New South Wales v Commonwealth [1915] HCA 17

High Court of Australia|1915-07-01|Before: Rioh JJ, Rich JJ, Duffy JJ, Gavan Dufy JJ, Another J

17 " 4 THE STATE OF NEW SOUTH WALES} yopccavns: AND ANOTHER J

H, ©. or A, Constitutional Law - Powers of Parliament of Commonwealth - Inter-State Commis- 1915. sion - Power to create Commission a Court - Powers of "adjudication" - ae Injunction - Validity of Commonwealth legisiation - The Constitution (63 & 64

MELBOURNE, Vict. c. 12), secs. 72, 101, 103 - Inter-State Commission Act 1912 (No. 33 of

Barton, Isaacs, ment of contracts as to such goods - Hminent domain - Validity of State legisla- paren Duly, tion - The Constitution (63 & 64 Vict. c. 12), secs. 92, 106, 107 - Wheat Rioh JJ. Acquisition Act 1914 (N.S. W.) (No. 27 of 1914), secs. 3, 8, 9.

Sec. 101 of the Constitution does not authorize the Parliament of the Com- monwealth to constitute the Inter-State Commission a Court, and therefore the provisions of Part V. of the Inter-State Commission Act 1912 are ultra vires the Parliament of the Commonwealth.

So held by Griffith C.J. and Isaacs, Powers and Rich JJ. (Barton and Gavan Duffy JJ. dissenting).

Held, therefore, by Griffith C.J. and Isaacs, Powers and Rich JJ. (Barton

and Gavan Dufy JJ. dissenting), that the Inter-State Commission has no power to issue an injunction.

The Wheat Acquisition Act 1914 (N.S.W.) provides by sec, 3 that the Governor may by notification in the Gazette declare that any wheat therein described or referred to is acquired by His Majesty, and that upon such pub- ication the wheat shall become the absolute property of His Majesty, and the rights and interests of every person in the wheat at the date of such pub- lication shall be taken to be converted into a claim for compensation, Sec. 8 (1) provides that 'Every contract made in the State of New South Wales prior to the passing of this Act, so far as it relates to the sale of New South Wales 1914-15 wheat to be delivered in the said State, is hereby declared to be and to have been void and of no effect so far as such contract has not been completed by delivery." Sec. 9 provides that "« Every contract for the sale of flour made in New South Wales prior to the passing of this Act, so far as it relates to the sale of flour to be delivered after Ist January 1915, is hereby declared to be and to have been void and of no effect."

Held, by the whole Court, that none of those provisions violated the pro- vision in sec. 92 of the Constitution that trade, commerce and intercourse among the States should be absolutely free, and therefore that the Wheat Acquisition Act 1914 was intra vires the Parliament of New South Wales.

Appeat from the Inter-State Commission, and Motion.

A complaint before the Inter-State Commission was, pursuant to the Inter-State Commission Act 1912, instituted by petition by the Commonwealth against the State of New South Wales and the Inspector-General of Police for that State alleging a contravention of the provisions of the Constitution in respect of three parcels of wheat.

The acts alleged, and which were substantially proved, were as follows : -

(1) On 5th December 1914 T. J. Gorman, a resident of New South Wales, sold wheat then in New South Wales to Arnott & Doyle of Yarrawonga in Victoria, to be delivered at Yarrawonga. Some of the wheat had been delivered on 18th December 1914, and, while a further portion of the wheat was being carried from New South Wales to Victoria in pursuance of the contract, the defendants seized it and prevented it from being delivered at Yarrawonga.

(2) On 5th December 1914 E. J. Gorman, a resident of New South Wales, sold wheat then in New South Wales to J. F. Goulding of Melbourne, to be delivered on railway trucks at Yarrawonga or Cobram, both in Victoria. Part of this wheat had been delivered on 18th December 1914, and the defendants prevented EB. J. Gorman

'THe Com- MONWEALTH v 'Tue State or New Sourn Wates.

from carrying the balance of the said wheat to, and delivering it in, Victoria.

(3) Before 18th December 1914, on various dates, Sheppard, Harvey & Co. sold wheat then in New South Wales on account of a number of farmers in New South Wales to W. 8. Kimpton & Son of Melbourne. On 19th December 1914 part of the said wheat was

"lying in trucks at railway stations in New South Wales and another

part of it was lying at such railway stations waiting to be loaded on trucks. Such wheat was in course of transit from New South Wales to Melbourne in pursuance of the sale, and the defendants permitted the wheat which was in trucks to be carried to and delivered in Mel- bourne, but seized the wheat which was lying at the railway stations and prevented it from being carried to and delivered at Melbourne.

The Commonwealth asked for an order commanding the defend- ants to cease and desist from the contravention of the Constitution complained of.

The defendants by their answer alleged that when the wheat was taken possession of by them it was the property of His Majesty the King by virtue of the Wheat Acquisition Act 1914 (N.S.W.) and notifications thereunder by the Governor of New South Wales. Each notification was that the wheat therein described was acquired by His Majesty ' provided that this declaration shall not extend to wheat now actually in transit to the States of the Commonwealth of Australia other than New South Wales."

On the opening of the case before the Inter-State Commission the preliminary objection was taken that the Commission had no jurisdiction to entertain the petition or to grant the relief asked for, but the Commission overruled it. After the hearing of evi- dence and arguments the Commission, by a majority (the Chief Commissioner, A. B. Piddington, Esq., K.C., dissenting), found that the Wheat Acquisition Act was invalid as being an infringement of sec. 92 of the Constitution, and that the acts complained of were also an infringement of that section; and they therefore granted an injunction in the terms asked, and ordered the defendants to pay the plaintiffs' costs.

From that decision the defendants now appealed to the High Court by way of case stated by the Commission.

The case stated set out the following questions of law for the H.C. or Ay

Had the Commission jurisdiction to hear and determine the Tur Srare

petition, to grant the injunction or to make the order for costs " eee : a . 2. If question 1 be answered in the affirmative, was the wheat Was

the subject of the petition or any and what portion thereof the sub- Tum Com- MONWEALTH.

ject of inter-State commerce at the time when the Government of - - - 'Tue Com- MONWEALTL

. " , : _ Tun Srate 3. Did the action of the defendants or either of them in connection or New

with the wheat or any portion thereof constitute a breach of the Sous

New South Wales acquired or purported to acquire it under the

provisions of the Constitution relating to trade and commerce amongst the States ?

On the facts stated are the injunction and order of the Com- mission right in law?

Is the Wheat Acquisition Act 1914 a valid exercise of power by the Legislature of New South Wales ?

During the hearing of the appeal a suit was instituted by the Commonwealth against the State of New South Wales and the Inspector-General of Police for New South Wales by a writ claiming (1) a declaration that the Wheat Acquisition Act 1914 was beyond the powers of the Legislature of New South Wales, and (2) an order restraining the defendants and each of them from infringing the provisions of sec. 92 of the Constitution or from taking steps to enforce the provisions of the Wheat Acquisition Act 1914. It was agreed by all the parties that in the event of the Court holding that the Inter-State Commission had no jurisdiction in the matter the argument should proceed as on a motion by the Commonwealth for an injunction in the suit treated as the hearing of the cause on the facts stated in the case.

