Gratwick v Johnson [1945] HCA 7

Gratwick v Johnson [1945] HCA 7 - HCA 1945 case summary — Zoe

[16]

Spender K.C. (with him Sugerman K.C. and Dignam), for the appellant. The National Security (Land Transport) Regulations together with the National Security (Shipping Co-ordination) Requla- tions and reg. 15 of the National Security (Food Control) Regulations form a comprehensive scheme for the effective use of transport throughout the Commonwealth. The Restriction of Interstate Passenger Transport Order must be read with the Land Transport Regulations under which it was made. It would be competent under those Regulations, which are an exercise of the defence power, to make an order providing that no person shall, without the necessary permit, travel by rail or by commercial passenger vehicle on any journey in excess of some stipulated minimum distance. It is nothing to the point that the Order, by par. 3, chooses journeys inter-State as specifically necessary to regulate by way of requiring a permit, because of the fact that they are the main arterial railways and the main strategic railways of the country over which trans- portation must be effected. On the wording of the Regulations and of the Order, the Order is within the defence power. The Order is not a law directed against or preventing inter-State trade, commerce and intercourse. Its real object is an exercise of the defence power, which canalizes the intercourse, and, as such, only incidentally affects it. The regulation or canalizing of transport was referred to in James v. The Commonwealth (1) and Andrews v. Howell (2). If the real purpose of the legislation, regulation or order under consideration is directed to the defence of the Commonwealth and the more effective prosecution of the war, the fact that it may refer to or include a journey which is inter-State would none the less make that incidental to the exercise of the defence power and not within s. 92 of the Constitution. State boundaries were chosen in the Order because the problem was one of transport between the States and on the strategic railway lines used in inter-State transport, which has given rise to war-time difficulties. A statute, regulation or order only comes within s. 92 if it is directed against inter-State trade, commerce and intercourse as such. In determining whether

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Maughan K.C. (with him Barwick K.C. and Seaton), for the respondent. Paragraph 3 of the Restriction of Interstate Passenger Transport Order has no connection whatever, in itself, with the defence of the Commonwealth or with the prosecution of the war. It is a prohibition against the carrying of passengers for reward from one State to another State either by rail or by commercial passenger vehicle, therefore it is concerned with intercourse between the States. It is a prohibition quite irrespective and regardless of the geographical position of the thing prohibited. The prohibition is a direct infringement of s. 92 of the Constitution. Paragraph 3 (a) has even less connection with the defence of the Commonwealth than had the regulations and conditions of approval respectively considered by the Court in Adelaide Company of Jehovah's Witnesses Inc. v. The Commonwealth (1) and Shrimpton v. The Commonwealth (2). Although it cannot be disputed that the Commonwealth Parliament and the Governor-General as its deputy have the right to make laws with regard to transport so far as concerns anything connected with the defence of the Commonwealth, that does not give them the power to make a statute, regulation or order in any terms whatso- ever if the particular statute, regulation or order so made has no connection whatever with the defence of the Commonwealth, or the prosecution of the war. So long as such travelling would not interfere with the defence of the Commonwealth and the prosecution of the war, it would be quite wrong to prohibit people from travelling for pleasure or any other purpose lawful in itself. Upon the prin- ciples laid down in James v. The Commonwealth (3) and applied in Milk Board (N.S.W.) v. Metropolitan Cream Pty. Ltd. (4), the Order infringes s. 92. A regulation, or an order made under a regulation, cannot be made good by stating therein a necessary or desirable object if an examination reveals that that is not its purpose or object, or that it lacks the necessary nexus (R. v. University of Sydney; Ex parte Drummond (5)). The purpose or object of a statute must be gathered from its context looked at in the circum- stances. The object of the Restriction of Interstate Passenger T'rans- port Order is to prevent people from proceeding from one State to another State by the particular means of travel indicated. Here the result flowing from the Order is direct, whereas in Riverina Transport Pty. Ltd. v. Victoria (6) the result was indirect. Under the Order, the prohibition operates at the borders or " frontiers" of the States (James v. The Commonivealth (7) ), and not merely within

