Duncan v Queensland [1916] HCA 67

Duncan v Queensland [1916] HCA 67 - HCA 1916 case summary — Zoe

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indeed, it were held that sec. 92 does not apply to the Com- alth, a view which presents very great difficulties as to con- uction and as to consequences. Assuming sec. 92 does apply to Commonwealth, the Parliament under sec. 51 (1.) could not ate so as to impose restrictions on inter-State trade and is able of making it more free than "absolutely free." The mmonwealth Parliament's powers of legislation under secs. 98 and as to inter-State trade and commerce would be very meagre, though limited fields of legislation may be suggested. The Inter- e Commission would practically have no powers as to laws made y the Commonwealth. (3) Assuming that sec. 92 applies to the mmonwealth, the powers of the Parliament-to legislate under ec. 51 (vi.) as to defence would be unduly and most seriously ed. The power of legislating as to defence is as much subject ) the provisions of sec. 92 as is the power of legislating as to trade id commerce. (4) Finally, the limitations upon the words " abso- ly free " which have been suggested by counsel for the appellants d for the Commonwealth would raise extraordinary difficulties as }some of which no test has been suggested in order to enable them be determined. The suggestion that sec. 92 does not apply to the Commonwealth is inconsistent with the freedom referred to being "absolute," for the Commonwealth would have power to create any nd of horder duties so long as they were uniform as regards all the , and it would be absurd to say that trade between the States absolutely free if duties imposed by the Commonwealth Parlia- had to be paid when crossing the borders. The language of proviso to sec. 92 clearly relates to the Commonwealth, and is efore against that suggestion. If only the States were intended affected the change in language from sections like secs. 99, 100, 115 and 116 is very marked and difficult of explanation. 'ing argument reference was also made to Fox v. Robbins (1) ; v. Kirkwood (2); Attorney-General for Canada v. Attorney- ral for Alberta (3); London and South-Western Railway Co. v. _ (4); Bartemeyer v. Iowa (5); Minnesota Rate Cases (6) ;

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advised, I consider the right conferred by the provision to wholly independent of either the law-making or the executive p either of the Commonwealth or of any State. But the qi does not call for decision in this case. A suggestion was made that, inasmuch as most of the A decisions cited related only to State restrictions of goods en from another State, there was nothing in them tending tod right of a State to interfere with the transportation of commo from within it to a neighbouring State. That is not so. z instances to the contrary are to be found. One such is the ca Hall vy. De Cuir (1). Another is Ohio Oil Co. v. Indiana (2), at p. 205, the judgment mentions with approval that in Co Case, a law of Indiana was held void by the Courts of that as an interference with inter-State commerce, because it prol under penalty the conduction of natural gas beyond the A third is the case of Reid v. Colorado (3), where the Court the course of its judgment: "It is said that the defendant | right under the Constitution to ship live stock from one St another State. This will be conceded on all hands." But more precise and more apposite than any of these is the of Oklahoma v. Kansas Natural Gas Oo. (4), where it was held Statute of Oklahoma, which purported to confine the transmis of the natural gas of Oklahoma to points within that State, violation of the Constitution as an interference with the fre inter-State commerce. The Court held that natural gas be subject of commerce, and therefore of inter-State commerce, the owner of the soil had so far captured it as to conduct it in } The case is instructive not only by reason of its close relat principle to that before us, but because of the striking applical of the terms employed by the Court to the Queensland enactn on which reliance is placed. The State Attorney-General, wh in the appeal, argued that the ruling principle of the Statut "conservation, and not commerce"; and he contended ti State has the right to conserve its natural resources. The said in its judgment, delivered by McKenna J. (5): -