The nature of the arguments, fully appears in the judgments hereunder.

Blacket K.C. (with him J. A. Browne), for the appellants. Starke (with him Jan Macfarlan), for the respondents.

Knox K.C. (with him Mackay), for the Farmers and Settlers

'THe Com- MONWEALTH v Tue State or New Sourn WALEs.

Association of New South Wales (who had obtained leave to inter- vene from the Inter-State Commission).

Mitchell K.C. (with him Mann), for the State of New South Wales, intervening.

During argument reference was made to The Tramways Case [No. 1] (1); Moses v. Parker (2); Quick and Garran's Constitution of the Commonwealth, pp. 740, 897, 899 ; Inter-State Commerce Com- mission v. Northern Pacific Railway Co. (3); Allbutt v, General Council of Medical Education and Registration (4); Canadian Pacific Railway Co. v. Toronto Corporation (5); Southern Pacific Terminal Co. v. Inter-State Commission (6) ; Gloucester Ferry Co. v. Pennsylvania (7) ; Savage v. Jones (8); Fox y. Robbins (9); McLean v. Denver and Rio Grande Railroad Co. (10) ; International Textbook Co. v. Pigg (11); Texas and New Orleans Railroad Co. v. Sabine Tram Co. (12); Gulf, Colorado, and Santa Fé Railway Co. v. Texas ; Loewe v. Lawlor (13); Railroad Commission of Louisiana v. Texas and Pacific Railway Co. (14) ; Rearick v. Pennsylvania (15) ; Ameri- can Express Co. v. Iowa (16); Robbins v. Shelby County Taxing District (17); Minnesota Rate Cases (18); Mobile County v. Kim- ball (19) ; Chicago, Milwaukee &c. Railway Co. v. Solan (20) ; Lake Shore and Michigan Southern Railway Co. v. Ohio (21); R. v. Smithers (22); R. v. Commonwealth Court of Conciliation and

Arbitration; Ex parte Whybrow & Co. (23); Osborne v. The Com-

monwealth (24); Owners of s.s. Kalibia v. Wilson (25); Minnesota v. Barber (26); Baer Brothers Mercantile Co. v. Denver and Rio Grande Railroad Co. (27); Geer v. Connecticut (28) ; Oklahoma v. Kansas Natural Gas Co. (29); Schollenberger v. Pennsylvania (30) ;

(1) 18 C.L.R., 54, at p. 71. (17) 120 U.S., 489. (2) (1896) A.C., 245, (18) 230 U.S., 352, at p. 399. (3) 216 U.S., 538, at p. 544, (19) 102 U.S., 169, at fee 697, 702. (4) 23 Q.B D., 400, at p. 412. (20) 169 U.S., 133. (5) (1911) A.C., 461. (21) 173 U.S., 285, at p. 296. (6) 219 U.LS., 498. (22) 16 C.L.R., 99. (7) 114 U.S., 196, at p. 204. (23) 11C.L.R., 1, at pp. 27, 55. (8) 225 U.S., 501, at p. 519. (24) 12 G.L-RY, Sal, at pp. 342, 346, (9) 8 C.L.R., 115, 367. 38, at p. 50. (25) 11 C.L.R., 689, at pp. 698, 702, 713. (12) 297 U.8., wn, at pp. 120, 122. (26) 136 U.S., 313, at p. 318, (13) 208 U.S., 274. (27) 233 US, 470 (14) 229 U.S., 336. (28) 161 ULS., 519. (15) 203 U-S., 507. (29) 221 U.S.; 229, at p. 249, (16) 196 U.S., 133, at p. 143, (30) 171 U.S., 1, at p. 49.

First Employers' Liability Cases (1); Attorney-General for New South Wales v. Brewery Employees' Union of New South Wales (2) ; Newington Local Board v. Cottingham Local Board (3); Judson on Inter-State Commerce, 2nd ed., pp. 88, 473; Cooley's Constitutional Limitations, 7th ed., p. 753; Leake on Contracts, 6th ed., p. 508.

Grirritx C.J. The first of these cases is in form an appeal from an order of the Inter-State Commission purporting to enjoin the State of New South Wales from taking certain action under the provisions of the Wheat Acquisition Act 1914 (No. 27 of 1914) on the ground that the Act itself is invalid and the action taken under it is unlawful as being in contravention of the provision of sec. 92 of the Constitution. The first question raised in the case is whether the Commission had jurisdiction to make such an order.

Sec. 101 of the Constitution provides that '"' There shall be an Inter-State Commission, with such powers of adjudication and administration as the Parliament deems necessary for the execution and maintenance, within the Commonwealth, of the provisions of this Constitution relating to trade and commerce, and of all laws made thereunder."

Sec. 102 empowers the Parliament by a law with respect to trade and commerce to forbid as to railways any preference or discrimination by any State or State authority if such preference or discrimination is undue and unreasonable or unjust to any State, and proceeds to declare that no preference or discrimination shall be taken to be undue and unreasonable or unjust to any State unless so adjudged by the Inter-State Commission. Sec. 103 provides that the members of the Inter-State Commission shall be appointed by the Governor-General in Council, and shall hold office for seven years subject to removal by the Governor-General in Council on an address from both Houses of Parliament praying for such removal on the ground of proved misbehaviour or incapacity, and that the Commissioners shall receive a remuneration to be fixed by the

(1) 207 U.S., 463, at p. 496. (2) 6 C.L.R., 469, at pp. 518, 545. (3) 12 Ch. D., 725, at p. 731.

Tue Com- MONWEALTH v Tue State or New Sourn WateEs.

Parliament and not liable to be diminished during their continuance in office.

By the Inter-State Commission Act 1912 Parliament established an Inter-State Commission, to consist of three members, and con- stituted it a corporation (sec. 4). The term of office was to be seven years, subject to a power of suspension by the Governor-General for misbehaviour or incapacity and of removal by the Governor- General on an address from each House of Parliament for proved misbehaviour or incapacity (sec. 5). This power of suspension is not explicitly authorized by sec. 103 of the Constitution. Part II. of the Act confers on the Commission certain powers of investigation. Part IV. prescribes certain rules to be observed by the public with respect to inter-State traffic. Part V. of the Act, which is headed " Judicial Powers of the Commission," enacts (sec. 23) that the Commission in the exercise of its powers for the hearing or deter- mination of any complaint, dispute or question, or for the adjudica- tion of any matter, shall be a Court of record. Sec. 24 purports to confer upon the Commission jurisdiction to hear and determine any complaint, dispute or question, and to adjudicate upon any matter arising as to -

"(a) any preference, advantage, prejudice, disadvantage, or discrimination given or made by any State or by any State authority or by any common carrier in contravention of this Act, or of the provisions of the Constitution relating to trade and commerce or any law made thereunder ;

"(b) the justice or reasonableness of any rate in respect of

"'(c) anything done or omitted to be done by any State or by any State Authority or by any common carrier or by any person in contravention of this Act or of the provisions of the Constitution relating to trade or commerce or any law made thereunder."

