James v Commonwealth [1935] HCA 38

(2) That sec. 92 of the Constitution did not bind the Commonwealth: The rulings to that effect in previous decisions of the High Court should not be reconsidered, and the demurrer should therefore be allowed.

Frederick Alexander James brought an action in the High Court against the Commonwealth. The statement of claim was, in substance, as follows : -

1. The plaintiff is a fruit merchant residing at Adelaide in the State of South Australia and carrying on business at Adelaide

_and Berri in the said State, and has carried on the like business H.C. or A.

at Adelaide and Berri for a number of years. 2. Since 1922 the plaintiff has devoted most of his time and ' attention to dealing in " dried fruits " (within the meaning ascribed to those words by an Act of the Commonwealth Parliament entitled the Dried Fruits Act 1928-1935) and in connection with, or in the course of, such dealing in such dried fruits, has grown and dried fruit on his orchard at Berri, purchased large quantities of dried fruits from other growers at Berri and surrounding districts, cleaned, graded, processed and packed dried fruits so grown or acquired by him, and sold the same partly in the Commonwealth and partly in England, Canada, New Zealand and elsewhere. Most of the dried fruit so sold by the plaintiff has been, and is, packed and sold with h registered brand " Trevarno " attached, and under that descrip- n; and his dried fruit sold under such brand has become known purchasers as indicating the plaintiff's dried fruits, grown and in South Australia. All the plaintiff's dried fruits had at time of the issue of this writ, in fact, acquired a good reputation, d he did, and does, a large business in and there has been, and ll is, a strong demand and a large sale for the said dried fruits ner alia) in New South Wales, Victoria, Western Australia and jouth Australia. _ 3. The Dried Fruits Board of South Australia is a board which as originally constituted by, or pursuant to, an Act of the Parliament of South Australia entitled the Dried Fruits Act 1924, which Act nd the Acts amending the same have now been repealed and ed by the South Australian Dried Fruits Act 1934 under which e Board is continued and the Board has at all times since gust 1928 been a " prescribed authority " under, or pursuant to, the Commonwealth Dried Fruits Act 1928-1935 and regulations. 4. In 1928 the Parliament of the Commonwealth passed the Dried Fruits Act 1928 (No. 11) which Act was amended by the Dried Fruits Act 1933 (No. 59) and further amended by the Dried Fruits Act 1935 (No. 5) and the Act (No. 11 of 1928) as amended, is now known and cited as the Dried Fruits Act 1928-1935 and is herein -Telerred to as "the Act." Regulations have from time to time been

• made by the Governor-General under the Act. The material regula

tions so made are the Dried Fruits (Inter-State Trade) Regulations (being Statutory Rules 1928, No. 91, as amended by Statutory Rules 1928, No. 135; 1930, No. 151; and 1931, No. 28), all of which | regulations were repealed by the Dried Fruits (Inter-State Trade) Regulations, being Statutory Rules 1934, No. 40, made by Governor-General on 4th April 1934, The last mentioned regulations have since been amended by Statutory Rules 1934, No. 164, and as i amended comprise the whole of the material regulations now in force under or pursuant to the Act.

5. In April 1932 the plaintiff, in the course of his business, enter into a contract in writing for the sale to one Clarton of 80 Hun Street, Sydney, in the State of New South Wales of 250 cases 70 lbs. net) of "Trevarno" brand dried fruits (being se raisins) at 6s. per dozen lbs. freight paid to Sydney in the State New South Wales. In part performance of such contract the pl tiff, on or about 23rd September 1932, placed on board the s.s. 7 at Port Adelaide aforesaid and forwarded, consigned to the sail Clarton, 50 cases of seeded raisins.

6. On 5th October 1932 and before receipt by Clarton of th fruit mentioned in the last preceding paragraph some person unknown, acting on behalf and with the authority of the Commonwealth or its prescribed authority in New South Wales, unlawfully seized and took possession of the said 50 cases of the plaintifi's dried fruits and deprived the plaintiff thereof and converted the same to the use of the defendant. On or about 5th October 1932 the saw authorized person posted or caused to be posted to the plaintif the following notice namely : -

"Form F. " Commonwealth of Australia. " Dried Fruits Act 1928. " Notice of Seizure. "State of New South Wales. "To F. A. James, Victoria Square, Adelaide.

"Take notice that 50 cases of dried fruits namely dried lexias branded EDC/S each containing 70 one pound packets consigned from Adelaide by A. H. Landseer ex s.s. Time which arrived at

the Dried Fruits Act 1928 inasmuch as a licence had not been ied under the said Act permitting the carriage of the said dried fruits. Dated at Sydney this fifth day of October 1932. Sed. (Signature illegible). Authorized person.' At the foot of the notice typed a copy of reg. 11 of the regulations, being Statutory Rules No, 91. 7. On 2ist June 1932 the plaintiff, in the course of his business, ered into a contract in writing for the sale to Messrs. H. Hooper t Co. of Sydney of 100 cases (each containing 70 Ibs.) 1932 crop, 'Trevarno " dried fruits (being seeded raisins) at 6s. net per dozen bs. f.0.b. Port Adelaide. In part performance of such contract the ntiff on 1st October 1932 placed on board the s.s. Milora at Port ide, and forwarded, consigned to the above-named H. Hooper Co., 20 cases of seeded raisins. 3. On 10th October 1932 and before receipt by Hooper & Co. of e fruit mentioned in the last preceding paragraph, some person aknown, acting on behalf and with the authority of the defendant its prescribed authority in New South Wales, unlawfully seized d took possession of the 20 cases of the plaintiff's dried fruits nd deprived the plaintiff thereof and converted the same to the ise of the defendant. On 10th October 1932 the authorized erson posted or caused to be posted to the plaintiff a notice in the form to that set out in par. 6 hereof. The dried fruits, so seized as alleged in pars. 6 and 8 have never n returned to the plaintiff but were in fact sold and the proceeds of such sale retained by the defendant. '10. In consequence of the said seizures the plaintiff has suffered

1. Since the passing of the Commonwealth Dried Fruits Act 1928 U1) the Commonwealth Minister of State for Commerce has, n time to time, purported to fix or determine a percentage or proportion of the total output of dried fruits which each holder of licence under the Act (or the Act as amended) is or shall be required, 8 a condition of his licence, to market outside the Commonwealth.

The Minister has so purported to fix or determine as aforesaid VOL, Lit. 37

Sydney on the 30th September 1932 have this day been seized as H.C. or A. forfeited to His Majesty the King on account of a contravention

H.C. or A. pursuant to the Act and regulations. Notice of such fixing or

determination has from time to time been given to the plaintiff and some notifications thereof have been published in the Commonwealth |

by the Minister is in the form and to the effect following: Dried Fruits Act 1928-1933. - Dried Fruits (Inter-State Trade) Regu- lations. - Percentage of dried fruits to be exported from Australia. Whereas by reg. 6 of the Dried Fruits (Inter-State Trade) Regulations it is prescribed that owners' licences shall be issued upon the follow conditions (among others) : - (ii) That the licensee shall export fron Australia or cause to be exported on his behalf, during the period which his licence has been issued and during such further as a prescribed authority considers necessary such percent of the dried fruits produced in Australia during any specified p which came into the possession or custody of the licensee to the date of issue of his licence or which came into the p sion or custody of the licensee on and after the date of this licence as is from time to time fixed by the Minister upon | report of a prescribed authority and notified in the Now therefore I, Thomas Cornelius Brennan a member of Executive Council acting for the Minister of State for Com and acting in pursuance of the said regulations and of a report of prescribed authority do hereby fix the undermentioned percenta; of dried fruits produced in Australia during the periods spe which come into the possession or custody of any licensee and required to be exported by him or on his behalf in accordance wi the above-mentioned conditions of his licences. Dried fruits pro duced in Australia during the period commenced on Ist Janua 1935 and ending on 31st December 1935: Per centum - currants 874, sultanas 90, lexias 75, prunes 663, peaches 70, pears 5. Dried fruits produced in Australia during the period commenci on Ist November 1934 and ending on 31st October 1935: Pt centum - apricots 60, nectarines 60. Dated this twentieth day of February 1935. - Thos. ©. Brennan. For the Minister of State for Commerce." The Minister intends that the said determination is sti Ue and should remain in force until altered by him.

plaintiff made, in the usual and ordinary course of his business, tracts for the forward sales of dried fruits (within the meaning aforesaid) to merchants residing in the various States of the Com- 'monwealth. Many of the contracts stipulated for the sale of the intiff's dried fruits under the name of '" Trevarno." Under the terms of the contracts of sale of such dried fruits to merchants in the States of the Commonwealth (other than the State of South Australia) the plaintiff was under a contractual duty, in order properly to fulfil and carry out the contracts, and each of them, ac ng to the tenor thereof, to deliver the dried fruits therein 'ively contracted to be sold by him out of his stocks in South a, at the times mentioned in the contracts, f.o.b. Port le, South Australia, and not otherwise, and most of the acts required (and it is in accordance with the plaintiff's estab- business practice) that the plaintiff should receive payment or his dried fruits against the shipping documents. The plaintiff esires and intends to continue to offer for sale and to sell in the ommonwealth further quantities of dried fruits.

