[1993] FCA 366; (1993) 116 ALR 54

[1993] FCA 366; (1993) 43 FCR 565

Fish and Fisheries - export of prescribed goods - licensing system - abalone - export permit - whether permit properly suspended and then revoked - construction and validity of delegated legislation.

Statutes - delegated legislation - validity - criteria - reasonableness - proportionality.

Export Control Act 1982

Counsel for the Appellant: Mr. Jessup QC and Ms. Singh

Solicitors for the Appellant: Australian Government Solicitor

Counsel for the Respondent: Mr. Morcombe QC and Mr. Crotti

(2) The appellants pay the costs of the respondent.

(2) The appellants pay the costs of the respondent.

Note: Settlement and entry of Orders is dealt with by Order 36 of the Federal Court Rules.

GUMMOW J These two appeals, each by leave, were heard together. In the first matter (No. 26 of 1993) the primary Judge (O'Loughlin J) on 17 March 1993, ordered the removal of the suspension of export permit No. 2290902 ("the Permit"), which had been granted to the respondent ("Dover"). The Permit had been granted on 10 March 1993 and the decision to suspend had been made on 14 March by the second appellant, Mr Martin. He had acted in reliance upon O. 79 of the Prescribed Goods (General) Orders ("the General Orders") made under the Export Control (Orders) Regulations (S.R. 355 of 1982) ("the Regulations"). The Regulations themselves were made under s. 25 of the Export Control Act 1982 ("the Act"). There was some discussion before us as to the nature of the above order of the primary Judge. It was not stated as made "until further order", but an undertaking as to damages was given by Dover and liberty to apply was granted. In my view, the order in substance was interlocutory in character, and founded upon s. 15 of the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act"). I shortly will return to the ADJR Act.

2. In the second matter, No. 34 of 1993, the primary Judge on 23 March 1993, ordered the suspension, until further order, of decisions of the second appellant, Mr Cox, to revoke the Permit, and to reject for export by Dover 100 cartons of canned abalone, the subject of the Permit. These decisions were made by Mr Cox on 22 March 1993 in reliance upon O. 80 of the General Orders. On 22 March, the order of this Court, made 17 March, which had removed the suspension of the permit under O. 79, was still in force. On 19 March, the Full Court of this Court (Sheppard, Einfeld, Beazley JJ ) had dismissed an application for leave to appeal against the dismissal on 18 March by O'Loughlin J of an application by the present first appellant for a stay of his order of 17 March.

3. Both applications for interlocutory relief had been brought on urgently in the light of the imminent export of the canned abalone, and were dealt with by the primary Judge in ex tempore judgments.

4. Dover is the world's largest producer of canned abalone, and 95% of its product is exported. Its total gross sales to the year ended 30 June 1993 will be about $A40m. Some of the abalone which had gone into the consignment of 100 cartons of canned product, the subject of the Permit, had been received by Dover as either fresh or frozen abalone from Auslive Seafood Pty Ltd ("Auslive") whose premises are situated at Braeside in Victoria. Dover has its seat of business in South Australia. Other abalone had been received by Dover from other sources as fresh or frozen supplies. All the abalone had then been processed and canned by Dover. The 100 cartons were sold by Dover to a purchaser in Japan, for shipment from Melbourne.

5. Abalone is a valuable and limited commodity and overfishing is controlled by State legislation which establishes a quota and licence system. The first appellant, the Minister, has a general concern with the "laundering" of illegally obtained abalone through the export chain. Prices on the domestic market are about 50% less than on the export market.

6. The action taken under O. 79 and O. 80 against Dover was the result not of apprehended conscious wrong-doing by Dover, but of concern by the decision-makers at the activities of Auslive. The practical difficulty in which Dover found itself was acute. This was because it was not possible to identify which, if any, of the cans in the shipment did not contain any Auslive abalone. At most, 22% of the total contents of the shipment was Auslive abalone. The Auslive abalone was small and useful in making up weights in cans.

7. In each proceeding, there was before the primary Judge an application for an order of review under the ADJR Act. The General Orders were treated as instruments made under the Act, and therefore as decisions to which the ADJR Act applied; see sub-s. 3 (1) of the ADJR Act. The proceedings were not instituted under s. 39B of the Judiciary Act 1903. The applications were not in the form required by O. 54A of the Federal Court Rules.

8. The authority for the orders made by the primary Judge in each case was to be found in s. 15 of the ADJR Act. This provides:

"15. (1) The making of an application to the Court under

section 5 in relation to a decision does not

affect the operation of the decision or prevent

the taking of action to implement the decision

but:

(a) the Court or a Judge may, by order, on

such conditions (if any) as it or he

thinks fit, suspend the operation of the

decision; and

(b) the Court or a Judge may order, on such

conditions (if any) as it or he thinks

fit, a stay of all or any proceedings

under the decision.

(2) The Court or a Judge may make an order under

subsection (1) of its or his own motion or on

the application of the person who made the

application under section 5."

Orders made under s. 15 are interlocutory in character, in the sense that they precede the making of final orders under s. 16 to dispose of the application in question. Here, there has been no final hearing and no steps taken towards readiness for a final hearing. The 100 cartons in contention have been exported from Australia.

9. Orders which are interlocutory in nature may also be made under the more general powers in ss. 19 and 23 of the Federal Court of Australia Act 1976. The relationship between the specific provisions of s. 15 and these provisions in the statute providing generally for the powers of this Court has yet fully to be worked out; see Snow v Deputy Commissioner of Taxation (1987) 14 FCR 119 at 129 and Minister for Immigration, Local Government and Ethnic Affairs v Msilanga [1992] FCA 41; (1992) 34 FCR 169 at 181-2, 185.

10. In dealing with s. 15 of the ADJR Act, the view has been expressed in this Court that the principles which have evolved to govern the grant of interlocutory injunctions under the general law are not always necessarily appropriate in the application of that section; see the authorities collected and discussed by French J in Snow v Deputy Commissioner of Taxation supra at 129, and see also Manoher v Minister for Immigration, Local Government and Ethnic Affairs (1991) 24 ALD 405 at 408 per Lee J.

11. The parties conducted the dispute before the primary Judge (and the appeals) on the footing that the principles applicable to the grant of interlocutory injunctive relief applied by analogy to s. 15 of the ADJR Act.

12. There was before us considerable debate as to the nature and scope of the principles governing the administration of the remedy of interlocutory injunctive relief. However, in view of the conclusions I have reached as to the issues of construction and validity of O. 79 and O. 80 of the General Orders, it is unnecessary to deal with those threshold issues.