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Schollenberger v. Pennsylvania (1) and Collins v. New Hampshire (5 In the first case it was held that an article recognized in practice or law as an article of food and commerce could not be wholly exclud by the operation of a State law from introduction commercially that State from another State where it was manufactured. In th case the manufacture of the article (oleomargarine) within the Sta was prohibited, and so was its sale. In the second case the Stat Statute simply prohibited the sale of the same article as a sub-_ stitute for another (butter) unless it were coloured pink. As condition would make it unsaleable, the Act was held to be a p: hibition of sale. In that case the article was not manufactured within the State at all. It is thus apparent that in each case t article the sale of which was forbidden was not found within th prohibiting State unless it were introduced from some other State Tt was held in each case that the State Statute operated as prohibition of inter-State trade in the article. It was not serious contended in either instance that the article would be injurious to health of the people of the State if consumed therein. It is that in either case the transportation of such an article out of th State if produced within it could not have been prohibited or restricted without a violation of the Constitution. For the right of inter-State commerce is of course reciprocal. In Schollenberger's Case (1) Peckham J., who delivered the re ment of the Court in both instances, said that the question whether the _ substance was an article of commerce (and, as I have shown, the right of inter-State commerce belongs to the ownership of such an article) must be determined by the Court "with reference to those facts - which are so well and universally known that Courts will take notice of them without particular proof being adduced in regard to them, and also by reference to those dealings of the commercial world" which are of like notoriety " (3). In this Queensland case some ques- tion was raised as to what is an article of inter-State commerce. - The answer is supplied by this criterion. It cannot be doubted that live stock are within it, and inter-State commerce in them cannot be denied or even regulated by any State. An exception of coi

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eat Case (1), where it was held that the State of New South Wales, acquiring the wheat, which it could constitutionally do, acquired e right of determining for itself as the owner whether it would the wheat outside New South Wales, or would retain it It was the ownership which had given the previous pro- ors the right of inter-State trade, and the ownership had law- passed to the State, which necessarily had thenceforth the right 'dispose of it in any way or to retain it, just as the previous had. If, then, a State, not acquiring the ownership of a subject commerce (which is therefore a subject of inter-State commerce), umes to deprive the owner of that right so definitely secured by Constitution, the State is to that extent violating the Constitu- no matter whether it applies the term which I have quoted to eoperation or not. The distinction upon which the action of the ature of New South Wales was held valid in the Wheat Case e very distinction on which different action of that State was unconstitutional in the case of Foggitt, Jones & Co. v. New South (2). There the State had acted under sec. 5 (1) of a Meat ly Act like that now in question. That provision corresponds tly with sec. 6 (1) in the Queensland Act. This Court held that provision relied on did not constitute any authority to the nts for their action in preventing the transit of live stock e plaintiffs into Queensland. If the Wheat Case is correct, and bt has been thrown uponit, then the case of Foggitt, Jones & New South Wales is also correct, because it is the strongest ion from the decision in the former case that an interference the exercise by owners of the right of inter-State commerce ot be justified ; and that it is only when and because the right passed to a new owner that the latter can exercise his own on whether, having the right, he will exercise it or not. The tiple of the Wheat Case rests on a good foundation. But the e right arrogated in this case, even if supported by a majority s Court, rests, I firmly believe, on a foundation forbidden by » Constitution.

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| for the shipment of them or their meat, say, to India, my action 'not be expressly conditioned on the passage of the stock from to State. But who would venture to say that it is not, ever laudable its motive, the deliberate and intentional pre- on of inter-State trade? Hitherto, motives have not been as excuses for violations of the Constitution: though, if the nt decision be taken as a precedent, they may be in future. en it was argued that the operation of one or both of the sec- impeached was analogous to the " dedication" of a highway rk, although it is admitted not to be the same thing. But how n enactment to be saved by such a name? If the cattle are t dedicated, how much does the mere term convey in this case ? to the contention that the cattle have been placed in custodid is. That is a term well understood in regard to legal proceedings | their results ; but what effect can its use have in preventing lain construction of this Statute? TI fail to see its applica~ as conveying a legal effect overriding that construction. In of all-these names the question still is whether the legislative n of a State, whatever name is applied to it, interferes with te commerce in the sense that it forbids the transmission by the owner of the chattels or their value in goods or when exchanged from State to State. If it does so, it is pro ) repugnant to the Constitution. The question is still one of the y operation of the Statute. Any other principle will in authorizing the production of the forbidden effect by the e of the skilful employment of evasive words. hould mention that the defendants sought to sustain their on by resort to the case of Geer v. Connecticut (1). It was led that, like the game the subject of that case, the cattle e, by the effect of sec. 6 (1) and 7 (1), placed beyond the of commerce. But in the case cited the game were at the held to be at common law the common or collective property e State, and could therefore be retained for the State or sub- d at its will to laws imposing restrictive conditions as to sale sport. That was the result of initial State ownership, (1) 161 U.S., 519.