13. The Commonwealth Dried Fruits Act 1928-1935 and the ations made thereunder purport to forbid the plaintiff, under pain of incurring the heavy penalties therein provided, from sending ny fruit in fulfilment or partial fulfilment of the contracts referred to in par. 17 hereof unless and until he is the holder of a licence inder the Act and regulations, by virtue of which he would become s bject to compliance with all the terms and conditions of the licence. Such terms and conditions are set out in the regulations, nd one of them purports to require that the plaintiff (if a licensee) would comply with the determination set out in par. 11 hereof.

a 14. In February, March and April 1935, the plaintiff tendered to

ellwraith McEacharn Ltd., Australian United Steam Navigation Ltd., Howard Smith & Co. Ltd. and other carriers quantities of

ial fulfilment of some of the contracts referred to in par. 17 but the shipping companies and other carriers refused and e to carry the plaintifi's dried fruits from South Australia to

12. Towards the end of 1934 and at the beginning of 1935 the H.C. oF A.

H.C. or A. one of the other States of the Commonwealth unless and until the

ee plaintiff holds a licence under the provisions of the Commonwealth

Tames Dried Fruits Act 1928-1935 and regulations, and the shipping com-

THe panies and other carriers have informed the plaintiff that they must Commo continue to refuse to carry the plaintifi's dried fruits from South

Australia to the other States of the Commonwealth unless and unt

he obtains a licence as aforesaid. In an endeavour to send some of his dried fruit from South Australia to the other States of the Com- monwealth the plaintiff has tendered same to the South Australian Railways Commissioner for carriage but was met with a like refusal on the said ground. There are no other practical means by which the plaintiff can send his dried fruits from South Australia to any of the other States of the Commonwealth, or by which he deliver his dried fruits in accordance with the terms of his inter State contracts or at all; and if there were any practical available to the plaintiff he fears that the defendant or some p scribed authority or some person on behalf of one of them seize his dried fruit and deprive him of it.

The said shipping companies and other carriers have, reason of the fear of incurring penalties provided in the Comm wealth Dried Fruits Act 1928-1935, taken out licences under the Act and regulations and they, and each of them, by reason of the fear o incurring penalties provided for in the Act and regulations, now and | for no other reason whatsoever, refuse to carry the plaintifi's dried fruits from South Australia to any of the other States of the Common- wealth.

The defendant has from time to time notified the shipping companies and other carriers that if they carry dried fruits tende for carriage by any person, not being the holder of a current licence they will incur such penalties and, from time to time, the defendant sends to such shipping companies and other carriers lists of persons who hold licences and whose fruit (and only whose fruit) may be carried without incurring such penalties. The Dried Fruits Board of South Australia as a prescribed authority under the regulations made under the Act, by its secretary and/or chairman and/or other - officer has from time to time forbidden the shipping companies

The plaintiff contends that he should not be required to take

uta licence and that the defendant has no power to, and should not,

sist on his taking out a licence as a condition of his being allowed to send his dried fruits carried from South Australia to the other

'States of the Commonwealth and that the shipping companies

ind other carriers should not be required to refuse or decline to carry

The plaintiff fears that, unless restrained by the declaration,

er or injunction of this Honourable Court, the defendant or a

ibed authority or other the Minister or officer of the defendant

il continue to act as aforesaid and prevent the plaintiff from

on his business and further that they or some one or more

hem will seize and deprive the plaintiff of his dried fruits if carried

n South Australia to any of the other States of the Common-

The plaintiff's business as a dealer in dried fruits is being

ly interfered with and his dealings with merchants in other

of the Commonwealth is in danger of being destroyed and he ly suffering heavy pecuniary loss. He is unable to further fil his inter-State contracts (mentioned in par. 12 hereof) and

e of the merchants to whom he has sold fruit as aforesaid are

tening to, and will in fact, cancel their respective contracts and

im damages from the plaintiff by reason of his failure further to

ver dried fruits to them in accordance with their respective

contracts. The plaintiff is unable to realize on his stocks of dried ruits or to enter into further contracts for the sale of 1935 season's

d fruits as he would in fact now do but for the Act and/or the

tions made thereunder and/or the acts of the defendant.

(a) that the Dried Fruits Act 1928-1935 is beyond the powers of the Parliament of the Commonwealth of Australia and therefore invalid and of no effect ;

(b) that the Dried Fruits Act 1928-1935 of the Parliament of

the Commonwealth of Australia or alternatively secs. 3

and 5 (a) thereof contravene sec. 92 of the Constitution

and other carriers to carry the plaintiff's dried fruits, he not being H.C. or A.

H. C. or A. (c) that the regulations made under the said Dried Fruits Act | ee 1928-1935 or some part or parts thereof contravene sec, James 92 of the Constitution and are invalid ; ae (d) that it is not necessary for the plaintiff to be the holder of

Seaars a licence under the Act before delivering any " dried

a fruits' (within the meaning ascribed to those words by

the Act) to any person for carriage into or through another

State or States of Australia beyond the State in which -

the delivery is made and that the plaintiff should be allowed

to send his dried fruits from South Australia to the other

companies and other carriers should be allowed to carry

the plaintiff's dried fruit without hindrance or obstruction -

by the defendant or anyone acting on behalf of the defendant

or without the plaintiff being required to take out a licen

under the Act and regulations as a condition of his

(e) that it is beyond the powers of the Governor-General

prescribe as conditions of the licences (the issue of which

is provided for in the Act and regulations) the conditions -

set out in par. 6 of the regulations being Statutory Rules"

1934, No. 40, as amended by par. 4 of the regulations | being Statutory Rules 1934, No. 164;

(f) that the determination set out in par. 11 hereof is invalid; that it is not within the power of the Minister of Commerce to make such or similar determinations; and/or that licensees under the Act and regulations should not be required to comply therewith.

(a) an order to restrain the defendant and/or the Dried Fruits Board of South Australia as a prescribed authority under . the Act and regulations and each of them, their respective agents and servants, from further obstructing the plaintiff in the shipment or sending of his dried fruit from South Australia to the other States of the Commonwealth ;

(6) an order to restrain the defendant from further interfering directly or indirectly with the plaintiff's business, and in

particular to restrain the defendant from interfering with 4-©- oF A.

and preventing (directly or indirectly) the plaintiff from fulfilling his contracts for the sale of his dried fruits from his stocks in South Australia to merchants in the other States of the Commonwealth of Australia and from deliver- ing his dried fruits pursuant to his contracts.

(a) under pars. 6 and 8 hereof, for the wrongful trespass to seizure and conversion of the plaintiff's dried fruit: Value of 50 cases each containing 70 Ibs. seeded raisins, at 5s. 6d. per doz. Ibs., £80 4s. 2d. ; bill of lading and stamp thereon, ls. Td. ; insurance, 4s. 9d. ; value of 20 cases, each contain- ing 70 Ibs. seeded raisins, at 6s. per doz. lbs., £35; bill of lading and stamp, ls. 7d.; cost of telegrams, letters and other incidentals including loss of time and expense as a result of such seizure, &c., £5 - £120 12s. 1d. ;

(6) generally, for wrongful interference with the plaintiff's business.