13. There are significant issues both as to the construction and alleged invalidity of O. 79 and O. 80, pursuant to which Mr Martin and Mr Cox made the decisions in question. The primary Judge did not rule, at the interlocutory level, upon those questions. Given the exigencies of time which pressed upon the Court it certainly was not his duty to attempt to do so. In Cohen v Peko-Wallsend Ltd [1986] HCA 70; (1986) 61 ALJR 57 at 59, Gibbs CJ , Mason and Wilson JJ said:

"It is not right to say that it is always the

duty of the Court on an interlocutory

application to decide a question of law upon

which the decision of the case depends. No

doubt if the question is one susceptible of

resolution without further evidence, and the

urgency of the matter does not render it

impracticable to give proper consideration to

the question, the desirable course will be to

decide it. Ultimately, however, the course

which the Court takes lies within its

discretion."

14. However, upon the appeal, both sides invited us to rule upon these issues and addressed full argument. They submitted that in the events that have happened there may be no live issue remaining, save as to costs, and that there may be no need for a final hearing at the primary level if the issues be disposed of now. It is not the function of the Court to deal with abstract or hypothetical questions, the answers to which will produce no foreseeable consequences for the parties (Ainsworth v Criminal Justice Commission [1992] HCA 10; (1992) 106 ALR 11 at 22), or to entertain appeals where there remains no live issue between the parties (Sun Life Assurance Co. of Canada v Jervis (1944) AC 111 at 114).

15. But, given the significant operation of the regulatory system in question here upon the continuing business of Dover, in addition to the live issue of costs, and given also the public interest in maintaining the efficient administration of the Department of the first appellant and the discharge according to law of duties apparently imposed upon the second respondents by that regulatory system, it would be appropriate on these appeals to deal with the issues of construction and validity of O. 79 and O. 80. In so doing, the Court should not, in my view, confine its consideration to the questions of alleged error by the primary Judge in the application of principles said to govern the administration of the interlocutory injunction. Those questions are not of primary importance, given the true focus of s. 15 of the ADJR Act, as I have indicated above.

16. It is necessary first to outline the regulatory system established by and pursuant to the Act. Section 6 obliges a person who intends to export prescribed goods, if so required by the regulations, to give notice to an authorized officer in accordance with the regulations of that person's intention and of the place where the goods may be inspected. The expression "the regulations" is defined in s. 3 as including orders made by the Minister under the Regulations.

17. Sub-section 25 (1) of the Act is in the following terms:

"25. (1) The Governor-General may make regulations, not

inconsistent with this Act, prescribing matters:

(a) required or permitted by this Act to be

prescribed; or

(b) necessary or convenient to be prescribed

for carrying out or giving effect to this

Act."

Paragraph 25 (2) (g) provides that without limiting the generality of sub-s. 25 (1), the Regulations may make provision for or in relation to, subject to sub-s. (3), the empowering of the Minister to make orders, not inconsistent with the Regulations, with respect to any matter for or in relation to which provision may be made by the Regulations. Sub-section 25 (3) states that an order shall not be made prescribing any penalty for an offence.

18. As I have indicated, the Regulations were made under s. 25. Regulation 3 thereof states:

"3 The Minister may, by instrument in writing, make

orders, not inconsistent with regulations made under

the Act, with respect to any matter for or in relation

to which provision may be made by regulations under

the Act."

Regulation 3 thus follows the terms of para. 25 (2) (g) of the Act.

19. The Act empowers the making of regulations or orders which prohibit the export of "prescribed goods" from Australia, whether absolutely or to a specified place or subject to the observance of specified conditions and restrictions. The term "prescribed goods" is defined in s. 3 as meaning goods or goods included in the class of goods which are declared by the Regulations to be prescribed goods for the purposes of the Act. The text of sub-ss. 7 (1), (2) of the Act should be set out in full.

"7. (1) The regulations may prohibit the export of

prescribed goods from Australia.

(2) Regulations made for the purposes of subsection

(1) may:

(a) prohibit the export of prescribed goods

absolutely;

(b) prohibit the export of prescribed goods to

a specified place;

(c) prohibit the export of prescribed goods

unless specified conditions or

restrictions are complied with; or

(d) prohibit the export of prescribed goods to

a specified place unless specified

conditions or restrictions are complied

with."

The width of sub-paras. 7 (2) (c) and (d) is further emphasised by sub-s. 7 (4). This makes it clear that the conditions or restrictions imposed under those provisions "may be required to be complied with in respect of matters or things not related to the prescribed goods to which they apply". It is necessary also to have regard to certain provisions in sub-s. 7 (3):

"7. (3) Without limiting the generality of subsection

(2), regulations made for the purposes of

subsection (1):

(a) may provide that the export of prescribed

goods, or the export of prescribed goods

to a specified place, is prohibited unless

a licence, permission, consent or approval

to export the goods or a class of goods in

which the goods are included has been

granted as prescribed by the regulations;

and

(b) may make provision for and in relation to:

(i) . . .

(ii) . . .

(iii). . .

(iv) the revocation or suspension of a

licence or permission that is

granted subject to a condition or

restriction to be complied with by a

person for failure by the person to

comply with the condition or

restriction, whether or not the

person is charged with an offence

against section 9 in respect of the

failure."

Section 9 of the Act makes it an offence for a person to fail to comply with a condition or restriction subject to which a licence or permission is granted under the regulations. Further offences are created by s. 8 which deals with the export of prescribed goods otherwise than in accordance with the regulations. Section 10 confers wide powers of inspection upon authorized officers, including the making of copies of any document and the searching of any premises.

20. Fish (so defined as to include abalone) are declared to be prescribed goods for the purposes of s. 3 of the Act, by O. 6 of the General Orders. For the purposes of sub-s. 7 (1) of the Act, the export of prescribed goods is prohibited unless the conditions or restrictions specified in the General Orders are complied with: O. 10. Various conditions or restrictions are spelled out in O. 11. Two of them, in 11.1 (j), (k) are that:

"(j) notice of intention to export the goods shall have

been given to an authorized officer and certified by

an authorized officer in accordance with these Orders;

(k) the exporter shall hold an export permit that has been

granted in respect of the goods in accordance with

these Orders."

The time within which notice of intention to export prescribed goods shall be given is specified in O. 68.1. The person giving the notice shall furnish various information including the place where the goods can be inspected, and the date on which they can be inspected: O. 70.1 (i), (j). There must also be provided a declaration signed by the person giving the notice that the orders that apply to the goods have been complied with and that the information contained in the notice is true and correct: O. 70.1 (t). In the present case, the orders that applied to the abalone included the Export Control (Processed Food) Orders ("the Processed Food Orders"). These had been made under the Regulations and had commenced on 18 January 1993.

21. Order 73 of the General Orders is in the following terms:

"73. Where notice of intention to export prescribed goods

has been given to an authorized officer in accordance

with order 68, an authorized officer may inspect the

goods, and, where the officer has reasonable grounds

to believe that orders that apply to those goods have

been complied with, an authorized officer shall -

(a) certify to this effect on the notice of

intention;

(b) arrange for any identification number that

appears on a container system unit to be entered

on the notice of intention where this number is

not already on the notice; and

(c) where an official mark, the design of which is

specified in Schedule 9 or 10, is applied to a

container system unit, arrange for the number of

the official mark applied to the unit to be

entered on the notice of intention adjacent to

the number of that unit."