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reviewable by the ultimate tribunal of the Empire. There is no question here of delimitation of powers as between the Common. wealth and the States; it is a question of the actual power of either, in view of the provision of sec. 92 of the Constitution. I may say at once that Iam quite unable to concur in the conclusion arrived at _ by the majority of my learned brethren, which, I hope I may add without disrespect, is arrived at for reasons so divergent as to require separate examination at my hands. - The real question we are called upon to decide may be thus succinctly stated: "Is the constitutional declaration of inter- State freedom of trade a reality or a sham?" The Queensland Meat Supply for Imperial Uses Act has been pronounced. valid. notwithstanding that declaration, and even assuming that on the true construction of the State Act it authorizes all that is complained of. That pronouncement, which I must say at the outset is entirely irrespective of any question of war or Imperial interests, but is based on the right of any State at any time, in peace no less than during war, and to any extent it pleases, to nullify the provisions of sec. 92, necessarily reduces the Constitution, so far as it purports to guarantee to the people of Australia free trade between the States, to a worthless scrap of paper. I shall first state how the action arises, and what are the matters alleged by the plaintiffs. :

The Acts complained of. - This case came before me in original jurisdiction, and having heard all the evidence, except upon the question of amount of damages, should that become material, I formulated in all eleven questions upon that evidence, for 'the consideration of the Full Bench. The first of those questions runs thus: "Is the Queensland Meat Supply for Imperial Uses Act 1914 valid; and, if so, did it auth the acts complained of ? " The majority determination is in the affirmative; and therefore it becomes unnecessary to answer the other questions because, whatever answers were given to them, the plaintiffs fail. Conse- quently, before the answer to the first question can be properly understood, the pleadings and some of the other questions showing _ what were the acts complained of as alleged by the plaintifis must

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for New South Wales (1), I conclude the Meat Supply Act d not authorize the acts complained of, namely, preventing 1 owners from crossing their cattle into New South Wales South Australia. Still less can it authorize what is ass may have been on the facts an abuse of executive auth in the way contended for by the plaintiffs. If, however, it correct as held by the majority of my learned brethren, and shall have to assume for the next branch of the case, that it purport to authorize those acts, then, in my opinion, it is irretriey: invalid by reason of sec. 92 of the Commonwealth Constitut which I now proceed to consider. 3. Sec. 92 of the Constitution. - The first paragraph of that sectic is short and emphatic. Its words are: "On the imposition | uniform duties of customs, trade, commerce, and intercourse an n the States, whether by means of internal carriage or ocean na' tion, shall be absolutely free." The universality of this essenti covenant of the Constitution, beyond the power of Commonweal and State alike to limit, has been more than once declared by t Court. The latest instance was Foggitt, Jones & Co. v. New Soul Wales (2), in May this year, and with respect to a precisely State Act passed by New South Wales. I cannot agree with learned Chief Justice in his observation that that case was in any way hastily considered. One of the judgments was written - my own - and I refer to it at page 364 to show that the very mat r now dealt with were argued and considered. The result was th thought to be, as indeed it is, the necessary conclusion from th most carefully considered judgment in the Wheat Case (3). 1 to the judgments of the Chief Justice at p. 68, of Barton J. at p. 80 of myself at pp. 99-100, of Gavan Duffy J. at p. 105, of Powers J. p. 107, and of Rich J. at p.111. The point made was this: if o ship is transferred from one man to another, then it is only the new owner who can henceforth claim the rights of inter-State trade sec. 92 ; the former owner, having no property whatever, has not] on which sec. 92 can operate. In Fogyitt, Jones & Co.'s Case ' well considered principle was applied, and the man who was allow to retain his general ownership was held to be protected in. his: (1) (1891) A.C, 456. (2) 21 C.LR., 357. (3) 20 CLR.