(4) Such further or other relief as the Court may see fit to grant- _ The defendant demurred to the statement of claim and delivered defence thereto. The demurrer was substantially as follows : - The defendant demurs to the whole of the statement of claim and says that the facts alleged therein do not show any cause of "action. A ground in law for the demurrer is that the Dried Fruits Act 1928-1935 and the Dried Fruits (Inter-State Trade) Regulations made by Statutory Rules 1934 No. 40, as amended by Statutory Rules 1934 No. 164, are valid laws of the Commonwealth of Australia and that the acts which the defendant is alleged to have done were authorized by the said Act or regulations validly made thereunder. By pars. 1 and 4 of its defence the defendant admitted pars. 1 and 4 of the statement of claim; by pars. 2, 5 to 10 and 12 to 18 the defendant did not admit pars. 2, 5 to 10 and 12 to 18 of the statement of claim. Otherwise the defence was substantially as follows :- - 3. The defendant admits that the Dried Fruits Board of South Australia constituted by the Dried Fruits Act of that State is a

H.C. or A. prescribed authority under the Commonwealth Dried Fruits Act ns 1928-1935. Save as aforesaid the defendant does not admit any of James the allegations in par. 3 of the statement of claim.

Tun 11. The defendant admits that the Commonwealth Minister of

al State for Commerce has from time to time fixed in accordance with = the regulations made under the Act the percentage of dried fruits

produced in Australia during any specified year which is to be exported by a licensee during the period for which his licence has been issued and that on 20th February 1935 a determination was made in the terms set forth in par. 11 of the statement of claim. Save as aforesaid the defendant does not admit any of the allega- tions in the said paragraph contained.

The Dried Fruits Act 1928-1935 is a valid law of the Common- _ wealth of Australia.

The Dried Fruits (Inter-State Trade) Regulations (bane Statutory Rules 1928 No. 91, as amended by Statutory Rules 1928 No, 135) were after such amendment and, as subsequently aman by Statutory Rules 1930 No. 151 and 1931 No. 28, a valid law of | the Commonwealth of Australia until repealed by the Dried Pris (Inter-State Trade) Regulations (being Statutory Rules 1934 No. 40).

The Dried Fruits (Inter-State Trade) Regulations (being Statutory Rules 1934 No. 40) and the said regulations, as amended by Statutory Rules 1934 No. 164, have at all times been and are a valid law of the Commonwealth of Australia.

The acts which the defendant is alleged to have done were authorized by the said Act and regulations.

In action No. 54 of 1928 in this Honorable Court brought by the plaintiff against the defendant and certain other persons the plaintiff claimed (inter alia) the following declarations : -

A. That the Dried Fruits Act 1928 (No. 11 of 1928) of the Parliament of the Commonwealth of Australia contravenes sec, 92 and/or sec. 99 of the Constitution and is invalid.

B. That secs. 3 (1) (a), 3 (1) (b), 3 (2), 3 (3), 3 (4) and 3 (5) and each of them respectively, and all other sections of the Dried Fruits Act 1928 which are auxiliary to such sections, contravene sec. 92 and/or sec. 99 of the Constitution and

©. That the Dried Fruits (Inter-State Trade) Regulations made H- ©. or A.

under Act No. 11 of 1928 on 29th August 1928 (being Statutory Rules 1928 No. 91), which regulations came into operation on 10th September 1928, contravene sec. 92 a and/or sec. 99 of the Constitution and are invalid.

D. That regs. 3 (1), 3 (2), 4 (a), 4 (0), 4 (0), 4 (d), 4 (0), 5 (1), 5 (2), 7 (1), 7 (2), 8, 11 (1), 11 (2), 11 (8) and 12 of the said Dried Fruits (Inter-State Trade) Regulations contravene sec. 92 and/or sec. 99 of the Constitution and are invalid.

_ 24, The defendant and one Brown, a defendant in the said action,

demurred to the whole of the statement of claim therein on the ground that the facts alleged did not show any cause of action. A nd in law of the demurrer was that the Dried Fruits Act 1928 nd the Dried Fruits (Inter-State Trade) Regulations made by Statu- y Rules 1928, No. 91 were valid laws of the Commonwealth of lia and that the acts which the defendants were alleged to done were authorized by the Act and regulations. 25, The demurrer was heard in Sydney on 29th November 1928 before the Full Court consisting of Knox C.J., Higgins, Powers and Starke JJ. and judgment thereon was given on 12th December 1928. e reasons of their Honors will be found reported in James v. The ommonwealth (1). All their Honors, as appears from a perusal of e report, decided that neither the said Act nor the regulations e invalid as offending sec. 92 of the Constitution, and that whilst Act was not invalid as offending sec. 99 of the Constitution, e regulations in their existing form did so offend by reason of e fact that whilst licences could be issued thereunder in the States of New South Wales, Victoria, South Australia and Western Aus- no licences could be issued in the States of Queensland and ia, there being no prescribed authorities in the two last- tioned States. The demurrer was accordingly overruled. 26. The amendments to the Dried Fruits Act 1928 by Act No. 59 of 1933 and by Act No. 5 of 1935, which are now embodied in the Dried Fruits Act 1928-1935, are not of a substantial character or of Such a nature as to affect the validity of the said Act.

27. The regulations referred to in pars. 20 and 21 hereof are sub-

stantially the same, so far as validity or invalidity is concerned, as those which were considered by this honourable Court in the said action, save and except that the vice found therein by their Honors as aforesaid has been eradicated.

28. By reason of the matters set forth in pars. 23 to 27 hereof the plaintiff ought not to be admitted to say that the said Act and/or the said regulations are invalid.

The defendant took out a summons for an order dismissing the - action or striking out the statement of claim on the ground that the q action was frivolous and vexatious and an abuse of the process of the Court in that the substantial questions raised therein had already : been litigated between the parties and decided against the plaintif. " The summons was referred to the Full Court and the Court order that both the summons and the demurrer be heard together.

Latham K.C. (with him Herring), for the defendant. As to th summons, the same specific question as is now before the Court h previously been litigated between the same parties and has bee determined in favour of the present defendant. The result of the previous litigation is reported in James v. The Commonwealth a). F The summons is under Order XLIV., r. 2, of the High Court Rules, i and under the inherent jurisdiction of the Court to prevent an abuse of the process of the Court. Order XLIV., r. 2, of the High Cowt ec Rules corresponds with Order XXV., r. 4, of the English Rules. - The Commonwealth Dried Fruits Act does not infringe sec. 92 of the Constitution. This action rests and depends on the very points ; which were decided adversely to the plaintiff in the former action. # The authorities relating to the matter are conveniently collected in the Annual Practice in the notes to Order XXV., r. 4, at pp. £28 and 429 of the 1935 edition. There can be no appeal to this Court by way of overruling the previous decisions and the principle that there should be an end of litigation should be maintained (Reichel v. Magrath (2) ; Stephenson v. Garnett (3) ; Hoystead v. Commissioner of Taxation (4); Broken Hill Municipal Council v. Broken Hill Proprietary Co. (5) ; Green v. Weatherill (6) ). The principle is the same whether ;

(1) (1928) 41 C.L.R. 442. (4) (1926) A.C, 155, at pp. 165, 170. (2) (1889) 14 App. Cas. 665. (5) (1922) 30 C.L.R. 400. (3) (1898) 1 K.B. 67, at p. 680. (6) (1929) 2 Ch. 213, at p. 221.

• the litigation is between private persons or whether one party isthe H.C. or A.

• Commonwealth. The plaintiff should not now be permitted to con- tend that sec. 92 of the Constitution binds the Commonwealth. The Commonwealth should not be vexed twice for the same cause of

action. There should be an end to litigation, and where the matter CO™™oN-

has been litigated and determined between the same parties, one of those parties should not be permitted to raise the same question in any other Court.

As to the demurrer, the statement of claim alleges that the Com- monwealth Dried Fruits Act is invalid because it is inconsistent with sec. 92 of the Constitution. This means that sec. 92 binds the Commonwealth. Such a contention is concluded against the 'plaintift by W. & A. McArthur Ltd. v. Queensland (1), James y. South Australia (2), James v. The Commonwealth (3) and R.v. Vizzard; Ex parte Hill (4). The action should be struck out 'as an abuse of the process of the Court, or, alternatively, the demurrer be upheld because the above cases show that sec. 92 does not ind the Commonwealth.