Then follow various provisions as to the exercise of this juris- diction. Sec. 29 purports to confer power to grant any relief to which any of the parties are entitled in respect of any claim properly brought forward by them in the matter. Sec. 30 purports to authorize the Commission to award damages, and either to assess

them itself or by inquiry before one or more of its members or some officer of the Commission. Sec. 31 purports to empower the Com- mission to grant injunctions against future contraventions of the law. Secs. 32 and 33 purport to authorize it to declare that any regulation made by a State or State Authority in contravention of the Act or of the Constitution is void, and to prescribe what shall be done in future with respect to the subject matter. Sec. 34 pur- ports to empower the Commission to fix penalties for disobedience of its orders, which may be enforced by summary conviction. By sec. 35 any order of the Commission may be made a rule or order of the High Court and enforced as such. Sec. 36 provides that for all matters whatsoever necessary or proper fer the due exercise of its jurisdiction under this Part of the Act the Commission shall have all such powers, rights and privileges as are vested in the High Court.

The State of New South Wales contends that the effect of these provisions, if valid, is to confer these powers upon the Commission. as a Court, and not as a corporation or as individuals, that the Con- stitution does not authorize the creation of such a Court, and that this invalid attempt to create a Court is so far bound up with, and so far governs, the subsequent provisions of Part V. as to be inseparable from it, with the result that if the provisions which are only applicable to the Commission regarded as a Court are treated as omitted the remaining provisions would be a different law from that which the Parliament intended to enact, and that they are consequently altogether invalid.

The Commonwealth contend that sec. 102 of the Constitution authorizes the Parliament to make the Commission a Court if it thinks fit to do so. They base their contention mainly upon the words " powers of adjudication " in sec. 101, and upon the provision of sec. 73 by which an appeal lies to the High Court from decisions of the Commission upon matters of law.

Sec. 71 of the Constitution provides that the judicial power of the Commonwealth shall be vested in the High Court and in such other federal Courts as the Parliament creates and in such other Courts as it invests with federal jurisdiction. Sec. 72 provides that the Justices of the High Court and of the other Courts created by

ee, Tue Stare. or New Soutn WaALrEs v Tue Com- MONWEALTH.

Parliament (i.e., federal Courts) shall hold office during good behaviour. It is plain from the provisions of sec. 103 as to the term of office of the Inter-State Commissioners that they were not to be a federal Court within the meaning of sec. 72. But it is contended that sec. 102 should be read as an exception from, or as a supplement to, the provisions of sec. 72. I am unable to accept this argument. In my judgment the provisions of sec. 71 are complete and exclusive, and there cannot be a third class of Courts which are neither federal Courts nor State Courts invested with federal jurisdiction. It was also contended in the alternative that the provision of sec. 73 that appeals shall lie to the High Court from decisions of the Commission, although on questions of law only, puts the Commission on the same footing as a Court. I do not think so. It is manifest that the Commission, for the purpose of adjudging whether an alleged preference or discrimination is undue and unreasonable or unjust to a State, as well as for the purpose of adjudication upon other matters, may have to deal with mixed questions of law and fact, and that very important questions of law may be involved. It was, therefore, very important that its determinations so far as they depended on questions of law should be subject to appeal. The circumstance that this right of appeal is given in the same section which gives an appeal from Courts, properly so called, seems to me rather to suggest that the Commis- sioners were not a Court (for, if they were, they would already be included in the term " federal Court "") than that they are regarded as a Court of a different and exceptional kind. It recognizes, no doubt, that they may have quasi-judicial functions, but that is not sufficient to show that they were regarded as a Court.

I pass to the independent argument founded, on both sides, on sec. 101. That section is contained in Chapter IV., which is headed " Finance and Trade," and deals in substance with the powers of the Parliament and of the States with respect to matters of finance and trade, and not in Chapter III. which is headed '' The Judica- ture."

"such powers of adjudication and administration as the Parliament deems

It provides that the Inter-State Commission shall have

necessary for the execution and maintenance . . . of the provisions

of this Constitution relating to trade and commerce, and of all laws made thereunder." The words "of adjudication and administra- tion" are, in my opinion - to use the artificial terminology by which for many years poor little children were so much perplexed - ' an extension of the object," or, in simpler terms, an adjectival quali- fication of the word " powers." The phrase should therefore be read "'such powers (whether by way of adjudication or administra- tion) as the Parliament deems necessary " for the purpose stated, that is, such powers for the execution and maintenance of the pro- visions of the Constitution and laws made thereunder as Parliament deems necessary. Sec. 61, which is the introductory section of Chapter II., headed "' The Executive Government," provides that the executive power of the Commonwealth extends to the execution and maintenance of the Constitution and of the laws of the Common- wealth. Sec. 101, using the same words "execution and main- tenance," authorizes Parliament to entrust such of the general executive functions of the Government as relate to trade and commerce to the Inter-State Commission, and further to entrust it with powers of " adjudication." It is contended that this power implicitly authorizes the creation of a Court, because the primary, and, in one sense, the sole, function of a Court is to adjudicate. That is no doubt true, but it is not true that the function of adjudica- tion is either by common law or by the course of modern legislation confined to Courts. It has been the practice for many years in the United Kingdom and in the Australian Colonies and States to confer quasi-judicial powers upon officers of Government and administrative bodies. The Board of Trade and Local Government Board are well known instances in the United Kingdom. See, for instances, 9 Edw. VII. c. 44 (Housing, Town Planning &c. Act 1909), secs. 11, 39, by which powers of adjudication are conferred upon local authorities, which are administrative bodies, subject to appeal to the Local Government Board, which is another administrative body, with a further appeal on points of law to the High Court of Justice. Another instance is the London County Council. In the case of R. v. London County Council; Ex parte Akkersdyk (1), A. L. Smith J., delivering the judgment of the Divisional Court, said : - (1) (1892) 1 Q.B., 190, at p. 195.

"In our judgment the London County Council is adjudicating as to whether a man is or is not to be deprived of his licence ; to use the words of Cotton L.J., in Leeson v. General Council of Medical Education (1), ' though not in the ordinary sense Judges, they have to decide judicially as to whether or not the complaint made is well founded'; " and in the rest of his judgment he several times uses the word " adjudicate " to denote their determination on such a matter. The General Council of Medical Education is another well known instance in which an administrative body has power of adjudication, in that case extending to the determination of questions of professional status. In Leeson's Case, quoted by A. L. Smith J. in Akkersdyk's Case, the word " adjudicating'? was used by Cotton L.J., and the word "' adjudication " by Bowen L.J., to denote their functions in such a matter. It is plain, therefore, that the word "adjudication " is well known to lawyers, and regarded as apt to describe the functions of an administrative body entrusted with quasi-judicial powers. On the other hand, no instance has been found in which it has been used by a legislature of the British Dominions to create a Court. In the Bankruptey Acts the word " adjudication " is used in the phrase " order of adjudication," and denotes a particular order called by that name. In Chapter III. of the Constitution different language is used to express the intention of creating a Court.