Where a notice of intention has been certified in accordance with O. 73, no person shall alter, add to or delete information contained in the notice except in accordance with O. 74.

22. The granting of export permits is provided for in O. 75. This obliges an authorized officer to grant an export permit in certain circumstances. Order 75 states:

"75. Where -

(a) an exporter has given notice of intention to

export prescribed goods in accordance with

orders 68, 69 and 70;

(b) an authorized officer has certified the notice

of intention in accordance with order 73;

(c) no unauthorized alterations had been made to the

notice of intention; and

(d) an authorized officer does not have reasonable

grounds to believe that orders that apply to the

goods have not been complied with,

an authorized officer shall grant an export permit in

respect of the prescribed goods."

An export permit granted in accordance with O. 75 shall be valid for a period of 28 days: O. 77. In the case of the Permit, this period ran from 10 March 1993.

23. Where an authorized officer has reasonable grounds to believe that prescribed goods are not fit for export, the officer may inspect them and where there are reasonable grounds to believe that the goods are not fit for export but fit for human consumption they shall be removed from the export system in accordance with orders that apply to the goods: O. 83. Where, after inspection, there are reasonable grounds to believe that prescribed goods are not fit for human consumption, then, in certain circumstances, they may be condemned and destroyed: O. 84.

24. It is possible now to turn to the crucial provisions of the orders, O. 79 and O. 80, and to come to the first issue of construction.

"79. Where an authorized officer has reasonable grounds to

believe that -

(a) an order that applies to prescribed goods has

not been complied with; or

(b) the condition of the goods has changed;

either before or after the granting of an export

permit in respect of the goods and before the export

of the goods, an authorized officer shall -

(c) inspect the goods; and

(d) suspend any export permit that may have been

issued in respect of the goods until such time

as the inspection and any analysis of the goods

is completed.

80. Where (, following the inspection of prescribed goods

in accordance with order 79,) there are reasonable

grounds to believe that -

(a) an order that applies to the goods has not been

complied with; or

(b) the condition of the goods has changed to such

an extent that they would not be passed for

export,

the authorized officer shall -

(c) reject the goods for export; and

(d) revoke any export permit granted in respect of

the goods."

The material within the square brackets in the text of O. 80 was removed by amendment in 1986. This means that on the face of O. 80 there is no longer any direct textual link with O. 79.

26. In the case of both orders, where specified criteria are satisfied, the authorized officer is obliged to take certain action. Order 79 obliges the officer to suspend any export permit and O. 80 to revoke it. Where the same circumstances meet the criteria in both orders for action thereunder, there appears to be the paradoxical result that the authorized officer must both suspend the permit and revoke it. Counsel for the appellants submitted that the Court had to do the best it could with those provisions. However, he submitted, contrary to the submissions for Dover, that O. 80 was not to be construed as sequential to O. 79.

27. Dover's submission was that (a) where an authorized officer has reasonable grounds to believe that an order which applied to prescribed goods has not been complied with, the officer must suspend any export permit until such time as inspection and analysis of the goods was completed, (b) the officer is not as a first step, to revoke the permit, and (c) until the steps under (a) have been completed under O. 79, the authorized officer is not to reject the goods for export and revoke the permit, pursuant to O. 80.

28. The point is of some significance in the present case because, it will be recalled, the decision in respect of which the second proceeding was instituted in this Court was made on 22 March 1993 by Mr Cox after the suspension under O. 79 had been made on 14 March 1993.

29. It is true that by force of the interlocutory order of the Court made 17 March the suspension under O. 79 had been removed. But that was not a final order, and the decision to suspend the Permit had yet to be dealt with on a final basis under s. 16 of the ADJR Act. Thus, the situation at the time of the second decision of 22 March is not to be assessed on the footing that the processes envisaged under O. 79 had been completed and the further operation of O. 79 was spent. Dover submits that the action under O. 80 was premature because, in relation to the orders the subject of Mr Martin's concern, the operation of O. 79 had not been spent, and in relation to any further non-compliance with the same or other orders, no steps had been taken under O. 79.

30. The decision of Mr Martin on 14 March 1993 to suspend the Permit was expressed as made in accordance with para. (a) of O. 79. The suspension was stated to have effect "until you can identify and segregate abalone received from (Auslive) since 18 January 1993". The decision on 23 March 1993 by Mr Cox to revoke the Permit and to reject the 100 cartons for export recited the existence of reasonable grounds to believe that there had been non-compliance with certain of the General Orders and the Processed Food Orders; that is to say, reliance was placed upon para. (a) of O. 80.

31. In neither case was reliance placed upon para. (b). These paragraphs deal with change in the condition of the goods, but do so in different terms. The statement in O. 79 is that "the condition of the goods is changed, either before or after the granting of an export permit in respect of the goods and before the export of the goods . . ." In O. 80, the criterion is that "the condition of the goods has changed to such an extent that they would not be passed for export".

32. In my view, the relationship between the two paras. (b) in O. 79 and O. 80 produces the following results:

(i) If, in the first instance, there are reasonable

grounds to believe that the condition of the goods has

changed to such an extent that they would not be

passed for export, the authorized officer is obliged

to act pursuant to O. 80.

(ii) If, in the first instance, the authorized officer has

reasonable grounds to believe that the condition of

the goods has changed, either before or after the

granting of an export permit and before export of the

goods, but the reasonable grounds do not go so far as

to found a belief that the change is to such an extent

that the goods would not now be passed for export, the

authorized officer is obliged to act pursuant to O.

(iii) If, whilst a suspension under O. 79 is in force, there are

reasonable grounds to believe that the condition of the

goods now has changed to such an extent that they would not

be passed for export, then, notwithstanding the subsistence

of the suspension, the authorized officer is now obliged to

revoke the permit under O. 80 and reject the goods for

export.

In this fashion, there is no irreconcilable conflict between O. 79 and O. 80 insofar as the reasonable grounds are concerned with the condition of the goods. That, however, is not the present case.

33. Here, the reasonable grounds were concerned with non-compliance with orders which applied to the goods the subject of the Permit. In those circumstances, on the face of the orders, the authorized officer was subjected to concurrent conflicting obligations, to suspend and revoke. It could well be pointless in providing, in such circumstances, for suspension until inspection and analysis, if the authorized officer was obliged forthwith to reject the goods for export and revoke the permit. In dealing with an apparent conundrum such as that presented by paras. (a) in O. 79 and O. 80, the Court should strive to avoid a capricious or irrational result and seek to give each provision a field of operation. In A.M.P. Inc. v Utilux Pty Ltd (1972) RPC 103 at 109, Lord Reid said that, it being improbable that the framers of legislation could have intended to insert a provision which has virtually no practical effect, one should look to see whether any other meaning produces a more reasonable result. See also Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation [1981] HCA 26; (1981) 147 CLR 297 at 321, per Mason and Wilson JJ, and Occidental Life Insurance Company of Australia Limited v Life Style Planners Pty Ltd [1992] FCA 549; (1992) 38 FCR 444 at 449-450, per Lockhart J.