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the freedom of trade. And so far as it extends to inter-State t1 it is to my mind clear to demonstration that it is a violatio sec. 92. No doubt, laying aside the Federal Constitution, the Quee Parliament could prevent any man from leaving Queensland an from taking goods out of Queensland. And sec. 107 of the stitution preserves all the former parliamentary powers, except s as are exclusive in the Federal Parliament and except such as withdrawn from the States. Now, if inter-State trade is by 92 declared henceforth to be "absolutely free," the power to fett it is directly withdrawn from the States. And it must be rem bered that the affirmative power of the Queensland Parliament tise no higher than its State Constitution, and by sec. 106 that declared to be "subject to the Commonwealth Constitution." I take Lord Selborne's words in R. v. Burah (1) to apply exa to this case, where it is said that in order to test the constituti validity of subordinate legislation the only way a Court can "is by looking to the terms of the instrument by which, affirm tively, the legislative powers were created, and by which, negatit they are restricted. If what has been done is legislation, wi the general scope of the affirmative words which give the po and i/ it violates no express condition or restriction by which power is limited (in which category would, of course, be include any Act of the Imperial Parliament at variance with it), it is n for any Court of Justice to inquire further, or to enlarge cons tively those conditions or restrictions." That, I apprehend, - clear decision of the highest authority that no such diserimen for instance, movement confined to crossing the border, can save ¢ contravention. Besides, the practical reason of the matter for such a discrimen in the present instance. A resident in the mi of Queensland has as much right to trade with South Australia as Queenslander living on the border. It cannot be that he can b prohibited from moving simply because of the locality of his oceup tion, Sec. 92 knows no such distinction, and the implied restriction is contrary to the canon Lord Selborne laid down. That princi has already been applied by the Judicial Committee to the Austra (1) 3 App. Cas., 889, at p. 904.

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without obstruction or restriction ; it does not mean that the sul jects of commerce are not to be subject to the State law as to of property. That is to say, whoever has power as owner or mort- gagee or otherwise (see sec. 4) to sell any specific cattle shall not be. obstructed or hindered from sending them across the border of his State for sale or after sale. There is to be no obstruction om restriction because of State boundaries; State boundaries are to be forgotten for the purpose of trade, commerce or intercourse, - Sec. 92 does not give any power of sale to those who have not got it _ by the laws of their State. Ifa mortgagee has a power of sale, hemay - sell across the boundary ; if he has not such a power, sec. 92 does not give it. If under the laws of the State an owner tinder twenty-one or a married woman or a lunatic has no power to sell, sec. 92 d not: give the power. If an owner of stock or other commodities has covenanted not to sell them, sec. 92 does nct release him from his covenant ; if he has given to somebody an option of purchase, that option is enforceable against him by action. In other words, trade among the States is to be " absolutely free " as to commoditi which are vendible, on the part of those who are competent to sell within their own State. If this were not the meaning, a State could not, in a case of drought, distribute seed-wheat among its farmers with a condition annexed that it should not be eaten o milled or sold - the farmers would still be able to insist on a right to sell the wheat to farmers across the State borders. Given a owner, or other person who has power to sell, and given an article which is not removed from the scope of commerce by the laws of the State, there is to be no obstruction or restriction at the boun of the State. Now, to apply these principles to the Meat Supply Act. This A (sec. 6) does not, until an order to that end is made by the Chief Secre- tary, divest the plaintiffs or the other owners of stock of the ov ship. The Act could have so enacted, could have confiscated the sto and vested them in the British Government; and if it had do so, the plaintiffs could have no possible pretence for asserti right to sell, either in Queensland or across the border. All the Act has done as yet is to declare that the stock are to be "

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licences for raising revenue for provincial purposes; yet ea municipality under a provincial Act got a handsome revenue n such licences and a Canadian Temperance Act interfered with traffic in liquor, and thereby prejudicially affected the revenue f the municipality, the Canadian Act was held to be valid (Russell The Queen (1)); and see Hodge v. The Queen (2); Attorney- for Canada v. Attorney-General for Alberta (3). As the Committee of the Privy Council said, the Canadian Act interfere with the objects and operation cf provincial Acts rovided that it was not itself legislation upon a subject assigned 1 » the exclusive jurisdiction of the provincial Legislature (4). In Attorney-General for Canada v. Attorney-General for Ontario (5) a had exclusive power as to fisheries and Ontario as to property | civil rights ; yet, although laws as to the seasons and the instru- its for fishing might very seriously affect proprietary rights, ght even practically confiscate property, the Canadian laws as to e seasons and the instruments were held to be valid. In Cushing v. Dupuy (6) it was held that the Canadian Parliament, having to legislate as to insolvency, could by a law on that subject inter- with property and civil rights in a Province. This decision was in Tennant v. Union Bank of Canada (7). The case of Attor- for Canada v. Attorney-General for Ontario (5) has also a on an argument which has been used before us, to the effect iat if the State legislatures in Australia can modify rights of property he manner of this Meat Supply Act, they may practically paralyze functions of the Federal Parliament. Their Lerdships said (8) : he supreme legislative power in relation to any subject matter lways capable of abuse, but it is not to be assumed that it will be improperly used ; if it is, the only remedy is an appeal to those by whom the Legislature is elected." In other words, the ultimate uarantee of the success of our Constitution is to he found in the al good sense of our people. :