In my judgment, the functions of the Inter-State Commission contemplated by the Constitution are executive or administrative, and the powers of adjudication intended are such powers of deter- mining questions of fact as may be necessary for the performance of its executive or administrative functions, that is, such powers of adjudication as are incidental and ancillary to those functions. For instance, if a federal law imposed obligations as to structures or appliances to be used in connection with inter-State railway traffic, and entrusted the duty of carrying out those provisions to the Inter-State Commission, it might empower the Commission to determine the question whether in any particular case the provisions of the law had been observed in point of fact, and, if they had not, to demolish the structures or forbid the use of the appliances

contravening the law, and for that purpose to use any necessary force, or to invoke the aid of a Court of law to ensure obedience to its order. The provisions of the Act 9 Edw. VII. c. 44 already men- tioned afford an instance of similar powers of adjudication and enforcement.

For these reasons I am of opinion that the Inter-State Commission is not in any relevant sense of the word a Court.

Tt remains to consider whether the provisions of sec. 23 are so far separable from the rest of Part V. that without them the re- mainder of the Part would be substantially the same law. In my judgment they are not separable. It is impossible to say that a law conferring executive powers upon an instrumentality of the Government with incidental powers of adjudication for the purpose of administration is not substantially a different law from a law creating a Court of Justice and defining its jurisdiction.

For these reasons I am of opinion that the whole of Part V. of the Act is invalid, and that the question must be answered in the negative. This is enough to dispose of the appeal.

It would, however, have been a misfortune if the other important questions raised in the case should be unanswered. This misfortune has been avoided by the action of the Commonwealth, which, acting upon a suggestion made from the Bench, has since the opening of the argument issued a writ against the State of New South Wales and the Inspector-General of Police of that State, claiming a declara- tion that the Wheat Acquisition Act is ultra vires of the State, and an injunction against infringing sec. 92 of the Constitution. This Court undoubtedly has jurisdiction to entertain that suit and to grant the injunction asked for. It was agreed by all parties that in the event of the Court holding that the Inter-State Commission had no jurisdiction in the matter the argument should nevertheless proceed as on a motion by the Commonwealth for an injunction in the suit treatéd as the hearing of the cause on the facts stated in the case.

I proceed, therefore, to deal with the question of the validity of the Wheat Acquisition Act.

That Act, which was passed on 11th December 1914, enacts by

sec. 3 that the Governor may, by notification published in the Gazette, VOL. XX. 5

H.C. or A. declare that any wheat therein described or referred to is the property

ee of His Majesty, and that upon such publication the wheat shall Tux Stare become the absolute property of His Majesty, and the proprietary

eeSbelad tights of every person in the wheat at the date of publication shall Waters be taken to be converted into a claim for compensation in pur- Tue Com- guance of the provisions of the Act relating to compensation, to

Wg The Act was passed in attempted exercise of the power to expro- MONWEALTH

oe priate private property, which is generally, and I think rightly, oe Nae regarded - to use the apt words of an American Court (see Cooley

aed on Constitutional Limitations, 7th ed., p. 753n.) - as a power inherent

ees in sovereignty. In my judgment the only condition of its exercise is that the property, whether real or personal, shall at the moment of the exercise of the power of expropriation be within the territorial limits of the State. The Commonwealth contends that this right is controlled by sec. 92 of the Constitution, which provides that "On the imposition of uniform duties of customs, trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free."

This provision is equally binding upon the Commonwealth and the States. The language is plain enough, and the words " absolutely free " cannot be qualified as to anything which is within the subject matter of the enactment. The real question to be determined is what is that subject matter.

The argument for the Commonwealth is that the words of the Act authorize the State of New South Wales to acquire the whole of the wheat in the State, and were intended to be (as they have in fact been) used for that purpose, that such an acquisition would have the necessary result of preventing the performance of any existing contracts for the sale of wheat in New South Wales to be exported to another State, and that such a result is a contravention of the provision that trade, commerce and intercourse among the States shall be absolutely free. It may be conceded that such prevention was a contemplated, if not the necessary, result of the acquisition ofall the wheat. This argument, if valid, would, in effect, invalidate any State law couched in general terms for the expropriation of personal property, unless it contained an exception of any such

property which might at the time of the attempted exercise of the power be the subject matter of inter-State commerce. In my judgment the well known case of Macleod v. Attorney-General for New South Wales (1) affords a complete answer to this argument. The general power of expropriation is a power which is by the Constitution neither withdrawn from the States nor exclusively vested in the Commonwealth. It, therefore, by virtue of sec. 107 of the Constitution, continues as at the establishment of the Com- monwealth. When a State law is enacted in general terms, I do not think that it can be held invalid merely because its language is wide enough to cover cases with which by reason of some provisions of the Constitution it is beyond the competence of Parliament to deal. In such a case I think that, as a matter of construction, the Act should be construed as applying only to matters within the com- petence of Parliament, just as in the case of a Statute which in its terms includes matters beyond the territorial jurisdiction of the State, unless it appears on the face of the Act that it was intended to deal with matters beyond, as well as with matters within, the competence of Parliament, and that the provisions dealing with both are not severable (The Kalibia Case (2) ). It follows that in such a case the Statute should be construed as limited in its operation, not that it is invalid altogether.

The real question upon which the validity of the Wheat Acquisition Act depends turns upon the meaning of the words in sec. 92 describ- ing the subject matter of that section, which may be conveniently spoken of as " inter-State commerce." We listened to an interesting argument as to the time at which goods become the subject of "inter-State commerce " as that phrase is understood in the United States of America, but I am unable to derive any assistance from the decisions of the Supreme Court of the United States on this point. In the present case the relevant point of time is not when goods become, but when they cease to be, the subject of inter-State com- merce. The term "commerce" assumes the existence of persons willing to engage in it, and who are the owners of property which is to be the subject of it. The title to property is governed by State Jaw, and, in general, the right of the owner to dispose of his property

Tur Com- MONWEALTH vw Tue State or New Sourn WaLEs.

is also governed by State law. The right to control such disposition is limited by sec. 92 of the Constitution. But that section has - nothing to say to the question of title. The duration of the power of disposition, which depends upon title, is coextensive with the - duration of the title itself, and ceases with it. There cannot there- fore be any conflict between the law of title and the law of disposition, and a law which deprives a man of the ownership of property does not interfere with his power of disposition while owner. Sec. 92 may, therefore, so far as it relates to commerce, be paraphrased thus : Every owner of goods shall be at liberty to make such contracts for the transportation of goods from one State to another as he thinks fit without interference by law. It follows, that as soon as he ceases to be the owner of goods the section ceases to have any operation so far as those goods are concerned.

When the wheat in New South Wales became the property of His Majesty, the Sovereign, as the new owner, had the exclusive right of disposing of it. If the Government desired to export it to another State they were free to do so. Whether they did or did not, their power of disposition was not interfered with.

This view is amply supported by the opinion of most eminent members of the Supreme Court of the United States if it were necessary to have recourse to them for support.

I pass to a subsidiary objection to the Act founded upon sec. 8, which provides that '' Every contract made in the State of New South Wales prior to the passing of this Act, so far as it relates - to the sale of New South Wales 1914-15 wheat to be delivered in , the said State, is hereby declared to be and to have been void and of no effect so far as such contract has not been completed by delivery."