34. In the present case, this is done by treating O. 79 and O. 80, where the reasonable grounds relate to non-compliance with orders that apply to prescribed goods, as operating sequentially in the manner urged by counsel for Dover. It follows that the decision the subject of the second appeal was not, within the meaning of para. 5 (1) (d) of the ADJR Act, authorized by the enactment in pursuance of which it was purported to be made. That conclusion as to the construction of the orders provides added, and more than sufficient, support for the interlocutory order made by the primary Judge on 23 March 1993 to suspend the decisions of Mr Cox to revoke the Permit and reject the abalone for export.

35. It is unnecessary further to consider the discretionary matters to which the primary Judge had regard in making that order. It will be necessary to consider later in these reasons further points as to the construction of O. 79.

36. Dover also submits that O. 79 and O. 80 are beyond the regulation making power conferred by the Act. As I have indicated, the General Orders were made by the Minister pursuant to reg. 3, which in turn was made by the Governor-General under s. 25 of the Act and, in terms, followed para. 25 (2) (g) of the Act. The regulation making power extended to empowering the Minister to make orders not inconsistent with the Regulations "with respect to any matter for or in relation to which provision may be made by regulations". This in turn refers the reader to s. 7 of the Act, which I have described earlier in these reasons.

37. As counsel for the appellants points out, s. 7 speaks of regulations which prohibit the export of prescribed goods absolutely. Provision also is made, in sub-s. 7 (3), for the erection of a licence system with provision for the revocation or suspension of licences.

38. Counsel for Dover submitted that the subordinate legislation under consideration here was such a direct and substantial invasion of "substantive rights" that the Court should hold that it was not "reasonably proportionate" to the enabling purpose. He referred to various decisions including that of the High Court in State of South Australia v Tanner [1989] HCA 3; (1989) 166 CLR 161 at 165, and those of this Court in Minister for Primary Industries and Energy v Austral Fisheries Pty Ltd [1993] FCA 45; (1993) 112 ALR 211 at 214-5, 230, and the Full Court of the Supreme Court of South Australia in Taylor v Guttilla (1992) 168 LSJS 133.

39. The present is not a case where the orders are so capricious and irrational that no reasonable person could have devised them, in the sense discussed in the Austral Fisheries case. Rather, as counsel for the appellants points out, where the Act specifically contemplates an absolute prohibition upon prescribed goods, it is difficult to see how O. 79 and O. 80, which affect the operation of the licence system which qualifies what otherwise might be the total prohibition, are to be characterized as disproportionate to the enabling purpose. The relevant criterion of validity in such a case cannot be the fairness of the delegated legislation: Coulter v The Queen (1988) 164 CLR 350 at 357, per Mason CJ, Wilson, Brennan JJ.

40. The concept of "reasonable proportionality" as a criterion for assessment of validity in constitutional and administrative law appears to have entered the stream of the common law from Europe and, in particular, from the jurisprudence of the Court of Justice of the European Communities and the European Court of Human Rights. If a state is to justify interference by its executive, legislature or courts with the freedom of expression guaranteed by Article 10 of the European Convention For The Protection Of Human Rights And Fundamental Freedoms, the interference must correspond to "pressing social need" and be "proportionate" to the "legitimate aim" pursued by the state: The Sunday Times v United Kingdom [1979] ECHR 1; (1979) 2 EHRR 245 at 277-8, 280. The validity of national legislation restricting trade and working hours on Sundays, in the light of Article 30 of the EEC Treaty (which prohibits between member States "quantitative restrictions on imports and all measures having equivalent effect") is assessed by application of standards of "necessity" and "proportionality": see the litigious saga of the British Sunday trading legislation disclosed in Kirklees Metropolitan Borough Council v Wickes Building Supplies Ltd (1993) AC 227 at 277-8, and Stoke-on-Trent Council v B and Q Plc (1993) 2 All ER 297. Here, "proportionality" has been said to mean that, "in short, a reasonable relationship must exist between aims and means": Koopmans, "European Public Law: Reality and Prospects" (1991) PL 53 at 58.

41. In English administrative law, it seemed that the concept of proportionality might be adopted as a ground of review of alleged abuse of statutory discretion, perhaps as an adjunct to Wednesbury unreasonableness: see the discussion in Beatson and Matthews, "Administrative Law: Cases and Materials", 2nd Ed., 1989; Cane, "An Introduction to Administrative Law", 2nd Ed., 1992, p 211-2. However, in Regina v Secretary of State for the Home Department; Ex parte Brind [1991] UKHL 4; (1991) 1 AC 696 at 762, Lord Ackner said:

"Clearly a decision by a minister which suffers

from a total lack of proportion-ality will

qualify for the Wednesbury unreasonable epithet.

It is, ex hypothesi, a decision which no

reasonable minister could make. This is,

however, a different and severer test.

Mr Lester is asking your Lordships to adopt a

different principle - the principle of

'proportionality' which is recognised in the

administrative law of several members of the

European Economic Community. What is urged is a

further development in English administrative

law, which Lord Diplock viewed as a possibility

in Council of Civil Service Unions v Minister

for the Civil Service (1985) AC 374, 410.

In his written submissions, Mr Lester was at

pains to record . . . that 'There is a clear

distinction between an appeal on the merits and

a review based on whether the principle of

proportionality has been satisfied.' He was

prepared to accept that to stray into the realms

of appellate jurisdiction involves the courts in

a wrongful usurpation of power. Yet in order to

invest the proportionality test with a higher

status than the Wednesbury test, an inquiry into

and a decision upon the merits cannot be

avoided. . . . The European test of 'whether

the "inter-ference" complained of corresponds to

a "pressing social need"' (The Sunday Times v

United Kingdom [1979] ECHR 1; (1979) 2 EHRR 245, 277) must

ultimately result in the question 'Is the

particular decision acceptable?' and this must

involve a review of the merits of the decision.

Unless and until Parliament incorporates the

Convention into domestic law, . . . there

appears to me to be at present no basis upon

which the proportionality doctrine applied by

the European Court can be followed by the courts

of this country."

Lord Lowry (at 766-7) said that to introduce the proportionality doctrine would lead to abuse of the supervisory jurisdiction of the courts. Lord Templeman (at 756) seemed to treat proportionality as an aspect of the Wednesbury doctrine. Lords Bridge (at 749) and Roskill (at 750) were non-committal.