Ward (with him Mollison), for the plaintiff. The power to strike it is discretionary, and the Court should not exercise it without iving the plaintiff a further opportunity to be heard. The matter 'is not res judicata so far as the plaintiff is concerned (Broken Hill Municipal Council v. Broken Hill Proprietary Co. (5)). H oystead v. aaintssioner of Taxation (6) is distinguishable, as there the ques- "tion was mostly one of status (Inland Revenue Commissioners v. 'Sneath (7)). The plaintiff relies upon a completely new set of facts. The Act has been amended in a material respect and the 'Plaintiff is seeking the interpretation of a different section from the one that was previously before the Court. In James v. The Common- wealth (3) the Court did not consider the point at all. In James vy. Cowan (8) the Privy Council said that there had been conflicting decisions in this Court and left the matter open, and, therefore, the discretion of the Court should not be exercised against the plaintiff,

[Counsel referred to Fox v. Robbins (1); R. v. Smithers; Ex parte Benson (2) ; |New South Wales v. The Commonwealth (3); Duncan v. Queensland (4); R. v. Vizzard; Ex parte Hill (5); 0. Gilpin Ltd. v. Commissioner for Road Transport and Tramways (N.S.W.) (6).] If there is any conflict between sec. 51 and sec. 92, sec. 51 should be given a restricted operation.

Ricu J. delivered separate judgments in the summons and in the | demurrer as follows : -

The Summons - This is an application to stay an action as - an abuse of the process of the Court and as disclosing no rea able cause of action. The action is brought to impugn validity of the Dried Fruits Act 1928-1935. The present pla brought the action which was decided under the title Ja q v. The Commonwealth (7). He there attacked the validity of - the legislation on the same ground, namely, inconsistency with sec. 92. His action succeeded on another ground. Although the Court ruled that he was wrong upon his first ground he is not estopped, because the decision passed in his favour. He - could not appeal from the Court's ruling. It was so to speak a ruling in the air so far as he was concerned. It is now said, however, that he should not be allowed to re-litigate the question. According to - his counsel litigation commenced with the intention of carrying the a question of the validity of the Dried Fruits Act to the Privy Council. Its validity depends upon this Court's ruling that sec. 92 does not bind the Commonwealth. So far from thinking that he should not be allowed to litigate the question I think that he should be encour- aged in his intention to obtain the decision of the Privy Council upon it. There is no reason whatever to be found in the course of his

(1) (1909) 8 C.L.R. 115, at p. 127. (4) (1916) 22 C.L.R. 556, at pp. (2) (1912) 16 C.L.R. 99, at p. 117. 572, 588, 616, 624. (3) (1915) 20 C.LR. 54, at pp. 66, (5) (1933) 50 C.L.R. 30.

previous litigation to make it improper on his part to do so. It is H.C. or A

an extremely difficult and doubtful question, and even in this Court there is something to be said against the view, which I personally take, that we ought to consider it closed. It is perfectly open to the | Privy Council, where indeed it was expressly reserved (James v. Cowan (1)). In my opinion it is not the plaintifi's action but the -defendant's summons which lacks any reasonable foundation.

The Demurrer - This is a demurrer to a statement of claim. 'The statement of claim seeks relief against the operation of the Dried Fruits Act 1928-1935 and of the regulations thereunder. Unless the Commonwealth Parliament is unaffected by sec. 92 of the Constitution this legislation would be invali- dated by its provisions. So much appears to result from James Cowan (2). The fate of the demurrer depends upon the ion therefore whether, when sec. 92 declares that inter-State shall be free, it means free of State governmental inter- ence or free of State and Commonwealth governmental inter- mees. Although up to 1920 the members of this Court had expressed from time to time the view that sec. 92 operated to

trict Commonwealth and State legislative power alike, upon review of the interpretation of the section which in that year the Court undertook in McArthur's Case (3), the majority of the nembers of the Court adopted the view that Commonwealth legis- lative power was not affected by the provisions of the section. Since that decision there has been no enthusiasm displayed by the members of the Court for the conclusion that sec. 92 does not bind the Com- monwealth. Until the present case, however, the question has not een presented to the Court for definitive judicial decision. In James v. The Commonwealth (4), the Court pronounced upon the question and followed the opinion expressed in McArthur's Case (3). But it cannot be said that the decision of the question was necessary to the determination of the case. Two occasions have arisen since in which the question might have been, but was not, raised. The (1) (1932) A.C., at p. 560; 47 (2) (1932) A.C. 542; 47 C.L.R. 386.

C.LR., at p. 398. (3) (1920) 28 C.L.R. 530. (4) (1928) 41 C.LR. 442.

H.C. or A. reason why the Court has not been called upon to deal definitively

with the question is, no doubt, that the Commonwealth Parliament

has not availed itself of the freedom from sec. 92 allowed to it by McArthur's Case (1), except in the legislation now under attack - and possibly incidentally, and one may say accidentally, in the course _ of some other enactments. Indeed, in Vizzard's Case (2) the Com- - monwealth intervened with the object of securing an interpretation

narrowing the freedom from State interference, and to that end - boldly argued that the Commonwealth must be held bound on the terms of the provision notwithstanding McArthur's Case (1). The

small value placed by the Commonwealth upon the judicial emancipa-_ tion from sec. 92 which it enjoys under the McArthur decision (1) is a Sasi Sse which pees weigh in a less serious question in ;

eset a interpret this section of the Ooncuteeen the Court has adopted an interpretation and declared, it is h meals: that the Court should aes from it. The | tendency

has produced results which confirm the truth of this remark. ae 6. my opinion we should hold, quite independently of our individual _ opinions, that the Commonwealth is not bound by sec. 92. An appeal lies to the Privy Council without any certificate under sec. 74. The reasons given in the Privy Council in James v. Cowan (3), and perhaps more at length in the judgments of myself and Dizon J. in Ex parte Nelson (No. 2] (4), for the conclusion that sec. 92 raises no question inter se apply equally well to the case of the Commonwealth - e as to that of the State. The plaintiff in the present case can there- fore carry the matter to the Privy Council. If their Lordships are willing to undertake the interpretation of sec. 92 in relation to any of the transport cases it will be satisfactory for them to pronounce upon this question also. In this Court it has even been found possible to disregard the question whether the Commonwealth is bound in deciding over what area of subject matter the freedom from State interference guaranteed by sec. 92 operates. The demurrer should be allowed.

(1) (1920) 28 C.L.R. 530. (3) (1932) A.C, 542; 47 C.L.R. 386. (2) (1933) 50 C.L.R. 30. a (1929) 42 €.L.R. 258.

Srarxe J. The plaintiff in this action seeks a declaration against H.C. or A.

the Commonwealth that the Dried Fruits Act 1928-1935 and regula- 'tions made thereunder contravene the provisions of sec. 92 of the Constitution, and are therefore invalid. The action is competent, according to the decisions of this Court, under sec. 75 (11.) of the 'Constitution (The Commonwealth v. New South Wales (1); Attorney- General (Vict.) v. The Commonwealth (2) ; 'cf. Monaco v. Mississippi 8 ). The Commonwealth issued a summons, seeking an order that 'the action be dismissed or the statement of claim struck out, and it also demurred to the statement of claim. The summons was founded upon the provisions of Order XVII., r. 30, and also upon the inherent jurisdiction of the Court.

The decision in James v. The Commonwealth (4) operated, it was

ested, as an estoppel of judgment against the plaintiff (Hoystead 'lommissioner of Taxation (5); Broken Hill Proprietary Oo. v. en Hill Municipal Council (6) ). But upon examination it will be

e demurred to the statement of claim, but the demurrer was led, and by a consent order the Commonwealth was dismissed from the action.

Amore formidable objection is that the statement of claim discloses 'no reasonable cause of action, having regard to the opinions and decisions of this Court in W. & A. McArthur Ltd. v. Queens- land (7) and James v. The Commonwealth (4). In McArthur's Case (7) it was said that "the true office of sec. 92 is to protect inter-State trade against State interference, and not to affect the legislative power of the Commonwealth " (Knox O.J., Isaacs and Starke JJ. (8), Higgins J. (9), Rich J. (10) ). If this proposition is accepted, the basis of the plaintifi's claim falls to the ground, and the statement of claim shows no reasonable cause of action. But in James v. Cowan (11) the Judicial Committee said that the question "will remain for them an open question." And in R. v. Vizzard ; Ex parte Hill (12), Gavan Duffy C.J., Evatt and McTiernan

(1) (1923) 32 C.L.R. 200. (7) (1920) 28 C.L.R. 530. (2) Ante, p. 533. (8) (1920) 28 C.L.R., at pp. 556-558, (3) (1934) 292 U.S. 313; 78 Law. (9) (1920) 28 C.L.R., at p. 562.