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Counsel for the State of Queensland has taken the point that se 92 of the Constitution, in prescribing that "trade, commerce, and intercourse among the States . . . shall be absolutely free," merely forbids obstructions and restrictions of inter-State trade of the nature of customs duties or other pecuniary charges. I cannot accept this contention. It is true that sec. 92 opens with the words "On the imposition of uniform duties of customs"; but these words fix the critical date on which the Constitution shculd be in full operation, and there are no other words that could so effectually fix the date : see also secs. 88, 89, 90, 93, 94, 95. Sec. 90 made the - power of the Federal Parliament exclusive as to customs and excise duties on that date, and after that date the laws of the several - States on the subject "ceased to have effect"; so that there was _ no need of sec. 92 for the mere purpose of ending State customs - duties. The words " absolutely free," I take to mean that not only State customs duties were to cease (under sec. 90), but all State - prohibitions of imports from other States - and there were such . prohibitions (for instance, of grapes - long after the danger of phylloxera had ceased). Moreover, what is the meaning of the provision that "intercourse" among the States was to be "abso- lutely free," if the intention was merely to forbid customs duties &c, between the States? The use of the word " intercourse shows that more was meant. No doubt, "intercourse" had been held in the United States to be included under " trade and commerce" in the power for Congress to regulate trade and commerce ; but ii something more was not meant by the word " intercourse " in sec. 92 than by the words " trade and commerce," why was " intercourse" used in sec. 92 and not in sec. 51 (1.) - which confers on our Federal - Parliament the power to make laws with respect to "trade and commerce among the States"? It is to be observed that in another section, sec. 117, a limited provision as to intercourse among the

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the object of the enactment, as gathered from its terms, was to forbid or restrain it. During the argument our attention was drawn to certain other provisions of the Constitution which seemed to recognize the existence of legislative powers in the State Parlia- ments which render it necessary to limit the meaning of sec. 92 in the way suggested ; for instance, sec. 112 recognizes the right of such Parliaments to make inspection laws with respect to com- modities the subject of inter-State trade and therefore, it was said, to exclude them from the State. But it is more important to con- sider the legislative functions of the State Parliaments in gross. It is not permissible to whittle down a clear provision of the Con- stitution by an appeal to the exigency of the reserved powers of the States, but, if we find that the language of sec. 92 is amphibolous, it is permissible to consider such exigency for the purpose of ascer- taining the area of freedom. The legislative power of Parliament must vary inversely with the extent of this area. Tf no restraint may be put upon acts which constitute "trade, commerce, and inter- _ course," or upon persons engaged therein, ne Act of a State Parlia- ment can stcp a burglar flying from one State in order to sell his plunder in another, or exclude a trader seeking to introduce com- modities physically or morally poisonous. In the words of our brother Isaacs in the Wheat Case (1), "If a man had contracted - to carry a waggon-load of goods across the Murray on a certain day, it would . . . be an interference with inter-State trade and commerce to arrest the man for theft, or compel his attendance as a witness ora juryman, or to seize his horse and cart in bankruptcy or as a distress for rent." Common sense revolts at such a conclusion, and refuses to accept it. The Supreme Court of the United States, in construing the Constitution, has evolved a similar though not an_ identical dilemma, and we bave been invited t+ follow that Court in the course it has taken to escape from it. The American Con- stitution contains no provision like that of sec. 92, but it bestows on | Congress a power to deal with inter-State trade and commerce. The Supreme Court after much debate finally determined that this" power was exclusive and that the States could not legislate for th direct control of inter-State commerce, but ina long series of decisio (1) 20 C.L.R., at p. 99.

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Judgment (452 paragraphs)