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trade, commerce and intercourse among the States, whether by - ©: oF A means of internal carriage or ocean navigation, shall be absolutely Ceo free. An order nisi to review this decision was obtained upon the Gparwick grounds that the magistrate was wrong in so deciding. a The National Security Act 1939-1943, s. 5, provides, inter alia, ORMOm that the Governor-General may make regulations for securing the than C.7 public safety and the defence of the Commonwealth and the terri- tories of the Commonwealth, and for prescribing all matters which are necessary or convenient to be prescribed for the more effectual prosecution of any war in which His Majesty is or may be engaged. The National Security (Land Transport) Regulations, Statutory Rules 1944 No. 49, were made under the Act. Regulation 4 provides : " The objects of these Regulations are to secure, in the interests of the defence of the Commonwealth and the effectual prosecution of the war, the control by the Commonwealth of rail and road transport and for that purpose to provide that rail facilities, equipment and rolling stock and road services and vehicles shall be subject to control, regulation and direction, and these Regulations shall be adminis- tered and construed accordingly." Regulation 7 (1) provides that: "' The Minister shall have power and authority to control, regulate and direct the transport of goods and passengers by rail or road within the Commonwealth." Regula- tion 7 (2) provides that the power and authority conferred by reg. 7 (1) "shall extend to the control, regulation and direction of - (a) any railway or road transport service" and "(d) the carriage of passengers and goods by land generally." Regulation 7 (3) provides that the Minister shall have power and authority to control all rail and road transport services and to direct the order of priority to be accorded to the carriage of specified goods, classes of goods or passengers ; to direct at what times and places and upon what terms and conditions and in what manner passengers shall be picked up for carriage by rail or road transport; and to direct on what terms and conditions contracts for the carriage of passengers and goods by such transport may be entered into. Regulation 8 provides that: '' The Minister shall have power to make such orders . . . and doall such other things as he thinks fit, for the purposes of these Regulations." The Restriction of Interstate Passenger Transport Order was made under earlier corresponding provisions and was continued in force by Statutory Rules 1944 No. 49, reg. 3, as if made under those Regulations. Paragraph 2 of the Order defines " border station " as meaning and including Albury, Broken Hill, Casino, Mildura, &c., and such other places as the Director-General of Land Transport.

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inter-State transport and which did not amount to a mere prohibition thereof. It was stated in James v. The Commonwealth (1) that certain reasoning of Hvatt J. in Vizzard's Case (2) was correct. That reasoning admitted, notwithstanding s. 92, a large amount of legis- lative control even of inter-State carriage of commodities by State transport or marketing regulations. The same degree of control by the Commonwealth is allowable, because James v. The Common- wealth (3) decides that s. 92 applies in the same sense to both Com- monwealth and States. But their Lordships proceeded to point out that the case would be different if, as was held in James v. Cowan (4), the real object of the challenged legislation was to enable restrictions to be placed on inter-State commerce. In that case, it was said by Lord Atkin (5) that even if powers were expressly granted subject to s. 92 (asin the statute then under consideration), they might rightly be used for a primary object which was not directed to trade and commerce, but, inter alia, to defence against the enemy, and that such an exercise of the power would not be open to attack " because incidentally inter-State trade was affected." These principles were applied in the Riverina Case (6), and in other cases which have since been decided in this Court. In Home Benefits Pty. Ltd. v. Crafter (7), I applied the distinction between a regulation and a mere pro- hibition of inter-State trade and commerce (8). In Milk Board (N.S.W.) v. Metropolitan Cream Pty. Ltd. (9), | endeavoured to state the principle of the decision in James v. The Commonwealth (3) in the following words : - ' One proposition which I regard as estab- lished is that simple legislative prohibition (Federal or State), as distinct from regulation, of inter-State trade and commerce is invalid. Further, a law which is 'directed against' inter-State trade and commerce is invalid. Such a law does not regulate such trade, it merely prevents it. But a law prescribing rules as to the manner in which trade (including transport) is to be conducted is not a mere prohibition and may be valid in its application to inter-State trade notwithstanding s. 92 " (10).

