore in this section specified any question right claim matter or thing relating to the said functions powers authorities duties or responsibilities if and when it may arise may be referred in writing to the Minister and the Minister may give such directions as he shall think fit which directions shall be observed and obeyed by the parties concerned.

(1) There shall be constituted a Committee of Direction of fruit marketing in manner hereinafter provided.

(2) The Committee of Direction shall be a body corporate by the name of "The Committee of Direction of Fruit Marketing," and shall have perpetual succession and an official seal which shall be judicially noticed, and the Committee of Direction shall be capable in law of suing and being sued.

(4) The Committee of Direction shall not be deemed to represent the Crown for any purpose whatsoever.

(5) Subject to this Act the Committee of Direction shall have power in respect of the matters and things following, namely: -

(i) To purchase, sell, exchange, lease, and hold land, goods, chattels, securities, and any other property whatsoever in the State of Queensland or in any other State or territory of the Commonwealth of Australia;

(ii) To contract for the use of, erect or otherwise provide any buildings or structures, and repair, equip, furnish, and maintain the same;

(iii) To appoint, engage, employ, and pay such officers, servants, employees, agents, and other persons as are deemed necessary;

(iv) To arrange for financial accommodation with any bank or banks or with the Government of the State or of the Commonwealth of Australia, and to borrow or raise money on the security of fruit or other security or otherwise and to create and to issue in favour of any person or corporation mortgages of any kind, charges, guarantees, securities, and other obligations;

(v) To enter into any agreements and contracts and to give guarantees and indemnities in favour of any person or corporation contracting with the Committee of Direction or that may enter into any contract at the request of or under the authority or direction of the Committee of Direction;

(vi) To enter upon and carry into execution the marketing of fruit, and for that purpose to do all such things as are deemed necessary or convenient; to trade in fruit, and as and when deemed necessary, to purchase fruit for resale and to do all or any of such things as either principal or agent;

(vii) To impose levies on fruit marketed, whether or not such fruit is or is about to be marketed by or under the authority of the Committee of Direction pursuant to a direction or an Order in Council in that behalf duly issued under the provisions hereinafter set forth;

(viii) To do all such other acts, matters, or things as may be prescribed.

(6) The Committee of Direction may make arrangements for the financing of local associations and of sectional group committees.

(1) If the Committee of Direction satisfies the Secretary for Public Lands that it requires any land for any purpose relating to the marketing of fruit and/or vegetables and that it is unable to obtain such land by agreement, the said Minister may, with the prior approval of the Governor in Council, take such land, under and subject to the provisions of " The Public Works Land Resumption Acts, 1906 to 1940."

(2) Subject to this section, marketing as defined in this Act shall be a purpose for which land may be taken under " The Public Works Land Resumption Acts, 1906 to 1940," and as respects the taking of land for such purpose the Secretary for Public Lands shall have and may exercise all the powers and authorities of the Crown as a constructing authority under such lastmentioned Acts.

(3) The proclamation taking any land, or a later proclamation, shall vest such land in the Committee of Direction. Moreover, the Committee of Direction shall be liable for and shall pay the compensation in respect of such land and all other costs, charges, and expenses incurred in connection therewith; and the Crown and the said Minister are hereby indemnified against all claims and liabilities in respect of such taking.

(1) The Governor in Council may, from time to time, by Order in Council require the Committee of Direction to carry on as principal the business of supplying fruit and vegetables by retail or wholesale, or both, in such Local Authority Areas as are specified in such Order in Council.

(1) The Committee of Direction shall have power from time to time to issue a direction with respect to all or any of the matters following, namely: -

(i) That all or any of the things included in the marketing of fruit shall be done only by the Committee of Direction, its agents and servants, or only by such person or class of persons as the Committee of Direction may appoint;

(ii) That all fruit in the possession or coming into the possession of any person whomsoever in the course or for the purpose of marketing fruit and during such time as may be determined shall be handled and dealt with only under the instructions and with the authority of the Committee of Direction, or shall be consigned or delivered only to such persons as the Committee of Direction may appoint.

Any thirty growers of the fruit to which the proposed direction relates, and being growers thereof either within the State or the part thereof or the locality or localities to which the direction relates, may by petition to the Committee of Direction request that a poll of the growers concerned be taken upon the question of the issue of the direction.

Thereupon the Committee of Direction shall take such poll of such growers accordingly, and if less than three-fifths of the votes polled at the poll are in favour of the issue of the direction, such direction shall not be given.