42. However, in Australia the proportionality doctrine has taken root and, indeed, extended its reach into the heartland of federal constitutional law. First, the rather special and "purposive" nature of the legislative power with respect to external affairs in its application to existing and reasonably apprehended international obligations, led to its confinement to what may reasonably be regarded as appropriate means for implementation of the obligation: The Tasmanian Dam Case [1983] HCA 21; (1983) 158 CLR 1 at 172, 232-3, 259-61, Richardson v Forestry Commission [1988] HCA 10; (1988) 164 CLR 261 at 295-6, 303, 311-12, 326, 336. Secondly, the doctrine has been applied to the operation of constitutional prohibitions or restraints upon the scope of legislative power, whether these prohibitions or restraints arise expressly, as with s. 92 of the Constitution, (Castlemaine Tooheys Ltd v South Australia [1990] HCA 1; (1990) 169 CLR 436 at 473-4) or impliedly (Nationwide News Pty Ltd v Wills [1992] HCA 46; (1992) 108 ALR 681 at 706, 726-7, 740-41). Thirdly, the doctrine has been applied generally as a criterion of validity of provisions which fall outside the "core" of the subject matters of certain of those legislative powers in s. 51 which are not "purposive" powers; see, as to the trade marks and corporations powers, Davis v The Commonwealth [1988] HCA 63; (1988) 166 CLR 79 at 99-100, and as to the conciliation and arbitration power, Nationwide News Pty Ltd v Wills supra at 689-91 per Mason CJ, Dawson J contra at 736.

"Davis establishes two propositions. First,

that, even if the purpose of a law is to achieve

an end within power, it will not fall within the

scope of what is incidental to the substantive

power unless it is reasonably and appropriately

adapted to the pursuit of an end within power,

i.e., unless it is capable of being considered

to be reasonably proportionate to the pursuit of

that end. Secondly, in determining whether that

requirement of reasonable proportionality is

satisfied, it is material to ascertain whether,

and to what extent, the law goes beyond what is

reasonably necessary or conceivably desirable

for the achievement of the legitimate object

sought to be attained and, in so doing, causes

adverse consequences unrelated to the

achievement of that object. In particular, it

is material to ascertain whether those adverse

consequences result in any infringement of

fundamental values traditionally protected by

the common law, such as freedom of expression."

44. These propositions are important, but as yet scarcely explored by the Courts when dealing with the immediately significant operation of the concept for these appeals. This is as a test of validity of delegated legislation. In that context, one ordinarily would not characterize the steps taken by the delegate of the Parliament by use of criteria, such as Wednesbury unreasonableness, which are concerned with the exercise of statutory discretion and administrative decision-making. The issue in the present context is whether the law made by the process of delegation is valid, not whether an administrative decision is reviewable for error.

45. In Tanner supra at 165, Wilson, Dawson, Toohey and Gaudron JJ said:

"In the course of argument, the parties accepted

the reasonable proportionality test of validity

(cf. Deane J in The Commonwealth of Australia v

Tasmania (the Tasmanian Dam Case) (1983) 158

CLR 1 at 260), namely, whether the regulation

is capable of being considered to be reasonably

proportionate to the pursuit of the enabling

purpose. However, they differed in the answers

to which their application of the test led. The

same test, in relation to a power limited to

regulation, was expressed by Dixon J in

Williams (v Melbourne Corporation) (1933) 49

CLR 142 at 156, as being, in substance,

whether the regulation goes beyond any restraint

which could be reasonably adapted for the

prescribed purpose."

Earlier, in Coulter v The Queen, supra, Mason CJ, Wilson and Brennan JJ had also treated Williams as authoritative, asking whether the Rules of Court in question were "a reasonable means of attaining the ends of the rule-making power". See also Minister for Foreign Affairs and Trade v Magno [1992] FCA 566; (1992) 37 FCR 298 at 309-311, 327-9.

46. These observations in the High Court indicate that whatever may be the sweep of the proportionality principle in federal constitutional law, when the question of validity is concerned with delegated legislation made pursuant to a law of the Parliament whose validity itself is not impugned, the proportionality principle is differently focussed. The observations by their Honours further suggest that here at least there has been no significant shift in doctrine and, indeed, that the subject still is controlled by what was said by Sir Owen Dixon over 50 years ago; see the discussion by Mr Peter Bayne in his note "Reasonableness, Proportionality and Delegated Legislation", (1993) 67 ALJ 448 esp at 449-450. The fundamental question is whether the delegated legislation is within the scope of what the Parliament intended when enacting the statute which empowers the subordinate authority to make certain laws: see Austral Fisheries, supra at 214, per Lockhart J.

47. The treatment by 4 members the High Court in Tanner of the remarks of Dixon J in Williams as identifying what they understood by the proportionality criterion as applied to the validity of delegated legislation, brought with it, in my view, the subsequent elaboration by Dixon J of his views. In the joint judgment, to which Dixon CJ was a party, in Shanahan v Scott [1957] HCA 4; (1957) 96 CLR 245 at 250, the following was propounded. A power such as that in sub-s. 25 (1) of the Act does not authorize the making of regulations which vary or depart from the positive provisions of the Act, or which go outside the field of operation which the Act marks out; such a power does not support attempts to widen the purposes of the Act, to add new and different means of carrying them into effect, or to depart from or vary the plan which the legislature has adopted to obtain its ends. These are indicia which assist in deciding the general question of whether the regulations in question are a reasonable means of attaining the ends of the legislative delegation of power.

48. Looked at in this way, I conclude that O. 79 and O. 80 do not fall outside power. The licensing system of which they are a part cannot be described as going beyond any restraint which could reasonably be adopted for the prescribed purpose.

49. It is true that sub-para. 7 (3) (b) (iv) of the Act speaks of regulations which make provision for and in relation to the revocation or suspension of a licence or permission that is granted "subject to a condition or restriction to be complied with". Counsel for Dover points out that the export permits in question here were relevantly unconditional. He contends that therefore in its application to the Permit, O. 79 and O. 80 travel beyond this sub-paragraph in sub-s. 7 (3) of the Act. However, sub-s. 7 (3) is introduced by the words "Without limiting the generality of subsection (2)". Sub-section 7 (2) states that the regulations may, inter alia, "prohibit the export or prescribed goods unless specified conditions or restrictions are complied with". The specified conditions in the General Orders include the condition that the exporter shall hold an export permit: O. 11.1 (k).

50. The attack on validity fails. I turn to consider the remaining issues as they affect the first appeal.

51. Mr David Cox is Manager, Processed Food Inspection Operations, of the Australian Quarantine and Inspection Service ("AQIS") of the Department administered by the first appellant. On 10 March 1993, he was notified by a subordinate that Dover had submitted a notice of intention to export the 100 cartons of abalone, the subject of this litigation. Mr Cox was in receipt of information concerning what he believed to be potential breaches of the Act and associated orders by Auslive. He also was then of the view that it appeared that abalone transferred to Dover from Auslive might not be eligible for export because it may not have been processed in accordance with the orders. However, on 10 March, he instructed that the permit should issue. He did this because he was not then fully satisfied that the abalone was ineligible.