Ed. 1282, (10) (1920) 28 C.L.R., at p. 569. (4) (1928) 41 CLLR. 442, (11) (1932) A.C. 542, at p. 560; 47 (5) (1926) A.C. 155. C.LR., at p. 398. (6) (1926) A.C. 94. (12) (1933) 50 C.L.R. 30.

H.C.or A. JJ, denied the proposition, despite the fact that Evatt J. had, i

Huddart Parker Ltd. v. The Commonwealth (1), stated that proposition was an accepted thesis. Again, in O. Gilpin Led. vy. Commissioner for Road Transport and Tramways (N.S.W.) (2), Dizon J. stated that he was not satisfied that the proposition was correct, though prepared to act upon it. Long before these cases, various Justices had expressed opinions that sec. 92 bound the Commonwealth and the States alike, but the point was not, I think, the subject of argument until the year 1916, when, in Duncan v. Queensland (3), the Commonwealth submitted that the section was a limitation upon the powers of the States to resti inter-State trade. The point was expressly reserved, though Chief Justice and other Justices, as then advised, could see no sor reason for so limiting the construction of sec. 92. The argumer in that case are worth attention. The question was again argued 1920 in McArthur's Case (4); and its reaction upon the propel interpretation of sec. 92 led in that case to "a closer examination of this question than any previous occasion upon which the Court" had "considered it,"' with the result that five Justices concur in the proposition already stated. The summary power of dismi the action and striking out the statement of claim in the p case should not, in these unusual circumstances, be exercised. The plaintiff should be allowed to pursue his action to a final decision, - in this Court or elsewhere. ; The demurrer remains for consideration. It was hardly denied that, having regard to the decision of the Judicial Committee in James v. Cowan (5), the provisions of the Dried Fruits Act 1928- 1935 passed by the Commonwealth Parliament, and the regulations thereunder, contravened sec. 92 of the Constitution if the provisions of that section applied to the Commonwealth as well as to the States. It was suggested that the Court should reconsider McArthur's Case (4), and the proper interpretation of sec. 92 of the Constitution. It is, of course, open to this Court to reconsider its decisions (Aus: tralian Agricultural Co. v. Federated Engine-Drivers and Firemen's Association of Australasia (6); The Tramways Case (No. 1] (re

(1) (1931) 44 C.L.R. 492, at p. 522. (5) (1932) A.C. 542; 47 C.L.R. 386. (2) Ante, p. 189. (6) (1913) 17 C.L.R. 261, at pp- (3) (1916) 22 C.L.R. 556. 274 et seq.

Amalgamated Society of Engineers v. Adelaide Steamship Co. (1); H.C. oF A.

Medrthur's Case (2); Seaton v. Horton (3)); and it has done so in exceptional cases, e.g., where decisions of the Court were in 'opposition to the principles laid down by the Judicial Committee, or to the decisions of the Court of Appeal, or to its own decisions. We heard a full argument, however, upon the proper construction of sec. 92in R. v. Vizzard; Ex parte Hill (4), but the Court did not depart from the proposition established in McArthur's Case (2) despite the opinion to the contrary of the Chief Justice and Evatt and McTiernan JJ. No other result could or should be expected in

the present case. _ But there is another good reason for refusing to reopen McArthur's (2). Both the Commonwealth and the States, acting upon that e, have enacted legislation which, but for the decision, might be nto question. Some of this legislation is referred to in McArthur's lase (2). A more recent illustration is the Dried Fruits Act here nder discussion. And there is other similar legislation. Further, ollective marketing of goods and competition between railway and : otor services have assumed national importance in Australia, and D ant decisions have been given in this Court upon legislation g such matters and the relation of sec. 92 to that legislation ; Arthur's Case (2) is at the base of these decisions. Reconsidera- of it could not be limited to the mere question whether sec. 92 extends to the Commonwealth, for the determination of that question. st, as Higgins J. said in McArthur's Case (2), have a reaction upon the true meaning of sec. 92 and its limitation of legislative and other powers in Australia. The case has been acted upon for so long that this Court should now treat the law as settled. Its review should e undertaken, if undertaken at all, by the Judicial Committee. 'The demurrer should therefore be allowed.

demurrer as follows : - The Summons. - This is a summons under Order XLIV., r. 2, stay the plaintiff's action. The summons was referred to the

(1) (1920) 28 C.L.R. 129. (3) (1926) 38 C.L.R. 240. (2) (1920) 28 C.L.R. 530. (4) (1933) 50 C.L.R. 30.

Full Court in view of the fact that the defendant, the Commonwealth, had demurred to the statement of claim. The action is brought bya fruit merchant who desires to resist the operation of the legislation embodied in the Dried Fruits Act 1928-1935 of the Commonwealth and in the regulations thereunder. The substance of his case is that the legislation is inconsistent with sec. 92 of the Constitution and therefore void.

In 1928, the same plaintiff brought an action against the Common- wealth in which he complained, first, that the Dried Fruits Act 1928 and the regulations thereunder were inconsistent with sec. 92 of the _ Constitution and therefore invalid, and second, that the regulations were inconsistent with sec. 99 of the Constitution and therefore invalid. The Commonwealth demurred to the plaintifi's statement - of claim in that action. The demurrer was overruled upon the - ground that the regulations were contrary to sec. 99 and altogether - void. The Court expressed the opinion however, and in that sense - decided, that sec. 92 did not bind the Commonwealth and that for this reason the first ground of the plaintiff's attack upon the legis- lation failed. After the demurrer the action, so far as it affected - the Commonwealth, was disposed of by an agreement between the parties, part of which was given effect to by a consent order dis- missing the Commonwealth from the action. The order did not affect the plaintifi's rights which he now seeks to litigate. The proceedings upon the demurrer are reported (1).

The present action is instituted, as we are informed, with the view of carrying to the Privy Council the question whether sec. 92 binds the Commonwealth. The ruling of this Court that it does not bind the Commonwealth is open to very serious question, and it may be surmised that if the plaintiff had not won his case upon the second ground in 1928 he would or might have carried his first ground to _ the Privy Council in that litigation. It is said on the part of the Commonwealth in support of the application to stay this action that - the plaintiff is seeking to re-litigate a question decided against him and therefore that his proceeding is an abuse of process and oppressive and should be stopped in limine. In one sense it is true that the question was decided against him. He submitted the contention

to the Court which announced an opinion that he was wrong; but H.C. or A.

• that opinion was not translated into a decree or order and could not 4 be, because upon an independent contention he succeeded. There _ was no judgment from which he could seek special leave to appeal, none which estopped him. We were informed that his counsel were not permitted to argue the question because it was considered to be covered by the opinion of the majority of the Court expressed in McArthur's Case (1). I am quite unable to understand why in 'these circumstances the plaintiff should not be permitted to prose- ute the action. It appears to me a perfectly proper proceeding instituted for the object of obtaining a final decision upon the validity of legislation by the operation of which the plaintiff is gerieved. The summons should be dismissed with costs.

4 The Demurrer - This is a demurrer to the plaintiff's statement of The substantial question is whether the Dried Fruits Act 1935 and the regulations thereunder infringe upon sec. 92 of the s It was not denied before us, although perhaps it was

"no ad that having regard to the decision of the Privy Council in James v. Cowan (2), the legislation would be inconsistent with see, 92 if that provision bound the Commonwealth. For many it was considered in this Court that sec. 92 did bind the Com- 'monwealth (see Fox v. Robbins (1909) (3), per Isaacs J.; R. v. jithers ; Ex parte Benson (1912) (4), per Isaacs J.; New South Wales y. The Commonwealth (1915) (5), per Griffith C.J. (6), per Barton J. (7), per Isaacs J. (8), per Gavan Duffy J. (9); Foggitt, lones & Co. v. New South Wales (1916) (10), per Isaacs J.; Duncan V. Queensland (1916) (11), per Griffith C.J. (12), per Barton J. (13), per Isaacs J. (14) ). But, in McArthur's Case (1920) (15), per Knox €3., Isaacs and Starke JJ. (16), and, per Higgins J. (17), the contrary view was expressed. The case related to legislation of

(1) (1920) 28 C.L.R. at pp. 556-558. (10) (1916) 21 C.L.R. 357, at p. 365. (2) (1932) A.C. 542; 47 C.L.R. 386. (11) (1916) 22 C.L.R. 556.