(5) If within the period of thirty days aforesaid no petition for a poll is received by the Committee of Direction, or if after a poll has been taken the result of the poll is in favour of issuing the direction, the Committee of Direction may issue the direction and the direction shall forthwith come into effect according to its tenour and shall remain in force during the period limited by the direction, and shall be observed by the Committee of Direction and by the growers of the fruit to which the direction relates, and by all other persons concerned.

(i) Fails to comply with or acts in contravention of any provisions of a direction duly issued under this section; or

(ii) Offers by advertisement or otherwise to buy or to accept delivery of fruit and/or vegetables from any person who, upon accepting such offer and selling or delivering such fruit and/or vegetables to such firstmentioned person, would act in contravention of such a direction

At any time any thirty growers of any particular class of fruit of those classes of fruit specified in paragraph (i) of subsection two of section seven may by petition to the Committee of Direction request that a poll of growers concerned be taken that an Order in Council be issued by the Governor in Council declaring that the whole of that particular class of fruit produced in Queensland or in any part or parts thereof shall be acquired by the Committee of Direction as the owners thereof under the provisions of this section.

The Committee of Direction may take (or may refuse to take) such poll of such growers accordingly, and if on the taking of such poll less than three-fifths of the votes polled are in favour of the making of such Order in Council, such Order shall not be made.

If the result of the poll is in favour of the making of an Order in Council, the Governor in Council may by Order in Council provide and declare that such fruit shall be acquired by the Committee of Direction as the owners thereof, either forthwith upon the making of such Order or on and from a date to be fixed by such Order, or upon the fulfilment of such conditions as are therein mentioned, so that the property in such fruit shall be divested from the growers thereof and become vested in and be the property of the Committee of Direction as the owners thereof under and for the purposes of this Act and such Order in Council, and may by such Order in Council confer and impose upon the Committee of Direction all such powers and duties as are deemed necessary or convenient for the purposes of enabling the Committee of Direction effectively to carry out the marketing of such fruit as the owners thereof for and on behalf of such growers:

Subject to this Act, the Committee of Direction shall have power to do all of the things following, namely: -

(i) To require the co-operation of local associations with a view to having one channel of receipt and despatch at station siding or outport;

(ii) To encourage the provision of packing sheds where conditions are suitable;

(iii) To establish a system of inspection of fruit;

(iv) To arrange for transportation, cartage, and handling of fruit and to transport, cart and handle fruit;

(vi) To make agreements with fruit commission agents, fruit canners, and other persons;

(vii) To do all things deemed necessary in the direction of extending markets;

(viii) To prohibit or regulate the use and management of fruit stalls at railway stations and fruit-growers' retail shops; to use and manage any of these in the course of marketing;

(ix) To arrange for financing the operations of local associations and of sectional group committees;

(x) To do all such other things as are deemed necessary to enable the Committee of Direction to perform its functions and as are approved by the Governor in Council:

Provided, however, that the powers conferred by this subsection shall not be exercisable or exercised by the Committee of Direction in relation to any matter which ought under the circumstances to be the subject of a direction issued under section seven of this Act or which ought under the circumstances to be the subject of an Order in Council under section 7A of this Act, unless or until an effective direction or Order in Council in that behalf has been duly issued or unless or until an agreement in that behalf under section 7B of this Act has been made by and between the Committee of Direction and the grower concerned.

If at any time any question or dispute arises as to whether or not any matter with respect to which the Committee of Direction is exercising or proposes to exercise any of the powers aforesaid ought to be made the subject of a direction or of an Order in Council before the powers are exercisable or are exercised, that matter shall be referred by the Committee of Direction to the Minister, who shall consider the matter and determine the question or dispute, and his determination thereon shall be final and without appeal to any legal tribunal.

(1) The Committee of Direction shall be constituted by the appointment by the Minister of not more than two representatives of each and every sectional group committee elected by the sectional group committees respectively.

In addition to the representatives specified in subsection one of this section, the Director of Marketing shall be ex officio a member of the Committee of Direction.

The Governor in Council may also appoint a person as member of the Committee of Direction who shall represent the consumers thereon.

8. Any person who obstructs or impedes the Committee of Direction in exercising any of the functions, powers, authorities, duties, and responsibilities vested in or imposed upon them by this Act shall be subject to such penalty as may be prescribed.

The Committee of Direction and all other bodies (including any sectional Group Committee) functioning under this Act, shall cause true and regular accounts to be kept of all sums of money received and paid for or on account of this Act or pursuant thereto, and of the several purposes for which sums of money have been received and paid.

Statements of accounts shall be accepted at such places and at such times as may be prescribed.

Such accounts shall be audited by the Auditor-General, who shall have with respect to such accounts all the powers conferred on him by " The Audit Acts, 1874 to 1906."