It is contended that this section offends against sec. 92 of the Constitution by attempting to cancel contracts relating to the sale of wheat for exportation to another State, as for instance a contract : to deliver wheat on board a ship or railway truck or to a carrier in New South Wales for transportation to another State. :

The provision is in its terms limited to contracts for the sale of © wheat to be delivered in New South Wales. As a matter of con- struction, I think that the contracts meant are contracts under the -

terms of which the obligations of the vendor so far as regards

delivery are to be completed by transfer of possession from him to H- ©. or A.

the purchaser in New South Wales. The section does not, therefore, Bee

operate to affect the validity of contracts the subject matter of Tum Srarn

which has come into the possession of the purchaser. If that pur- on Naw

chaser desired to dispose of the wheat by exportation he could do wa

so as long as it was his, but after it became the property of His Tue Com- i 5 . MONWEALTH. Majesty his wish became irrelevant, and his power ended. It is

quite immaterial whether at the moment of acquisition by His Perea

Majesty the property in the wheat contracted to be sold had or'had » si : Tur Stare

not passed to the purchaser. In either case the ownership, and with or New : aaaEGE Sours it the power of disposition, came to an end. pase

Sec. 8 has no application to a contract for the sale of wheat tobe , a5 y, delivered in another State. In such a case, if the wheat had been transported to the other State, the Act did not affect it. If it had not, the Act deprived the owner of his ownership on which his

power of disposition depended. I am therefore unable to see any ground for holding that this section offends against the provisions of sec. 92 of the Constitution. But if it did I think that it is clearly severable from the other provisions of the Act. The apparent object was to relieve persons who by reason of the acquisition of wheat by the Government had become unable to perform their contracts from the hardship of leaving them liable to actions for damages. If there were some cases of hardship which it did not cover, that is no reason for saying that it is invalid altogether.

I have not thought it necessary to deal with the arguments founded upon the actual conditions (of war) existing when the Act was passed, and the alleged, and indeed admitted, intention of the Government to prevent the exportation of wheat from New South Wales. Those conditions and that intention may be relevant to the propriety of the action of the New South Wales Parliament, which is a question of politics, but have no relevance to the question of its power to enact the law, with which alone the Court is concerned.

For these reasons I am of opinion that the Act is valid, and the Commonwealth's action fails.

Barron J. I think sec. 101 of the Constitution should be read as it stands, and not as if the words following the word " necessary "

were at the beginning of the section, instead of being, as they are, at its end. But I am not sure that the suggested transposition of the terms of the section would work any material change in its meaning. The powers of adjudication and administration which the Inter-State Commission is to have are to be such as the Parlia- ment deems necessary for a particular and specific purpose, namely, the execution and maintenance within the Commonwealth of the trade and commerce provisions of the Constitution and of all valid laws made by virtue of those provisions. If there is any adjudi- catory or administrative power which the Parliament deems neces- sary for those purposes the Parliament has authority to bestow it on the Commi: discretion ; that is to say, the Parliament alone, and not this Court, is to decide whether any power of a specified kind is necessary for the specified purpose. Provided only that the power be adjudica- tory or administrative, its necessity for the execution and main-

ion. In this respect the Parliament is given an absolute

tenance of the Constitutional provisions indicated and of the laws made or to be made within them is for the determination of Parlia- ment, and must not be questioned by any Court. Once the Parlia- ment has exercised its judgment in that regard it may choose the kind of adjudicatory or administrative power which it prefers to allot, and none may say it nay.

By way of parenthesis I would say that the powers of adjudication given by the Parliament need not be merely incidental to the powers of administration. The contention that they must, rests on a strained construction not supported by the order observed or the natural meaning of the terms employed.

In exercising this liberty of choice, there is nothing to confine Parliament to the setting up of any particular method of adjudica- tion. The instances are frequent in which adjudicatory powers are given by English Acts of Parliament to arbitration bodies, to Local Government authorities, and their like. They are given by such an Act to the Railway and Canal Commission, which is undoubtedly a Court. It may therefore be conceded, as the learned Chief Justice has stated, that it is not true that the function of adjudication is, either by common law or by the course of modern legislation, confined to Courts. As obviously, it is not confined to

bodies which are not Courts. At common law the parties could always refer matters to an arbitrator, whose determination, after hearing both parties. was and is in the natural sense adjudication. But to say that this function is not confined to Courts appears to me, speaking with great deference, not materially to affect the question. Adjudication is a function common to Courts and many other bodies, whether existing under the common law or under legislation. But when a Parliament is authorized by Statute to confer such powers of adjudication as it pleases upon a contemplated body, it seems to me clear that Parliament can choose for itself whether or not it will give that body the status of a Court for the more effective fulfilment of its prescribed purpose. If this view is correct, the Parliament, in giving the Commission the status and some of the powers of a Court, has acted in exercise of a discretion expressly committed to it, an exercise which this Court cannot dispute or frustrate except in obedience to some controlling context. The opposite contention amounts to this, that Parliament was bound to withold any status or power of a Court from a body which was to perform the extremely important functions which the framers of the Constitution declared that this Commission was to exercise, the nature of those functions being such that many of them could only be exercised inter partes. I cannot think that it was so bound. The Parliament has said by its Statute that these functions or some of them can be best exercised by the Commission as a Court. Even if one thinks otherwise, his opinion avails nothing, for the Constitu- tion has made the Parliament the sole arbiter of that question, if sec. 101 is to prevail.

So much at least I hold as the true construction of this section, considered by itself, upon the natural and ordinary meaning of its words. It remains to be seen whether the discretion given to the Parliament, and which it has exercised in terms which purport to constitute a Court, is controlled by the context; that is to say, by any other provision or provisions of the Constitution.

Adjudication for the execution and maintenance of provisions of law is a plain enough expression. A Court, according to its functions, is in its adjudications executing and maintaining, or, in other words, enforcing and upholding those provisions. But the

'Tue Com- MONWEALTH vw Tue State or New Sourn Wates.

same words, "execution and maintenance" of the Constitution, and of the laws of the Commonwealth, are used of the executive powers of the Commonwealth in sec. 61, and it is argued that their use in that connection indicates that as used in sec. 101 they give the Inter-State Commission only executive functions to perform, to which its adjudicatory powers must be merely incidental. I do not accept that contention. Both Courts and Executive Governments are to execute and maintain, or, if equivalent terms are preferred, enforce and uphold the laws of which they are the guardians. They do so by differing means and processes. To say that powers of adjudica- tion, when applied to the execution and maintenance of laws by that which is to be a tribunal, are necessarily to be taken as powers merely analogous or equivalent to those of an Executive Govern- ment, is, in my humble judgment, not by any means a clear conclu- sion. I say this with great respect to the able counsel who have so

But a more powerful contention was founded upon the third Chapter of the Constitution, headed "The Judicature ;" sec. 101 being on the other hand one of the provisions placed under the head- ing of "Finance and Trade" (Chapter IV.). It was said that Chapter III. covered the whole ground of the judicial power of the Commonwealth, and that sec. 101, being entirely apart from that Chapter, could not be said to authorize the giving of any judicial power to the Inter-State Commission.