(3) (1909) 8 C.L.R., at p. 128. (12) (1916) 22 C.L.R., at pp. 572, 573. (4) (1912) 16 C.L.R., at p. 117. (13) (1916) 22 C.L.R., at pp. 593, 594.

a) 913) 20 C.LR. 54. (14) (1916) 22 C.L.R., at pp. 616 and (6) (1915) 20 C.LR., at p. 66. 620. 47) (1915) 20 C.L.R., at p. 79. (15) (1920) 28 C.L.R. 530.

(8) (1915) 20 C.LR" at pp. 95, 100. (16) (1920) 28 CLLR, at pp. 556.558. (9) (1915) 20 C.L.R., at p. 105. (17) (1920) 28 C.L.R., at p. 563.

H.C. or A. a State, but the opinion was stated as part of the reasoning by which

the Court arrived at an interpretation of sec. 92. In James y. - The Commonwealth (1928) (1), the Court again expressed the opinion _ that the Commonwealth was not bound by sec. 92. As the Court decided the proceeding then before it on another ground, it may not have been necessary in strictness to pronounce upon the question; but, however that may be, the Court did in fact doso. In Huddart Parker Ltd. v. The Commonwealth (1931) (2), the validity of regulations under - Commonwealth legislation was upheld, although if sec. 92 bound the Commonwealth they were open to attack under that provision; attack which would have required very serious consideration. No such attack was made, and the case was decided upon the basis that sec. 92 ought not in this Court to be considered as bindi the Commonwealth. The question was referred to by Evatt J. (3). In Victorian Stevedoring and General Contracting Co. Pty. Ltd. Meakes v. Dignan (1931) (4) similar regulations were uph the same way. In R. v. Vizzard; Ez parte Hill (1933) (5), Duffy C.J., Evatt and McTiernan JJ. expressed their disapprov of the view that sec. 92 did not affect the Commonwealth. In O. Gilpin Ltd. v. Commissioner for Road Transport and Tramwa (V.S.W.) (6), I considered it desirable to express my own % views upon the vexed question of the manner in which sec. 92° operates in reference to the States. Having done so, I ended my judgment with the following statement : - " It is because of these facts that I have thought it desirable to consider the present case independently of authority. In doing so, I have assumed that the - Commonwealth is bound by sec. 92. While I recognize the strength of the considerations which led to the decision to the contrary, I have 4 never felt satisfied that they sufficed to raise a necessary implication limiting the application of the provision to the States. Although quite prepared to follow the decision of the Court in James v. TheCom- monwealth (1), that the Commonwealth is not bound, I have not in this or previous cases based any affirmative reasoning upon it " (7).

(1) (1928) 41 C.L.R. 442, (5) (1933) 50 C.L.R. 30, at pp. 47, (2) (1931) 44 C.L.R. 492. 88 and 98. i (3) (1981) 44 C.L.R., at p. 522. (6) Ante, p. 189.

the two views taken in these divergent authorities. It appears to 'me that the Court, as a Court, has twice declared the law to be that sec. 92 does not bind the Commonwealth, and has done so on ions when its declaration, although not absolutely necessary for the decision of the case, was highly relevant to the matter in hand. Thereafter it twice acted as a Court upon the assumption, hough almost sub silentio, that this declaration bound the Court to such a construction of sec. 92. Notwithstanding my individual opinion, which I stated in Gilpin's Case (1), I think the Court should eat the question as governed by the rulings to the contrary and hold that sec. 92 does not bind the Commonwealth.

_ Judgment upon the demurrer should be given for the defendant.

Eyarr anp McTiernan JJ. delivered separate judgments in the 'summons and in the demurrer as follows : - _ The Summons. - This is an application to stay the action brought the plaintiff in order to prevent the enforcement against him of certain Commonwealth legislation and regulations and terminations made pursuant thereof. The claim of the plaintiff is based upon the contention that the Dried Fruits Acts and ations are inconsistent with sec. 92 of the Constitution. To plaintiff's statement of claim the defendant Commonwealth has urred, but it also contends that, by reason of the previous action ween the same parties in the year 1928, the present action should stayed altogether. __ In the previous action, however, the plaintiff actually succeeded in having overruled the Commonwealth's demurrer to his then 'statement of claim, and the Court held that the regulations passed. under the Dried Fruits Act then in force gave such a preference to one State over another State of the Commonwealth as was inconsis- tent with sec. 99 of the Constitution. And although the Court expressed the view that the Commonwealth Legislature was unaffected by the provisions of sec. 92, it appears from the judgment of Higgins J. (2), that, in the absence of a Full Bench of Justices, it was deemed undesirable to permit any reconsideration of the pronouncement in McArthur's Case (3) that the Commonwealth _ was not bound by sec. 92.

In deciding this demurrer, we are called upon to choose between H- ©: oF A

The previous decision of the Court, therefore, in James y. The Commonwealth (1) does not estop the plaintiff from litigating the - question whether sec. 92 invalidates the present legislation and regulations as to dried fruits, by means of which the Commonwealth j is from time to time renewing and perfecting its control over the marketing of dried fruits, not only without, but also within, the Commonwealth.

As will appear from our judgment upon the demurrer to the state-_ ment of claim, a clear majority of the present Justices of the Court have expressed their individual opinions that the Commonwealth is _ bound by sec. 92, and the plaintiff is now desirous of obtaining a : final decision upon that question from the Privy Council, which took occasion to announce in James v. Cowan (2) that, for it, the question - whether the Commonwealth was bound by sec. 92, would remain - an open question. i There is no reason whatever for staying the action and the summons _

instituted for that purpose should be dismissed with costs. q

The Demurrer - This is a demurrer to the statement of aim of a South Australian trader who alleges that the Commonwealth, acting under the Dried Fruits Acts and regulations, but contrary to sec. 92 of the Constitution, is preventing the marketing of the plaintiff's fruit in the other States of the Commonwealth. The - plaintiff lends point to his general claim for relief by referring to the seizures set out in pars. 6 and 8 of the statement of claim, and also to his being prevented from disposing of his fruit in the other States, as alleged in par. 14.

At the time of the two seizures - October 5th and 10th, 1932 -

te the Commonwealth legislation in force consisted of the Dried Fruits

Act, No. 11 of 1928, and the regulations made in pursuance thereof - (Statutory Rules, No. 91 of 1928, No. 135 of 1928, No. 151 of 1930, and No. 28 of 1931). This legal position was altered by the Act No. 5 of 1935, sec. 3 of which provided that any regulations made under the 1928 Act and any licences issued or action taken under such earlier regulations should be deemed as effectual as if the 1935 Act itself had been in force when the prior regulation was made.

(1) (1928) 41 C.L.R. 442. (2) (1982) A.C, 542; 47 C.L.R. 386.

Doubts appear to have arisen as to whether an owner carrying his _ own fruit inter-State infringes the Act (1928 Act, sec. 3 (1) (a) and 3 (1) (6)). It was also possible that questions might arise as to whether two licences had to be applied for under the 1928 Act (see sec. 3 (1) ), and whether, in the case of an owner's licence, the Governor-General was empowered to fix the terms and conditions thereof.