(i) The funds of the Committee of Direction shall consist of -

(a) Moneys derived from general activities not directly conducted for and on behalf of any Sectional Group Committee or Sectional Group Committees; and

(b) Moneys derived from levies and activities conducted directly on behalf of any specific Sectional Group Committee or Sectional Group Committees.

(ii) All funds derived in manner referred to in paragraph (b) of the preceding subsection shall so far as practicable be allocated in the books of the Committee of Direction between the different Sectional Group Committees according to the extent to which the different sections have respectively contributed thereto, and all expenses being the general administrative and business expenses of the Committee of Direction including all fees, allowances, and travelling expenses to members of the Committee of Direction and of the Sectional Group Committees shall be debited to and allocated between the different Sectional Group Committees and the funds derived in manner referred to in paragraph (a) of the preceding subsection as determined by the Committee of Direction from time to time. Moneys derived from levies shall be applied in accordance with the purposes for which they were imposed.

(1) The Governor in Council may make such regulations

Without limiting the generality of the foregoing provision, such regulations may provide for all or any of the following matters: -

Empowering the Committee of Direction to make levies for the purposes of this Act on fruitgrowers, either generally or in sections of industries or in particular districts or localities, and prescribing the manner and method of making such levies and fixing the amounts of such levies, whether on the same or on different bases, in respect of the different sections, operations, districts, or localities;

Providing, if deemed necessary, for the expenditure of the sums raised by any particular levies only in the interests of the particular section of industry or district or locality upon the fruitgrowers in which such levies were made;

Providing methods of recovery or collection of any such levies or fines, including the recovery or collection of such levies from persons holding moneys to the credit of the fruitgrowers liable to pay such levies; Imposing fines not exceeding forty dollars for non-payment of such levies or moneys by fruitgrowers or persons holding moneys to the credit of the fruitgrowers;

The regulations made pursuant to this power empower the C.O.D. by resolution to impose a levy in respect of certain fruit and vegetables. The amount of the levy is fixed by the regulations, and is payable by every grower who sells or delivers for sale the produce in question. There are detailed supporting provisions which impose obligations to pay the levy, to render returns and allow inspection of books of account. In some circumstances, these obligations are imposed on third parties who participate in the marketing of the produce whether as farm produce agents, carriers or the like. Any breach of the regulations renders the grower or third party, as the case may be, guilty of an offence, and liable to a penalty of $40.00. In the event of prosecution, all allegations of fact in the complaint shall be deemed to be proved in the absence of proof to the contrary. All moneys raised by a levy are to be expended and used by the C.O.D. only in the general interests of that section of the primary industry to which the levy related and as directed from time to time by the appropriate Sectional Group Committee.

This recital of statutory provisions from which the nature and function of the C.O.D. are to be discerned is not complete without a reference to the provisions of the Primary Producers' Organisation and Marketing Acts, 1926 to 1973. This Act establishes a Council of Agriculture (s. 4). Mr. Ambrose, counsel for the respondent, described the Council as the apex of the whole structure of organized marketing of primary products in Queensland. The Minister and the Director of Marketing are members of the Council, and the C.O.D., together with other commodity boards are represented. The primary function of the Council appears to be an advisory role directed to the development of the rural industries, and the furtherance of the interests of primary producers (s. 7). The Act establishes also a Council of Agriculture Fund which is charged with the payment of all expenses incurred by the Council in the execution of the Act and such other expenses as may be approved by the Governor in Council (s. 5). The Council is empowered to require a contribution each year from, inter alia, the C.O.D., calculated by reference to the administrative and other expenses of the Council in connexion with the commodities for which the C.O.D. is constituted (s. 28). In order to meet that contribution, and for other purposes set out in s. 29 (2), the C.O.D. may with the prior approval of the Minister, from time to time make a levy in such amount as it, with the approval of the Minister, may determine (s. 29 (1)). The consent of a majority of the growers is required in some circumstances, but not others. Section 29 (2A) is an exceptional provision. It empowers the Governor to require and direct, inter alia, the C.O.D. to make a levy in order to establish a fund as security to meet any liability or obligation undertaken by His Majesty the King for or on behalf of the C.O.D.; in such a case no poll of growers may be taken. The powers and duties of the C.O.D. with respect to levies on fruit growers contained in this Act shall not be constructed to limit its powers in that respect under The Fruit Marketing Organisation Acts (s. 29 (3)).