52. As I have indicated, the decision to suspend was made by Mr Martin, another officer of AQIS, on 14 March 1993. The decision was communicated to Dover by letter, the concluding paragraph of which read:

"In accordance with Order 79 (1) and (d) of the

Prescribed Goods (General) Orders, Export permit

No. 2290902 is suspended until you can identify

and segregate abalone received from EST 9242,

since 18 January 1993. Following segregation to

AQIS satisfaction, the remaining abalone which

does comply with orders under the Export Control

Act will be permitted to be exported."

In the interval between 10 and 14 March, Mr Cox had told Mr Martin that export should not be permitted.

53. In his oral reasons for judgment, delivered ex tempore on 17 March 1993, the primary Judge referred in particular to two matters. The first concerned a matter of fact and the second points of construction of Order 79. It is necessary to deal with these two points in turn.

"My first observation is that Mr Cox saw fit to

acknowledge that on 10 March, he was of opinion

that the relevant export permit should issue

because, as he said, he was not then fully

satisfied that the abalone was ineligible.

I found it difficult, in the short time that has

been available to me, to comprehend from the

quick reading of his affidavit that he

thereafter gained additional and sufficient

information to justify the drastic change in

attitude that was manifested by his later

decision on 12 March to direct that the permit

be suspended.

I want it clearly understood, in fairness to Mr

Cox, that it may well be that he did have those

reasonable grounds and it may well be that in

the urgency of this matter and in the limited

time available, he did not have the opportunity

to spell it out in sufficient detail for me to

comprehend their existence.

At this stage, therefore, on the limited

information that is before me, I am not

satisfied of the existence of those reasonable

grounds."

55. Counsel for the appellants pointed to paras. 27 and 28 of Mr Cox's affidavit, sworn and read in the first proceeding, and submitted that they showed the receipt by Mr Cox in the interval in question of important information which more than adequately explained his shift in position. It followed, counsel submitted, that, his Honour having mistaken in an important respect the uncontested facts, there had been a miscarriage in the exercise of his Honour's discretion in granting interlocutory relief: House v The King [1936] HCA 40; (1936) 55 CLR 499 at 505. On the afternoon of 11 March 1993, Mr Cox received a written report by Mr G.R. Jackson, a Senior Compliance Officer with AQIS. This related some background history, including the detection of Mr S.P. Llewellyn, a son of a director of Auslive, some 5 weeks earlier in the company of a convicted abalone poacher, one Cam Straun. They were in a motor vehicle with a load of abalone apparently without appropriate documentation as required under Victorian legislation. The report went on to deal with the raid on 5 March 1993 of an unlicensed abalone establishment at Springvale in Victoria where, amongst others, Mr S.P. Llewellyn was present. His father, Mr M. Llewellyn, had been interviewed on 9 and 10 March 1993 and asked to produce certain records dealing with abalone purchases, sales, opening and closing invoices and the like. At the second interview, on 10 March 1993, Mr Llewellyn had stated that he had been advised by his solicitor not to make any comments.

56. One of the recommendations made in the report by Mr Jackson was that consideration be given to the export eligibility of Auslive abalone delivered to Dover since 18 January 1993, in the light of the circumstance that Auslive did not hold the appropriate Victorian endorsed abalone licence as required by O. 7.2 of the Processed Food Orders. The lack of the Victorian licence was confirmed by the receipt on 11 March 1993 by Mr Cox of a report by the Victorian Department of Conservation and Natural Resources. This confirmed that neither Auslive nor either of the Messrs Llewellyn held a Victorian commercial processors licence as required by the Victorian Fisheries Act.

57. Counsel for the appellants also point out that there is no requirement of law that the authorized officer act only on material which would be admissible in evidence before a court: Mahon v Air New Zealand Ltd [1983] UKPC 29; (1984) AC 808 at 821. Further, Mr Cox had sworn as to the grounds known to him at the time of the decision in question, and in those circumstances, as counsel for the appellant submit, it was for Dover to put a case at the interlocutory level that such grounds did not exist or that they were not reasonable: W.A. Pines Pty Ltd v Bannerman [1980] FCA 79; (1980) 41 FLR 175 at 181.

58. In my view, those submissions should be accepted. But that does not mean that the first appeal should succeed.

59. The second matter stressed by the primary Judge as a ground which led to him making the orders on 17 March which are now under appeal concerned what he described as "more of a technicality". To an extent, the point turned upon the concluding paragraph of the letter of 14 March. I have set this out earlier in these reasons.

"Let us assume that there were reasonable

grounds that an order which applies to the

abalone had not been complied with. In those

circumstances, the relevant authorized officer

was entitled to:

suspend the export permit until such time

as the inspection and any analysis of the

goods is completed.

I take the words that I have just quoted (from

O. 79) as meaning activities on the part of the

authorities whereby they inspect and analyse the

goods in respect of which the reasonable grounds

for relief exist.

It seems to me that the letter of 14 March has

misconceived the responsibilities of the

authorities. They have just given a blanket

suspension with the invitation to the intending

exporter to proceed to identify and segregate

abalone on the premise, so it would seem, that

the actions of the exporter will determine when,

if any, can consequently be exported.

That's not the perception of order 79 as I see

it . . . Insofar as (counsel for the Minister)

says that Mr Cox's affidavit does throw up the

true purpose in terms of order 79, that may be

the case. The point is that it should be

contained in the letter of 14 March."

61. Counsel for Dover developed this point by submitting to us that the statement in the letter of 14 March that the Permit was suspended until Dover could identify and segregate abalone received from Auslive since 18 January 1993 reflected a fatal misconstruction by Mr Martin of O. 79. It was submitted that O. 79 only contemplates a suspension, pending inspection and analysis of "the goods", that the steps under O. 79 are inappropriate and inapplicable to a case where "the state of the goods is not challenged", and that O. 79 does not permit a suspension "based on failure to keep appropriate paperwork".

62. To evaluate these submissions, which depend essentially upon the construction of O. 79, it is necessary to refer further to the nature of the regulatory scheme and, in particular, to refer further to the Processed Food Orders.

63. These require the maintenance of accurate records concerning the receipt, processing and dispatch of all raw materials and foodstuffs, including abalone, at registered establishments, and regarding the processing and production of all processed food, including abalone, at registered establishments. Order 7 of the Processed Food Orders is as follows:

"7.1 These Orders do not exclude the operation of a

provision of a law of a State or Territory with

respect to fisheries that relates to the enforcement

of a provision of that law concerning the taking of

fish.

7.2 Processed food must not be prepared from materials

which have been received, taken or processed, in

contravention of any law of the Commonwealth, a State

or Territory."

Schedule 12 sets up a complex system dealing with the transport of processed food within Australia, and the use of what are called transfer certificates.

64. It is submitted for the appellants that when O. 79 is read in this context and with respect to goods consisting of sealed containers of food, the notion of "inspection" in O. 79 must embrace checking the documentation which would throw light on the condition and other relevant characteristics of the goods. There is, in my view, a real difficulty with that submission as to the construction of O. 79. Where the authorized officer has the reasonable grounds spoken of in this order, the officer is obliged to inspect the goods and suspend any export permit, the suspension to operate "until such time as the inspection and any analysis of the goods is completed". The notion of "inspection" is thus closely linked to that of "analysis of the goods".