Holding the opinion above expressed as to the true construction of sec. 101, taken by itself, I am further of opinion that the power given to Parliament in that section is independent of the powers given in the Judiciary Chapter properly so called. Chapter II. relates to the composition, attributes, and functions of the general judiciary, whether the tribunal in question be the Federal Supreme Court designated the High Court, or some other federal Court created by the Parliament, or any other Court not created by Parliament, but invested by it with federal jurisdiction (sec. 71).

There is provision in sec. 72 as to the appointment, the tenure and remuneration of the Justices of the High Court or of the other Courts created by the Parliament, such other Courts obviously meaning the " other federal Courts "

appellate jurisdiction of the High Court is dealt with in sec. 73, and embraces, subject to Parliamentary exception and regulation, appeals from "all judgments, decrees, orders, and sentences " of enumerated Courts (sub-secs. 1. and 1), and, as to questions of law only, of the Inter-State Commission (sub-sec. m1.). I shall return to sub-sec. m1. presently. Sec. 74 relates to the right of the Sovereign to grant special leave of appeal from the High Court save in certain Constitutional cases, in which no appeal is to be permitted except upon a certificate granted for special reason by this Court. Secs. 75 and 76 relate to the original jurisdiction of the High Court, the first of them giving such jurisdiction in enumerated matters, and the second enabling Parliament to give such jurisdiction in other enumerated matters. Sec. 77 gives the Parliament power to make certain provision as to jurisdiction with respect to the matters mentioned in secs. 75 and 76, but without. extending the subject matters of jurisdiction prescribed in those two sections. Secs. 78, 79 and 80 affect the matters now in question only remotely, if at all.

Under this Chapter the general judiciary system of the Common- wealth is provided for, and it has no relation to tribunals instituted or appointed for special purposes and confined in their jurisdiction to the enforcement and upholding of any special and limited class of laws. The body upon which it is the object of sec. 101 to enable the Parliament to confer such powers of adjudication as it deems necessary for stated purposes, is on the other hand treated of in sec. 101, which confines the. functions of that tribunal, whether made by Statute a Court or not, to the upholding and enforcement of a certain class of laws, whether fundamental or statutory, which are dealt with in Chapter IV., and it seems evident enough that the framers preferred to place in this Chapter, along with the trade and commerce provisions, those relating to their protection and enforcement by the Inter-State Commission, - its powers, and their purposes. To have embodied these in Chapter III., divorced from the trade and commerce provisions themselves, would have been ungainly and without clear reason, for it would not have been in consonance with the more general purposes of Chapter IIT. It was not intended, in my judgment, to make the Inter-State

Tue Com- MONWEALTH, v Tue State or New Sourn Wates.

Commission a federal Court as a part and in the sense of the scheme embodied in Chapter III. Whether it was to be a Court in the ordinary acceptation of the term or not, was left to Parliament to decide, and hence it would have been absurd to place it amongst the Courts ordained outright in Chapter II., since the Constitution left the question of Court or no Court to a Parliament which could not exist until the Constitution came into being. The Inter-State Commission, so far as the frame of the Constitution is concerned, was not necessarily to be a Court. That was to depend on the judgment of Parliament, exercising its wisdom in relation to the purposes to be secured. And it is manifest that it was a matter of common sense to leave the kind of adjudicatory power to Parlia- ment, because the provisions of the Inter-State Commission Act, exercising fully or only partly the Constitutional powers of Parlia- ment in that behalf, might in their view require the adjudicating tribunal to be invested with the full status of a Court, or with a lower status. So the framers placed sec. 101 where it seems to me they ought to have placed it, among the trade provisions, and not as part of a scheme to which it did not in reason belong, especially as it was not then known whether it would need to be a Court or not. It was intended that the Parliament should be able to give the Commission adjudicatory powers according to the importance and scope of the Act which it alone could pass. Parliament would thus be able to give the Commission a higher or a lower status than that of a Court, according as the higher or a lower status would be commensurate with or sufficient for the full or the limited exercise of the powers deemed necessary "' for the execution and maintenance &e." by the Legislature at the time of enactment.

I am therefore of opinion that as the necessity for a Court or a less important adjudicative body depended on the quantum of legis- lation yet to be, the power given to Parliament was entirely supple- mental and apart from Chapter II1., though it might result in the establishment of a Court.

Mr. Knox based an alternative argument upon the use of the word "adjudged " in sec. 102 and on the third sub-section of sec. 73, and urged that in view of these provisions and the force of the word

"adjudication " in sec. 101 the Commission might be considered a

" federal Court " within the meaning of Chapter IIL. If I am right in thinking that the quantum of adjudicative power and the degree of status and authority necessary for its exercise were left to the discretion of Parliament, I cannot think that it was also intended that the Commission must be a federal Court of the character con- templated in Chapter III. The scheme of that Chapter is self- contained. Sec. 73 relates to the powers of the High Court, not to those of the Inter-State Commission. The Commission's decisions

on questions of law might no doubt be expressed in " orders," whether they were "judgments, decrees and sentences" or not ; but they might still be those of a body which Parliament might either make a Court or a tribunal less than a Court ; endued never- theless with some power of adjudication.

T am of opinion that Chapter III. does not afford a context "equally clear" to control what I take to be the unambiguous meaning of sec. 101.

Tam in agreement with the learned Chief Justice in thinking that Part V. of the Inter-State Commission Act, No. 33 of 1912, purports to make the Commission a Court in the ordinary acceptation of that term, with many powers such as ordinarily belong to Courts, in addition to purely administrative powers conferred by the same Statute, but all for the purposes limited by sec. 101 of the Constitu- tion; and from what has been already said, it will be seen that while his Honor thinks that the Parliament could not validly make these - shall I say, curial ? - provisions, I respectfully think that it could.

The power to hear and determine controversies inter partes and to grant consequent relief is in my view validly giver to the Com- mission as a Court, because so far as I can see it is confined to the purposes defined in sec. 101 of the Constitution.

I shall not deal in detail with the various sections of this part of the Inter-State Commission Act, but shall content myself with the opinion I have expressed as to their substantial effect.

The fact that by sec. 4 in Part II. of the Act the Commission is to be a body corporate does not, I think, affect the present question. The provision was no doubt intended to facilitate the performance of the administrative part of the Commissioners' duties. Its

H.C. or A. occurrence in an enactment which at the same time gives it the 1915.

_~ . . Tue Stare the latter powers. If Parliament has, as I think it has, made the

sana Commission a Court of limited function, but still a Court, that

iain exercise of legislative power is not shaken by such a provision as

Tax Com- is contained in sec. 4 of the Act of 1912. MONWEANTE: T must not omit to mention an argument based on sec. 103 of the

adjudicatory powers of a Court does not seem to impair the grant of

Tue CoM- Constitution. That section is, save in one particular, couched in MONWEALTH : ei i v. terms substantially, and almost verbally, identical with those of sec.