At any rate, it is clear that, in October, 1932, by reason of the 1928 Act and regulations, construed by reference to sec. 3 of the 1935 Act, the owner of dried fruit was prevented from marketing any dried fruit inter-State, except upon the terms and conditions

prescribed, such conditions including conditions as to the export of dried fruit from Australia by the applicant for a licence (secs. 3 (4), 3 (5), and 5 (a) ). The fixing of the quota of fruits to be marketed outside Australia was an essential part of the Commonwealth system of control. Reg. 4 (6) of the main body of regulations (No. 91 of 1928), compelled the owner licensee to market outside the Common- wealth such percentage of the yearly output of dried fruits as the 'Minister determined from time to time. (See Form B of the Schedule to the regulations, and the later form prescribed by Statutory Rule No. 28 of 1931). The form of a Minister's determination appears in par. 11 of the statement of claim. Therefore, at the time of the seizures mentioned in pars. 6 and 8

• of the statement of claim, the plaintiff as an owner of dried fruits _ was unable to market such fruit in the other States of the Common- wealth without procuring a licence, and, if he did procure a licence, he was required to submit to a governmental determination as to the quantity of his fruit which was to be marketed overseas. In such a case, as was pointed out by Lord Atkin in James v. Cowan (1), the owner is prevented from selling inter-State more than a limited quantity of his goods. In the South Australian legislation discussed in James v. Cowan (1), the States' scheme of control was carried out in order to secure the "* prevention of the sale " inter-State of " the
• balance of the output " (2), and so as to " prevent persons in South Australia from selling more than the fixed quota in any of the Australian States "' (3). (1) (1932) A.C. 542; 47 C.L.R. 386.

H.C.orA. - Tt is clear that the object and effect of the Commonwealth's present aH system of control of dried fruit is substantially the same as that of : James the State of South Australia, which was held to be contrary to sec, _

oy 92. It may be noted that the introduction of carriers' licences by J

THE the Dried Fruits Act and regulations is no part of a scheme for

Evait J facilitating and regulating (tanec In the transport or carriage

MeTiernan J. as such the Commonwealth is in no way interested, and they a dealt with merely as incidental to the main purpose - that of prohibiting and limiting the marketing of the fruit inter-State.

This position existed at the time of the seizures mentioned in pars,

6 and 8 of the statement of claim, and also at the time referred to in par. 14 of the statement of claim, when the plaintiff's marketing inter-State was prevented. At the latter time, the regulations contained in Statutory Rules No. 40 and No. 164 of 1934 were in force. Reg. 6 (b) (ii.), as amended by reg. 4 of Statutory Rule No. 164 of 1934, and Form B of the schedule to the rules, that the system of control is being rigidly maintained.

It is clear that the Commonwealth's legislative and executive authority is being used to enforce a definite policy of limiting and prohibiting the marketing of dried fruits in the various States ye , the Commonwealth. That policy constitutes an infringement of - ; the rule of absolute free trade among the States which is stated in - sec. 92 of the Constitution, and the plaintiff would therefore be entitled to relief unless the Commonwealth be immune from the

operation of sec. 92. In our opinion there is no real ground for attributing to it any such immunity.

In the history of the Australian Constitution and of this Court, - the first occasion when it was even suggested that the Commonwealth was not bound by sec. 92 was in September 1916, during the argu- ment of the case of Duncan v. Queensland (1). There counsel contended that the Commonwealth was not bound " because any other interpretation would place the taxation of inter-State transac- tions in trade beyond the powers not only of the States but also of the Commonwealth, which would be unreasonable " (2).

At that time the argument met with scant success, Isaacs J., who had never underestimated the extent of Commonwealth authority

(1) (1916) 22 C.L.R. 556. (2) (1916) 22 C.LR., at p. 563.

A s were entitled freely to market their goods inter-State "unhindered by any interference of Commonwealth or State" (1). e also stated that sec. 92 was "one of the fundamental pacts of the Constitution under which we live "' (2), and he remained quite nimpressed by the theory that if the Commonwealth were bound by sec. 92, it would become unable to legislate " with respect to " trade and commerce under sec. 51 (1). On the contrary, he considered that the Commonwealth, though bound by sec. 92, ould still possess under sec. 51 (1) "a very large field for legislation vith respect to inter-State trade and commerce " (3). _ The argument advanced in Duncan's Case (4) involved a petitio incipii because it assumed a very wide - indeed an absurdly wide - interpretation of sec. 92, and the precise interpretation of sec. 92 the only question in dispute. 'Prior to Duncan's Case (4) not a single Justice expressed a doubt s to the application of sec. 92 to the Commonwealth. In 1909 Isaacs J. declared that sec. 92 was " not capable of being modified or weakened in any degree by any Parliament, whether Common-

ealth or State," and added that in this respect the Commonwealth Constitution differs from that of the United States (Fox v. Robbins (5)). Three years later, in 1912, the same Justice stated that the guarantee of inter-State freedom under sec. 92 was "an absolute rohibition on the Commonwealth and States alike" (R. v. Smithers ; Ex parte Benson (6) ).

During the war of 1914-1918, the continual exercise of its lefe e powers brought the legal authority of the Commonwealth greater prominence. Yet in the New South Wales v. The

mmonwealth (Wheat Case) (7), which was decided in March, 1915, no member of the Court considered that sec. 92 did not apply as a general rule of the Constitution. In that case, Griffith C.J. said the provision was " equally binding upon the Commonwealth yy the States" (8). Barton J. thought that the tenor of the

mmand of sec. 92 prevented those entitled to its benefit from

(1) (1916) 22 C.LR., at p. 620. (5) (1909) 8 C.L.R., at p. 128. (2) (1916) 22 C.L.R.) at p. 605. (6) (1912) 16 C.L.R., at p. 117. (3) (1916) 22 ©. . 618. (7) (1915) 20 C 4.

at p. (4) (1916) 22 CLR 556" (8) (1915) 20 C.LR., at p. 66.

H.C. or A. being interfered with "on the part of Commonwealth, or State, or any other authority or person" (1). Isaacs J. said : " That section, James as I have stated in Fox v. Robbins (2) and R. v. Smithers (3) is an

THE absolute limitation on the powers which either Commonwealth or Common-

Wrath, States alike would otherwise have" (4). A similar view was re expressed by Gavan Duffy J. (5).

McTiernan J. 'Thus, until the war period, the application of sec. 92 to the Commonwealth as well as to the States had always been considered foundational to our Federal system.

The history of the Federal movement goes back much further than is generally supposed, a Committee of the Privy Council stating in its report in the year 1849 on a proposal to federate the then

" The division of New South Wales into two Colonies would further aggravate this inconvenience, if the change should lead to the introduction of three entirely distinct tarifis, and to the consequent necessity for imposing restrictions and securities on the import and export of goods between them. So great, - indeed, would be the evil, and such the obstruction of the inter-Colonial trade, - and so great the check to the development of the resources of each of these Colonies, that it seems to us necessary that there should be one tariff common to them all, so that goods might be carried from the one into the other with the same absolute freedom as between any two adjacent counties in England" (see Grey, Colonial Policy of Lord John Russell's Administration (1853), vol. ty p. 450). (Italics are ours.)

In their work on the Constitution Quick and Garran stated in reference to sec. 92: " This mandate, in favour of the freedom of inter-State trade and commerce, is as binding on the Federal Parliament as on the States" (Annotated ' Constitution, (1901), p. 945). The view of Quick and Garran accords with that of the Canadian constitutional writer, A. H. F. Lefroy (Law Quarterly Review, vol. 15, pp. 291, 292). In the year 1920, however, this Court, although dealing with a

case between a corporation and the State of Queensland, in which - the Commonwealth did not even intervene, expressed the opinion, Gavan Duffy J. dissenting, that the Commonwealth was not bound by sec. 92. The Justices did not attempt to explain the earlier

expressions of opinion in the contrary sense. The essence of the

(1) (1915) 20 C.L.R., at p. 79. (3) (1912) 16 C.L.R. 99. id (2) (1909) 8 C.L.R. 115. (4) (1915) 20 C.L.R., at p. 95-

reasoning of the majority of the leading judgment (Knox O.J., Isaacs and Starke JJ. is as follows :

" Sec. 92, if it applied to the Commonwealth, would, in our opinion, practically nullify sec. 51 (1) altogether, and render impossible such measures as the Australian Industries Preservation Act, the Secret Commissions Act, the Sea- Carriage of Goods Act, and exclusive provisions in the Post and Telegraph Act, so far as they relate to inter-State transactions " (1).

But it is clear that this reasoning rests upon the prior assumption that, upon its proper construction, sec. 92 will nullify all laws which regulate or control in any degree the manner in which either all trade and commerce or trade and commerce among the States is to conducted or permitted. Yet, as Gavan Duffy J. pointed out,

"no civilized nation has ever tolerated a trade or commerce, whether foreign or domestic, which was not subject to regulation and control both with respect to the method of carrying it on, and the general conduct of those who carried it on" (2). .