65. A similar point may be made concerning O. 82. This speaks of retaining the goods for the purpose of inspecting them, there being reasonable grounds to believe that they are not fit for export. Likewise, O. 83 speaks of the inspection of prescribed goods, clearly in a context where the issue is whether the goods, whilst not fit for export, are fit for human consumption. All of these provisions may be compared with O. 80. If, under O. 80, there are reasonable grounds to believe that an order that applies to the documentation for the goods has not been complied with, the authorized officer shall reject the goods for export and revoke any export permit. In aid of the formation of that reasonable belief, the Act provides for the making of searches, as discussed above when dealing with s. 10.

66. I would reject the particular construction sought to be put by the appellants upon O. 79.

67. However, as I read what was said by the primary Judge, the second point to which he referred was not concerned with this question of construction. Rather, his Honour was concerned that the terms of the letter of 14 March identified the nature and period of the suspension in a manner contrary to O. 79. The suspension was described as having effect not until such time as inspection of the goods had been completed by AQIS and any analysis of the goods had been completed. Rather, the suspension was to cease with the identification and segregation by Dover of the abalone received from Auslive since 18 January 1993. The point was made clearer by the concluding sentence in the letter of 14 March:

"Following segregation to AQIS satisfaction the

remaining abalone which does comply with orders

under the Export Control Act will be permitted

to be exported."

68. Counsel for the appellants submitted that the decision was one to suspend the Permit until Dover "rendered the goods into a condition in which they could be inspected and/or analysed for compliance with the orders". As to that, two things may be said. The first is that there must be a real doubt as to whether a suspension, even in those terms, is one which complies with O. 79. And the second is that it is by no means clear that this was the meaning of the letter of 14 March. The essential point is that O. 79, where the relevant reasonable grounds of belief exist, obliges the authorized officer to take 2 steps. One is the inspection of the goods. The second is the suspension of any export permit for a time which is defined in O. 79 as "such time as the inspection and any analysis of the goods is completed".

69. Had it been necessary for the primary Judge to decide the point on a final basis, then in my view it would have been properly decided adversely to the appellants. As it is, there undoubtedly was a serious question to be tried as to the validity of the decision taken under O. 79.

70. It then became a question for the primary Judge to consider the balance of convenience.

71. We were taken carefully through the evidence which bore upon both sides of this question. In the end, even if the matter were now thrown open for a fresh assessment, I would be persuaded that the balance of convenience favoured Dover. The decision the subject of the first appeal should not be upset.

72. The result is that each of these appeals should be dismissed with costs.

HILL J I have read the judgment of Gummow J in this matter and agree with his Honour's reasons and the conclusions which he has reached.

2. In the course of that judgment his Honour discusses the application of the "reasonably proportionate" test in administrative law, a matter which must be regarded at the moment as still fluid in Australian jurisprudence.

3. The adoption of what Dixon J had said in Williams v Melbourne Corporation [1933] HCA 56; (1933) 49 CLR 142 at 156 by Wilson, Dawson, Toohey and Gaudron JJ in State of South Australia v Tanner [1989] HCA 3; (1989) 166 CLR 161 at 165, appears to require a Court in considering delegated legislation to determine whether the operation of that delegated legislation was reasonably adopted as a means of attaining the ends of the rule-making power. No doubt the matters referred to by the High Court in Shanahan v Scott [1957] HCA 4; (1957) 96 CLR 245 at 250 will be relevant in this inquiry, albeit they may not necessarily be the sole matters for consideration.

4. In the present case it is unnecessary to decide the precise scope and operation of the reasonably proportionate test. For however broad an application that test may be given, O.79 and O.80 do not go beyond any restraint which could be reasonably adopted for the prescribed purpose nor are they so lacking in reasonable proportionality as not to be a real exercise of power.

5. I agree that each of the appeals should be dismissed with costs.

COOPER J I have read the reasons for judgment of Gummow J. I agree with the orders he proposes for the reasons he has given. I wish only to add my own observations as to the operation of the test of proportionality when the question of the validity of delegated legislation arises.

2. The issue of the validity of delegated legislation poses the ultimate question whether the delegated legislation is within the regulation or rule making power conferred by the enabling statute. This question is answered by determining :-

(a) as a matter of statutory construction the ambit and

statutory object of the regulation or rule making power;

(b) whether the delegated legislation as an exercise in

characterisation by reference to its substantive operation

falls within the power.

3. The first of these matters requires a consideration of section 25 of the Export Control Act 1982 which contains the regulation making power. The statutory scheme is set out in the reasons of Gummow J and I will not repeat it. Sufficient for present purposes is to restate so much of section 25 as is presently relevant. The section states:-

"(1) The Governor-General may make

regulations, not inconsistent with this Act,

prescribing matters:

(a) required or permitted by this Act to

be prescribed; or

(b) necessary or convenient to be

prescribed for carrying out or

giving effect to this Act.

(2) In particular, but without limiting

the generality of subsection (1), the

regulations may make provision for or in

relation to:

....

(g) subject to subsection (3),

empowering the Minister to make

orders, not inconsistent with the

regulations, with respect to any

matter for or in relation to which

provision may be made by the

regulations".

Regulation 3 of the Export Control (Orders) Regulations (SR 355 of 1982) provides:-

"3. The Minister may, by instrument in

writing, make orders, not inconsistent with the

Regulations made under the Act, with respect to

any matter for or in relation to which provision

may be made by Regulations under the Act".

4. The orders in issue in these proceedings were made by the Minister in exercise of the power contained in Regulation 3 which regulation was enacted under the power contained in section 25, and in particular section 25(2)(g), of the Export Control Act 1982.

5. A general regulation making power substantially in terms, and to the effect, of section 25(1) was considered in Shanahan v. Scott [1957] HCA 4; (1957) 96 CLR 245 where the majority (Dixon CJ , Williams, Webb and Fullagar JJ) said at 250 :-

"Powers of this kind have been discussed in more

than one case in this Court: see Carbines v.

Powell [1925] HCA 16; (1925) 36 CLR 88; Gibson v. Mitchell

[1928] HCA 37; (1928) 41 CLR 275; Broadcasting Co. of

Australia Pty. Ltd. v. The Commonwealth (1935)

[1935] HCA 3; 52 CLR 52; Grech v. Bird (1936) 56 CLR

228; Morton v. Union Steamship Co. of New

Zealand Ltd. (1951) 83 CLR 502, at p 409,

The result is to show that such a power does not

enable the authority by regulations to extend

the scope or general operation of the enactment

but is strictly ancillary. It will authorise

the provision of subsidiary means of carrying

into effect what is enacted in the statute

itself and will cover what is incidental to the

execution of its specific provisions. But such

a power will not support attempts to widen the

purposes of the Act, to add new and different

means of carrying them out or to depart from or

vary the plan which the legislature has adopted

to attain its ends".