Re Naa 72. The members of the Inter-State Commission, like the Justices

aur mentioned in sec. 72, are to be appointed by the Governor-General

- in Council. Like those Justices, they are removable during their tenure only on an address from both Houses of Parliament in

the same session on the ground of proved misbehaviour or incapacity. They, as well as the Justices, are to receive a remuneration, fixed

by Parliament but not to be lessened during their continuance in office. The one difference is that, subject to removal in the con- tingency indicated, the Justices mentioned in sec. 72 may hold office

for life, while the Commissioners can only hold office for seven years.

It was said that this difference indicated that the Commissioners must not be made members of a Court for the purposes of sec. 101. Tam not of that opinion. Sec. 103 is a strong provision for the independence of the Commissioners, and is such a provision as the framers might in their wisdom deem to be sufficient for the purposes

of sec. 101, whether the Commission was to be made a Court by subsequent Statute or not. I think it shows nothing to the purpose of the objectors. For sec. 103 does not, either of itself or when read with Part IIL, afford the context which the attack upon the jurisdice- tion appears to me to need for its support.

In the construction of sec. 101 of the Constitution one should bear in mind that this Court is not considering the limits inter se of the Constitutional powers of the Commonwealth and of any State, or any question of conflict of powers between Commonwealth and State. The limitations under which the Constitutional powers are to be interpreted where questions of that class arise, as in the Railway Servants' Case (1) and many other cases here, and in the

Sugar Company's Case (1), do not impede us in giving full value to the terms of sec. 101.

On the question of the validity of Part V. of the Inter-State Commission Act, which, if not valid, gives the Commission no power to make as a Court the order complained against, I am against the appellants, the defendants below, and think the case should be determined upon the question of the validity of the Wheat Acquisi- tion Act.

Inasmuch, however, as it has been agreed by all parties that the validity of the Wheat Acquisition Act may, if necessary, be determined upon the action instituted by the Commonwealth in this Court, that question can now be dealt with irrespective of the objection to the jurisdiction of the Commission.

I proceed to discuss the question vital to the decision of the case on the merits, namely, the validity of the Wheat Acquisition Act. The action can only succeed if this Act is invalid. I am of opinion that it is valid. The power of the State to pass it is impeached on the ground that its necessary consequence is the infraction of sec. 92 of the Constitution.

The power of the State to expropriate real property by Statute is in these days never questioned. If the power to expropriate personal property is questioned as to any Australian State, it can only be because its exercise has been so rare that its novelty rather exposes it to criticism and opposition. But a power newly used is nevertheless a power. If the property is taken without compensa- tion, that is to say, if it is confiscated, the question which arises is constitutional only in the political and not in the legal sense. In other words a Statute passed by a Sovereign Parliament is equally within the legal rights of the Legislature whether it nakedly con- fiscates property or takes it upon terms of payment more or less. That is the position in the United Kingdom, and the right flows from the Sovereignty of Parliament, and does not depend for its defence upon the doctrine called " eminent domain."

The Constitution of New South Wales was at the establishment of the Commonwealth, and is now, preserved by sec. 106 of the Federal Constitution, subject to the latter Constitution. The New South

'Tue Com- MONWEALTIE v Tue State or New Sourn Wates.

H. C. or A. 1915. yw Tue Stare or New Sourn Wates v Tue Com- MONWEALTH.

Wales Constitution Act empowers the Parliament of that State to make laws for its " peace, welfare, and good government in all cases whatsoever." The grant includes of course the power of expropria- tion (or eminent domain, if that term is more pleasing), according to the sole judgment of the Parliament of the State on the question of the public welfare. In some of the States of the American Union the power of expropriation is limited by their Constitutions to acquisition on just terms. So in our Federal Constitution not only must the terms be just, but the power is limited to the purposes in respect of which the Parliament has power to make laws: Con- stitution, sec. 51, sub-sec. xxx1. Whether there is or is not in that instance a power of eminent domain also, I do not discuss now. But the power to make laws is unlimited in New South Wales save by territorial jurisdiction, and, since January 1901, by the Federal Constitution in some respects.

The question between confiscation and " taking on just terms" is therefore merely political in this case, and so also are the questions whether compensation ought to be given at all, and whether terms affecting to be just are so or not. I am clearly of opinion that in respect of property real or personal, the power of the Parliament to assume or resume that property is as absolute quoad New South Wales as the power of the Parliament of the United Kingdom in its sphere, with this qualification only, that the power of any State of the Commonwealth must be exercised subject to the Federal Constitution.

Is there anything in the Federal Constitution which vests the general power of expropriation in the Federal Parliament exclusively, or withdraws it from the Parliament of the State? See sec. 107. Clearly there is not anything, and therefore the power continues, unless its exercise constitutes an infraction of some other provision in that charter. In this case the provision alleged to bar the full exercise of the power is sec. 92. Does that section set a limit, and if so, what limit, upon the exercise of the otherwise clear power to take wheat or any other property ?

What the Wheat Acquisition Act purports to do is to change the ownership of wheat upon Gazette notice by the Governor in Council, issued in accordance with the statutory provision. On publication

of such a notice the wheat becomes the absolute property of the King, and the rights and interests of every person in that wheat at the date of publication are taken to be converted into a claim for compensation. The owner, therefore, is entitled to the compensation fixed, in place of the wheat, and to no more.

It was argued (1) that the taking authorized by the Act is of itself an infraction of sec. 92, whether the wheat be in actual transit, or be the subject of contract for sale, or not ; (2) that at least the taking is such an infraction where the wheat is at the time the subject of inter-State trade ; (3) that the wheat is the subject of inter-State trade not only when in actual transit, but when its sale and delivery for transport into another State have been contracted for, and that it is then not subject to obstruction in the course of that trade even by a State changing its ownership.

The first of these contentions was not strongly persisted in. As to the second, the respondents, who were complainants and interveners respectively before the Inter-State Commission, have delivered able and exhaustive arguments to this Court, and have cited a large number of cases from the United States Reports. It is not necessary, in the view I take, to examine the correctness of those decisions. (It may be repeated, in passing, that the decisions of that great Court do not bind us as authorities, although they are often supported by powerful reasons, and especially we have given great weight to such reasons where the subject matter of decision has been the construction of expressions in the United States Con- stitution identical with, or clearly equivalent to, expressions in the Australian Constitution the meaning of which has been represented as doubtful. In this case, even if the decisions cited are accepted as correct, they do not support the Commonwealth and the Farmers and Settlers Association of New South Wales in the position which they take up.

Sec. 92 appears to me to have been framed to secure the owner of any commodity in exercising his dominion over it in the way of sending or transporting it from State to State, without obstruction on the part of Commonwealth, or State, or any other authority or person. If the owner has contracted to sell it, but the property has not passed, he is the person protected in respect of his dominion

'Tue Com- MONWEALTH vw Tue State or New Sourn Wates.