_ In our opinion, it is not right to assume that such Acts of Parlia- nt as were mentioned by Knox C.J., Isaacs and Starke JJ., jough they operate with respect to trade and commerce among e States, would be "rendered impossible" if sec. 92 applied to e Commonwealth. The Secret Commissions Act, for instance, ely punishes corrupt conduct in relation to the procuring of

in relation to contracts providing for the inter-State marketing of goods. But, in our opinion, such an Act does nothing to deny that bsolute freedom of trade which is postulated by sec. 92.

'The Australian Industries Preservation Act aims at repressing all ttempts to monopolize inter-State trade where the public will be

_ The Sea-Carriage of Goods Act certainly regulates the relationship between consignor and carrier in the inter-State trade, but whether such an Act should be held to offend against sec. 92 would seem to depend upon the degree of relationship between mere transport and carriage on the one hand, and the inter-State marketing on the other, for, as Lord Farrer pointed out, though carriage, like agency and brokerage, is necessary for the operation of trade, it is a sub- sidiary element of it (The State in its Relation to Trade, Farrer and

(1) (1920) 28 C.L.R., at p. 558. (2) (1920) 28 C.L.R., at p. 568.

Griffen, (1902) p. 29), much the same view being expressed recent by Sir H. C. Gutteridge, when he emphasized that buying and sellir were the essential elements of international commerce, and carrii like insurance and finance, was only ancillary to the main purpo of the interchange of goods (British Year Book of International (1933) p. 77).

The same comment applies to the monopolizing by the Common- wealth of the postal and telegraph services. They set up regulations which affect trade, including inter-State trade. We fail to see how they could be thought to infringe sec. 92. i

We are not concerned to debate the actual decision of the Court in McArthur's Case (1), which may in some respects understate the full operation of sec. 92 (Vacuum Oil Co. Pty. Lid. v. Queensland (2); Lhe Commonwealth and Commonwealth Oil Refineries Lid. v. South Australia (3)). We would suggest, however, that the sett up of a free-trade system between organized communities is in accordance with a well-known economic doctrine and that neither the words used in sec. 92, nor the underlying doctrine they embo warrant such an interpretation as, first, resolves "' trade, comm and intercourse "' into that infinite number of acts, transactions and operations which occur in the course of it, secondly, subtracts there from that number, also infinite, of acts, transactions and operation occurring in the course of "purely domestic" trade, and thirdly - declares that the resulting remainder of the acts, transactions and - operations cannot be controlled or regulated in any way. This reasoning led to the pronouncement that sec. 92 does not bind the Commonwealth, with the consequence that the latter could law prohibitall inter-State marketing of goods and allinter-Statetrave whatsoever! In our view, sec. 92 is not accorded its true significanc if the words are analysed separately, considered in abstraction from the rest of the declaration, and the results of the analysis are subse- quently synthesized. :

Some of the difficulties of the reasoning of McArthur's Case (1) are illustrated by the subsequent decisions of this Court. These -

(1) (1920) 28 C.L.R. 530. (2) (1934) 51 C.L.R. 108. (3) (1926) 38 C.L.R. 408.

subsequent decisions were analysed by us in the case of R. v. Vizzard 3 Fe parte Hill (1). The precise situation of the Commonwealth er, did not fall to be considered in such cases, and in James The Commonwealth (2), decided in 1928, the Court did not

It was under these circumstances that Evatt J. pointed out in Huddart Parker Lid. v. The Commonwealth (4) that it was an "accepted thesis" that the Commonwealth Parliament was not

'question in Huddart Parker's Case (5), and all we need do is to point out that, if sec. 92 binds the Commonwealth, the Transport Regula- held valid in Huddart Parker's Case (5), would not necessarily infringe sec. 92, any more than the Commonwealth Acts referred to in passage from McArthur's Case (6). The illustrations of legisla- given by Evatt J. in R. v. Vizzard; Ex parte Hill (7) show that it is not every regulation of the instruments and instrumentalities of inter-State trade which sec. 92 prohibits. During the course of Vizzard's Case (8), the Commonwealth uthorities appreciated that it was desirable that the relationship between it and sec. 92 should again be considered, particularly the Privy Council had intimated in James v. Cowan (9) it the question whether the Commonwealth was bound by 92 remained for them an open question. Upon the appli- tion of the Attorney-General for the Commonwealth, under sec. Oof the Judiciary Act, this Court ordered the removal of the e from the Supreme Court of New South Wales, and the State of Victoria also intervened. In the course of the hearing before is, the Commonwealth contended, through no less an authority than Sir Robert Garran, first, that the Commonwealth, like the States, was bound by sec. 92, and, second, that the State and Commonwealth Legislatures have concurrent authority to regulate

(1) (1933) 50 C.L.R., at pp. 78-80, (5) (1931) 44 C.L.R. 492. 88.94, 100-101. (6) (1920) 28 530. 2) (1928) 41 C.L.R. 442, (7) (1933) 50 at pp. 81, 82.

(3) (1928) 41 C.L.R., at p. 458. (8) (1933) 50 C.L.R. 30. 4 (1931) 44 C.L.R., at Pi 522. (9) (1932) A.C. 542; 47 C.L.R. 386.

inter-State trade and commerce, subject to Commonwealth supremacy under sec. 109 in the case of conflicting laws, and, third, that the regulation and co-ordination of transport facilities by a State did not constitute an infringement of sec. 92, where the State regulated all its transport facilities without discrimination against inter-State transport. Gavan Duffy C.J., Evatt and McTiernan JJ. thought that the first two propositions advanced on behalf of the Common- wealth were established as correct, and Evatt J. fully discussed the ; matter of the Commonwealth's supposed immunity from sec. 92 (1). It was thought undesirable, however, that a formal ruling should be given upon the casting vote of the Chief Justice (2). Since Vizzard's Case (3) was decided, Divon J. has in Gilpin's Case (4) expressed himself as having " never felt satisfied "' that the applica- tion of sec. 92 should be limited to the States.

We are definitely of opinion that sec. 92 lays down a general rule of economic freedom, and necessarily binds all parties and authorities within the Commonwealth, including the Commonwealth itself, because, as was pointed out by the Privy Council itself, it establishes a " system based on the absolute freedom of trade among the Stat (Colonial Sugar Refining Co. v. Irving (5) ). Further, a clear majority of the present members of the Bench is of opinion that the Common- wealth is bound by sec. 92. But it has been made quite clear to the Court during the argument that, whatever decision is given, the unsuccessful party will appeal for a final determination of the question before the Privy Council. The Court has also been informed that in the pending appeal of Gilpin it is intended to canvass the rulings of this Court in Vizzard's Case (3) and Willard v. Rawson (6), which two decisions were followed in Gilpin's Case (4). Until the Common- wealth Parliament intervenes by legislation under sec. 74 of the - Constitution, the Privy Council will retain jurisdiction to deal with - these constitutional issues. If the Privy Council determines to exercise this jurisdiction in Gilpin's Case (4), the question will arise there and in the present case whether sec. 92 forbids all regulation and control of the manner of conducting inter-State trade, and

tem of absolute free trade which was always supposed to be a ional provision of the Constitution, and the obtaining of ich was one of the leading motives which led to the Federal union the Australian colonies.

If the question were free of authority, we would disallow the aurrer on the ground that the Commonwealth has no legal uthority to maintain its prohibitions and restrictions of the inter- ite marketing of dried fruits. But we think that the two cases which the majority of this Court stated that the Commonwealth nay prohibit and restrict inter-State trade should be followed, arly as Lord Atkin said that, for the Privy Council, the jon remains an open one (James v. Cowan (1) ).

_ Accordingly we agree that the demurrer should be allowed.

Demurrer allowed with costs. Summons dis- missed with costs. Set off of costs.

4 Solicitors for the plaintiff, Edmunds, Jessop, Ward & Ohlstrom.

• Solicitor for the defendant, W. H. Sharwood, Crown Solicitor for the Commonwealth.

H..D.W. (1) (1932) A.C., at p. 560; 47 C.LR., at p. 398.

"whether the Commonwealth alone is to be exempted from the general H. C. or A.