6. Accordingly the statutory scope, operation and purpose of the Export Control Act 1982 must be ascertained to set the proper limits of the powers granted by section 25 and what is properly incidental in carrying the statutory purpose or scheme into effect.

7. The second matter for determination is the characterisation of the delegated legislation by reference to its substantive operation. As Deane J observed in Richardson v. Forestry Commission [1988] HCA 10; (1988) 164 CLR 261 at 308 :-

"Ordinarily, that process of characterization

will involve no more than consideration of the

law's objective legal operation without regard

to any ulterior legislative purpose or object.

There are, however, circumstances in which

characterization of a law requires that regard

be paid to any such purpose or object. The

obvious example of such circumstances is the

case where the direct legal operation of a law

does not of itself suffice to characterize it as

a law with respect to a subject-matter of

Commonwealth legislative power but some ulterior

purpose or object which the law was enacted to

serve may suffice to warrant characterization of

it as a law with respect to such a subject-matter".

8. Characterisation may be approached in a number of ways, the choice of which will be determined by the nature of the statute in which the regulation or rule making power is sourced and the terms in which that power is expressed itself. For example, where the regulation or rule making power is expressed in general terms as in the present case, the court will be concerned to see that the delegated legislation objectively does not have, or attempt to effect, any of the prescribed results identified in the passage from Shanahan v. Scott cited above.

9. If the regulation or rule making power is purposive then one approach is to ask whether the delegated legislation is a reasonable means of attaining the ends of the regulation or rule making power (Coulter v. The Queen (1988) 164 CLR 350 at 357) or, to put it in another way, whether the regulation goes beyond any restraint which could be reasonably adopted for the prescribed purpose (Williams v. Melbourne Corporation [1933] HCA 56; (1933) 49 CLR 142 at 155; South Australia v. Tanner [1989] HCA 3; (1989) 166 CLR 161 at 165, 175 - 179; Castlemaine Tooheys Ltd. v. South Australia [1990] HCA 1; (1990) 169 CLR 436 at 473).

10. The test of proportionality operates in this area as a measure of the limit beyond which the means adopted to achieve the prescribed purpose cannot go without rendering the delegated legislation, at least to that extent, invalid. The substantive operation of delegated legislation must be capable of being reasonably considered to be appropriate and adapted to achieve the prescribed purpose. This requires that there is reasonable proportionality between the object or purpose and the means adopted to achieve or procure it. (The Commonwealth v. Tasmania [1983] HCA 21; (1983) 158 CLR 1 at 260; Richardson v. Forestry Commission at 311- 312, 346; Nationwide News Pty. Ltd. v. Wills (1992) 66 ALJR 658 at 661, 689, 692.

11. If the regulation or rule making power is found in a statute the subject matter of which cannot be described as purposive then the question is whether there is a real and substantial connection between the delegated legislation and the subject matter of the grant of power (Burton v. Honan [1952] HCA 30; (1952) 86 CLR 169 at 179; Murphyores Inc. Pty. Ltd. v. The Commonwealth [1976] HCA 20; (1976) 136 CLR 1 at 11 - 12); Nationwide News Pty. Ltd. v Wills at 661). It is not sufficient that there be merely some connection between the delegated legislation and the subject matter of the regulation or rule making power. The connection must be "so direct and substantive that the regulation is seen really to satisfy one of the descriptions by reference to which the regulation-making power is conferred" (per Williams ACJ and Kitto J in Clements v. Bull [1953] HCA 61; (1953) 88 CLR 572 at 577). Where no reasonable mind could justify the delegated legislation by reference to the purposes of the power, or the subject matter of the power, the conclusion is that there is no real connection between delegated legislation and the power (Clements v. Bull at 577, 581). To formulate the test in the terms used in Clements v. Bull, is no different to the test:

"...the Court will not hold the regulation

invalid unless, having regard to its operation

in the circumstances to which it applies and to

the statutory object to which it is directed,

the regulation could not reasonably have been

adopted to achieve the object".

(Per Brennan J in South Australia v. Tanner at 176; see also per Gaudron J in Nationwide News Pty. Ltd. v. Mills at 689 and the cases cited there). In the context of the validity of delegated legislation "reasonableness" does not connote "fairness". It is a question whether as a matter of objective reason and logic the regulation could have been adopted to achieve the object.

12. Where the likely substantive operation of the delegated legislation in its impact upon matters beyond the subject matter of the power or matters incidental thereto is grossly disproportionate to its operation on matters properly the subject matter of the power, there will be no real or sufficient connection to sustain the validity of the delegated legislation. That is, no reasonable mind could justify the delegated legislation by reference to the object of the power. It is the disproportionate operation of the delegation which denies to it a place in the range of alternative modes of implementation available to an objective reasonable mind.

13. The test of proportionality reflects an underlying assumption that the legislature did not intend that the power to enact delegated legislation would be exercised beyond what was reasonably proportionate to achieve the relevant statutory object or purpose; the test of reasonableness assumes that the legislature did not intend to confer a power to enact delegated legislation which enactment no reasonable mind could justify as appropriate and adapted to the purpose in issue and the subject matter of the grant. Whether one describes the test as one of "reasonable proportionality" or "unreasonableness", the object is to find the limit set by the legislature for the proper exercise of the regulation or rule making power and then to measure the substantive operation of the delegated legislation by reference to that limit. In my view there is no substantive difference between the tests as stated. Support for such a conclusion comes from the majority joint judgment (Wilson, Dawson, Toohey and Gaudron JJ) in South Australia v. Tanner [1989] HCA 3; (1989) 166 CLR 161 at 165:-

"In the course of argument, the parties accepted

the reasonable proportionality test of validity

(cf. Deane J in The Commonwealth v. Tasmania

(the Tasmanian Dam Case) [1983] HCA 21; (1983) 158 CLR 1, at

p 260), namely, whether the regulation is

capable of being considered to be reasonably

proportionate to the pursuit of the enabling

purpose. However, they differed in the answers

to which their application of the test led. The

same test, in relation to a power limited to

regulation, was expressed by Dixon J in

Williams (1933) 49 CLR, at p 156, as being,

in substance, whether the regulation goes beyond

any restraint which could be reasonably adopted

for the prescribed purpose".

14. Once it is determined that the means adopted by the delegated legislation is within the ascertained limits of the power of delegation, the choice adopted to achieve the statutory ends, is a matter entirely for the person exercising the power and the Court will not intervene by declaring the chosen method invalid simply because other minds might reasonably have adopted a different means.

15. Whether one applies a test of reasonable proportionality, or unreasonableness, the result is the same in the present case. I agree with Gummow J that the Orders in issue were within a proper exercise of the rule making power conferred by section 25 of the Export Control Act 1982.