H.C or A. over it. If one that was the owner has sold it so that the property 1915.

ae dominion that is the subject of protection. If the ownership Chea changes under agreement, the protection passes to the new owner, parse still in respect of his dominion. No matter to whom any Statute Tur Com- gives the right to sue or the liability to be sued, it is this dominion

in it, with or without the possession, has passed, it is still the owner's

ALTH. ee Bay oeee which is safeguarded by sec. 92, and the real dominion is in the THE COM- owner, MONWEALTH wi :

v Here the Statute converts the dominion of the owner into the Tue STATE ¥

or New dominion of the State. It is no answer to the effect of that change of

ae dominion to say that the sale is not voluntary. The protection <a given by sec. 92 to the dominion of the old owner is lost to him, arton J. &

and becomes a protection to the dominion of the new owner, whether State or ordinary citizen. It would be a strange thing to say that sec. 92 means that a protection given in respect of dominion is re- tained by him who lost that dominion under the law, or to say that liability instead of protection is the lot of him to whom the law gives the dominion.

But it is said that, whatever may be the effect of sec. 3 alone, sec. 8, the other crucial section of the Wheat Acquisition Act, renders the Statute invalid. Now sec. 8 only avoids contracts of sale pre- ceding the Act, and then only so far as they have not yet resulted in complete delivery. Besides being confined to sales of 1914-15 wheat grown in New South Wales, it is further confined to sales of that wheat to be delivered in New South Wales. Where the contract has been "completed by delivery " there is no longer a sale, and sec. 8 has no application. The wheat has passed to a new owner ; and it is clear from the terms of this section that it relates only to contracts for sale in respect of wheat still deliverable under the contract, and does not touch any dominion and ownership remaining in the contracting owner. It simply annuls his contract to complete the delivery. Where, or to the extent that, the delivery is incomplete, the contract is unfulfilled and the ownership remains where it was} that is, so far merely as sec. 8 is concerned. A contract for the sale of property, whether movable or immovable, situated within the - territorial limits of a State and to be completed within the same State by delivery or its equivalent, has always been deemed without

question to be subject to no legislative control except that of the H. ©. or A. State. If, however, there is any class of such contracts which, eee though the Wheat Acquisition Act might possibly be read to Tux Srare embrace them, the Constitution impliedly forbids by sec. 92, the NEW Wheat Acquisition Act must be read as not embracing them, because wane such a construction is reasonable and the State Legislature appar- Tux Com- ently intended the law to apply only to cases within its legislative rai Sbrsiw domain: Macleod v. Attorney-General for New South Wales (1). oe eS Tf the meaning of sec. 92 is as I have indicated, cers is nothing eee, here incompatible with that Constitutional provision. No owner - or New is deprived of the benefit of sec. 92 so long as his ownership, which it aoe is not for the Commonwealth to regulate, lawfully exists. Each suecessive owner during his ownership is entitled to the same benefit. It makes no difference in the operation of sec. 92 that the ownership

passes to a State and not to a private citizen. It can transfer all

or any of the wheat or not across the border as seems good to it, just as any citizen of New South Wales could who had bought and taken delivery of that wheat or any part of it from a previous owner or owners in the same State.

It may be that the avoidance of certain contracts is unjust. Opinions on such a question are not for the Courts. Nor have we anything to do with the motives of legislators. The Constitution of New South Wales gave power to pass this section, and there is nothing in sec. 92 to render it an invalid provision unless that section has some meaning which has not yet been fathomed.

The object of sec. 8 appears clearly to be the protection from law- suits of owners who have been prevented by the operation of a notice under sec. 3 from fulfilling their contracts of sale. It may or may not have been right to free them from the consequences of the failure to fulfil. How can a Court pronounce on that? The Statute, in avoiding the contract, frees the seller from liability for his inability to complete his contract, presumably because the inability is caused by the State's own action without any fault of the seller. If it is arguable that this isa wrong, it is as a political and not as a legal wrong, and this is not the place to discuss it. The provision does not run counter to sec. 92, because, as the Chief

Justice observed during the argument, the Constitutional provision -

and the whole of the State Statute are of widely different scope and legal subject matter. As he said, with clear correctness if I may say so, they are on parallel lines, and the one cannot touch the other.

For the above reasons I think that the Wheat Acquisition Act is valid, and that the petition and action of the Commonwealth must be dismissed.

Isaacs J. Questions of vast importance present themselves for consideration.

- The first arises upon the contention on the part of the State of New South Wales that sec. 31 of the Inter-State Commission Act 1912, under which the injunction was issued by the Commission, is invalid.

The ground of that contention is that the power of injunction given to the Commission by the Act is given as a strictly curial power, a "process" as it is called in sec. 31, that all the judicial powers created by Part V. are conferred on the Commission in the character of a Court of Justice in the strict sense, and that this is contrary to the proper intendment of the Constitution, and therefore invalid,

The provision in Part V. constituting the Commission a Court of record, in the terms by which "jurisdiction" is conferred, the authority to grant "relief" given, the avoidance of State regula- tions provided for, and penalties and the enforcement of the orders of the Commission prescribed, and in the terms by which all ordinary judicial ancillary procedure is enacted, leave no doubt whatever that the judicial powers entrusted to the Commission are in fact entrusted to it in the capacity of a Court of Justice, and not other- wise.

It was not contested on behalf of the Commonwealth that this was the effect of Part V., and that the grant of the powers therefore is inseparable from the character of the Court of record which Parliament intended to exercise them. The true test of the sever- ability of invalid legislative provisions from the rest of the enactment will be more conveniently stated presently, but applying that test to Part V. internally, sec. 42 is involved in the invalidity. That is the section under which the rule of Court was framed, providing for

the case stated which we have before us. The circumstance, however, is immaterial. If sec. 42 disappears, as part of the scheme, the only result is that the general right of appeal given by sec. 73 of the Con- stitution in matters of law stands unabridged. The writ issued under the original jurisdiction of this Court, though the Commission is not a party to the action, is also sufficient in itself to enable the Court to determine the question as between the litigants themselves.

It is desirable to add at this point that applying the same test of severability to Part V. externally, that is, in its relation to Parts L, IL, IIT. and IV., for instance, and certainly some parts of Part VI., those other Parts are not thereby infected with illegality.

As the ultimate test for determining whether after discarding invalid portions of a Statute the portions that remain are to be re- garded as law or not, I apply the rule I have stated in Osborne's Case (1) and the cases there cited. It is like the case of various promises in a contract apart from questions affecting the considera- tion. " Where," says Lopes L.J. in Kearney v. Whitehaven Colliery Co. (2), "some of the provisions are legal and others illegal, the illegality of those which are bad does not communicate itself to, or contaminate, those which are good, unless they are inseparable from and dependent upon one another."

The first question, then, comes to this : - Has the Commonwealth Parliament power under sec. 101 of the Constitution to create the Inter-State Commission a Court of Justice, that is, a federal Court in the strict sense, and to invest it with judicial powers on that basis ?

If it has not, then no matter how far the State of New South Wales infringed sec. 92 of the Constitution, the Commission had no power to grant the injunction. The matter must in that case be left to the ordinary Courts of law. &

The main, and almost the sole, support of the contention on the part of the Commonwealth and the owners of the wheat that the Commission was validly created a Court of Justice, really rested on the word " adjudication " in sec. 101. It was said that the primary and natural signification of that word connotes a Court of Justice. But in 1900 when the Constitution was framed the word " adjudica-

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