Mr. Cooke, counsel for the appellant, argued that all these provisions, when properly understood did no more than to establish the C.O.D. as a body with statutory powers to further the interests of the growers and to enable them to engage effectively in the business of marketing their produce (cf. Federal Commissioner of Taxation v. Silverton Tramway Co. Ltd. [13] , per Taylor J.). So stated, it is not an authority performing the work of government. He pointed to the provision that the C.O.D. shall not be deemed to represent the Crown for any purpose whatsoever, and to the fact that it has no access to government finances, its only funds being derived from its own activities and from levies imposed by it upon growers. Another important feature, in his submission, is the relationship between the growers and the exercise by the C.O.D. of its powers. It is constituted primarily from persons nominated by the growers, the power to give directions and the exercise of the power in The Fruit Marketing Organisation Acts to make a levy may be subjected to the will of the growers of the particular commodity as expressed through a poll, and the proceeds of such a levy are to be expended in a manner directed by the appropriate Sectional Group Committee.

The question to be determined is whether the appellant is or is not "the Commonwealth, a State or an authority of the Commonwealth or of a State". No other test is provided. Nevertheless the totality of the provision is instructive, and some conclusions may be drawn from it. Clearly, it is not confined to the Crown and those bodies which are so closely identified with the Crown as to enjoy its immunities. Consequently, the provisions of s. 6 (4) cannot be decisive in favour of the appellant. Again, the test is not whether the body in question draws its funds from government sources.

In our opinion, the focus is upon government, and the function of government. If the appellant is to succeed, it must be because the proper conclusion, based on the legislation, is that the C.O.D. is not engaged in the work of government, notwithstanding that it is created a statutory authority with a wide range of powers. It would have to be shown that the authority represented by those powers in reality is derived from the growers, not from the State. We have endeavoured to state the proposition in terms as favourable as possible to the appellant, but however it be stated it is with respect manifestly insupportable. The purpose of the Act is to organize the marketing of fruit. That is as capable of being a governmental purpose as the maintenance of law and order and the administration of justice (cf. Professional Engineers Case, per Windeyer J. [14] ). The range and scope of governmental purposes may vary from time to time, and will be determined by the content of the public laws that are in force for the time being. The manner in which the Act pursues the objective of organized marketing of fruit is clearly, in our opinion, to impress the stamp of government upon the activities of the C.O.D. The concern of the legislature to ensure that the wishes of the growers are reflected in the decisions of the C.O.D. in the matter of directions as to how and when and where marketing should proceed, and in the imposition of certain levies, does not alter the fact that those decisions are essentially governmental decisions. In the words of Smithers J. in this case: " government is still government albeit representative government, and even if dependent in some respects upon the will of the governed The authority and effectiveness of the decisions of the C.O.D. are derived not from growers but from the State". We do not propose to spell out expressly from the lengthy citation of the relevant statutory provisions which appears earlier in this judgment those characteristics which lead to this conclusion. They are sufficiently exposed in the judgments from which the appeal is brought. However, we would remark on the considerable degree of participation by the Minister and the Governor in Council in the operation of the legislative scheme. The Minister's powers and responsibilities include the following: (a) the resolution of disputes within the organization, including a power to give directions in that regard (ss. 4 (2), 8 (1), 10 (2)); (b) the compulsory acquisition (with the approval of the Governor in Council) of land that the C.O.D. requires for any purpose relating to the marketing of fruit (s. 6E); (c) the authorizing in writing of an officer of the Department of Agriculture and Stock to enter the premises of any person carrying on the business of the processing, manufacture or treatment of fruit and inspect fruit and/or records to ascertain whether any person is guilty, in relation to a direction given by the C.O.D., of any offence against the Act (s. 7 (8)); (d) the appointment of the members of the C.O.D. (s. 9 (1)); (e) the approval of a levy, including the amount of the levy, imposed by the C.O.D. pursuant to the power granted by s. 29 (1) of The Primary Producers' Organisation and Marketing Acts.

The Governor in Council may require the C.O.D. to carry on as principal the business of supplying fruit and vegetables by retail or wholesale (s. 6F). He may also, following the requisite poll of growers, declare the property in fruit to be compulsorily acquired by the C.O.D., and confer and impose upon the C.O.D. all such powers and duties as are deemed necessary or convenient for the purposes of enabling the C.O.D. effectively to carry out the marketing of such fruit as the owners thereof for and on behalf of such growers (s. 7A). He may make regulations, including those relating to the imposition of levies by the C.O.D. Finally, there is the power of the Governor in Council to require and direct the C.O.D. to levy growers in order to reimburse the Crown for expenditure it may have incurred on its behalf.

In our opinion, the legislation clearly creates the appellant an instrument of government and equips it with the powers to achieve the organized marketing which is the purpose of the legislation. It is properly described as "an authority of a State" within the meaning of Postal By-law 118.