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was right. It is provided by s. 92 of the Constitution that trade, commerce and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free. The people of Australia are thus free to pass to and fro among the States without burden, hindrance or restriction and in James v. The Commonwealth (1) it is said that "in every case it must be a question of fact, whether there is an interference with this freedom of passage." James v. Cowan (2) and James v. The Commonwealth (3) in the Privy Council are authoritative decisions that the restriction imposed by the Order challenged in this case is such an interference, for no person may travel without a permit by rail or by commercial vehicle from State to State. But it is contended that the constitutional power to make laws with respect to defence and the National Security legislation warrant the Order and that decisions of this Court, which are collected in R. v. Vizzard (4) and Riverina Transport Pty. Ltd. v. Victoria (5) support the proposition. The constitutional power, however, is granted "subject to this Constitution" and, therefore, to the provisions of s. 92 which is a declaration of right guaranteed and protected by the Constitution (James v. The Com- monwealth (6) ). None of the cases referred to formulate " a precise and inflexible interpretation " of s. 92, but all, I think, recognize that "legislation 'pointed directly at the act of entry, in course of commerce, into the second State' " contravenes the provisions of s. 92: See Willard v. Rawson (7). And it follows that legislation pointed directly at the passing of people to and fro among the States also contravenes the provisions of s. 92. It is immaterial, as I understand the cases, that the object or purpose of the legisla- tion, gathered from its provisions, is for the public safety or defence of the Commonwealth or any other legislative purpose if it be pointed directly at the right guaranteed and protected by the pro- visions of s. 92 of the Constitution. It does not follow that legisla- tion which is not so pointed or that acts done pursuant to such legislation will not contravene the constitutional provision (See James v. Cowan (2); Peanut Board vy. Rockhampton Harbour Board (8) ), but it is enough in this case to say that the Order attacked is so pointed, and consequently is, to that extent, bad.

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observe that their Lordships, in reference to that case, were dealing' with "the conception enunciated in McArthur's Case (1) that 'free' means free from every sort of impediment or control by any organ of Government, legislature or executive to which s. 92 is addressed with respect to trade commerce and intercourse ", that freedom is postulated as attaching to every step in the sequence of events from first to last (James v. The Commonwealth (2)). It is with that conception that their Lordships did not agree, but they did agree with this passage in R. v. Vizzard (3): " Section 92 does not guarantee that, in each and every part of a transaction which includes the inter-State carriage of commodities, the owner of the commodities, together with his servant and agent and each and every independent contractor co-operating in the delivery and marketing of the commodities, and each of his servants and agents, possesses, until delivery and marketing are completed, a right to ignore State transport or marketing regulations, and to choose how, when and where each of them will transport and, market the com- modities." And then their Lordships go on to formulate their own conception of the freedom guaranteed by s. 92, namely, " free- dom as at the frontier or, to use the words of s. 112" (of the Constitution), "in respect of 'goods passing into or out of the State'" (James v. The Commonwealth (4) ). And their Lordships add that "in every case it must be a question of fact, whether there is an interference with this freedom of passage" (5). It may be that their Lordships would have reached the same conclusion in Vizzard's Case (6) as was reached in this Court by a majority of its members, but, though approving of some of the reasoning in this Court, their Lordships did not expressly or necessarily say that they approved of the decision. Indeed, it would have been necessary, I should think, for their Lordships to have examined the relevant Acts and considered their operation upon inter-State trade before reaching such a decision. The fact that the Judicial Committee refused special leave to appeal in the cases of O. Gilpin Ltd. v. Commissioner of Road Transport & Tramways (N.S.W.) (7) and Duncan and Green Star Trading Co. Pty. Ltd. vy. Vizzard (8) is also relied upon in support of the assertion that R. v. Vizzard (6) was approved in the Privy Council, but the fact is inconclusive, for their Lordships merely stated, according to the shorthand notes of the argument

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