Queensland Electricity Commission v Commonwealth - [1985] HCA 56 - HCA 1985 case summary — Zoe

CTHHCA

Queensland Electricity Commission v Commonwealth

[1985] HCA 56

High Court of Australia|1985-05-31|Before: Dawson JJ

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Court

High Court of Australia

Decision date

1985-05-31

Before

Dawson JJ

Source

Original judgment source is linked above.

Judgment (230 paragraphs)

[1]

The application of the Act to persons described in par. (d)(ii) of the definition of electricity authority is modified by s. 6(5), which provides: This Act applies by virtue of sub-section (2) to an industrial dispute between an organization of employees and a person referred to in sub-paragraph 4(1)(d)(ii) only in so far as the industrial dispute relates to work referred to in that sub-paragraph. However, the Act has no present application to any dispute of the kind mentioned in s. 6(2), since, so we were informed, no regulations have been made under s. 10 of the Act, and accordingly there is no organization of employees to which s. 6(2) applies. The Act at present applies only to the dispute mentioned in s. 6(1). The Act ceases to be in force three years after its commencement, or earlier if an appropriate proclamation is made: s. 11.

[2]

The Queensland Electricity Commission and the Electricity Boards are all "electricity authorities of Queensland" within the meaning of the Act. The Queensland Electricity Commission is a corporation sole constituted pursuant to s. 9 of the Electricity Act 1976 Q, as amended, and represents the Crown in right of the State of Queensland: s. 9(3) of the Electricity Act. The Electricity Boards are bodies corporate constituted pursuant to ss. 101-103 of the Electricity Act. It is expressly provided by s. 102(2) of that Act that an Electricity Board does not represent the Crown. However, important powers, functions and duties - including the duty of supplying electricity to consumers within its area - are conferred on each Electricity Board (see s. 129 of the Electricity Act) and other sections of the Act reveal that each Board acts substantially under governmental control - see particularly ss. 36D, 64, 105, 118-119, 434-435 and 441 of the Electricity Act. With certain exceptions, all electricity generated for distribution to consumers in Queensland is generated by the Queensland Electricity Commission, is distributed by the Queensland Electricity Commission to one or other of the Electricity Boards and is distributed by an Electricity Board to consumers in its area. The exceptions are stated in detail in the amended statements of claim. In some areas some electricity is supplied to the appropriate Electricity Board, under agreements made pursuant to s. 67 or s. 171 of the Electricity Act, by certain owners of generating plants - namely, in various areas, A. G. Raptis (Karumba) Pty. Ltd., various sugar mills, Mount Isa Mines Ltd., Consolidated Fertilizers Ltd. and the Brisbane City Council. The South-West Queensland Electricity Board is supplied with some electricity from the Electricity Commission of New South Wales pursuant to an agreement under s. 36C of the Electricity Act. Under s. 150 of the Electricity Act the Council of the Shire of Tenterfield in New South Wales and the Council of the North-West County District of New South Wales are constituted electricity authorities for the purposes of the Electricity Act and supply electricity to the areas of Queensland referred to in s. 150. During the period of three years ended 30 June 1984 the Queensland Electricity Commission has always generated more than 97 per cent of the total electricity supplied to consumers in Queensland; each of the other bodies which generated electricity produced a very small proportion of the whole.

[39]

It is now clear in principle, and established by authority, that the powers granted by s. 51 of the Constitution are subject to certain limitations derived from the federal nature of the Constitution. The purpose of the Constitution was to establish a Federation. "The foundation of the Constitution is the conception of a central government and a number of State governments separately organized. The Constitution predicates their continued existence as independent entities": Melbourne Corporation v. The Commonwealth [3] . The fundamental purpose of the Constitution, and its "very frame" (Melbourne Corporation v. The Commonwealth [4] ), reveal an intention that the power of the Commonwealth to affect the States by its legislation must be subject to some limitation. The judgments in Melbourne Corporation v. The Commonwealth were fully examined in Victoria v. The Commonwealth [5] and the majority of the Court in the latter case (Menzies, Windeyer and Walsh JJ. and myself) held that what was decided in the earlier case was that although s. 48 of the Banking Act 1945 Cth was, or might be, a law with respect to banking within s. 51(xiii) of the Constitution, it was invalid because it exceeded the limits on the lawmaking power of the Commonwealth which must be implied in the Constitution. It was recognized that it is not easy to formulate exhaustively and authoritatively the limitations that must be implied, and, indeed, it is undesirable to attempt to do so in the abstract. It is clear, however, that there are two distinct rules, each based on the same principle, but dealing separately with general and discriminatory laws. A general law, made within an enumerated power of the Commonwealth, will be invalid if it would prevent a State from continuing to exist and function as such. Clearly the Act is not a law of that description and it is unnecessary to consider further that aspect of the principle. A Commonwealth law will also be invalid if it discriminates against the States in the sense that it imposes some special burden or disability on them. In Melbourne Corporation v. The Commonwealth, Dixon J. said [6] : "But, to my mind, the efficacy of the system logically demands that, unless a given legislative power appears from its content, context or subject matter so to intend, it should not be understood as authorizing the Commonwealth to make a law aimed at the restriction or control of a State in the exercise of its executive authority." He went on to say [7] , that s. 48 of the Banking Act was "a law directly operating to deny to the States banking facilities open to others, and so to discriminate against the States or to impose a disability upon them". The nature of a law which infringes this limitation may be described in various ways; it may be said that it imposes "a special burden" on the States (Victoria v. The Commonwealth [8] ), that it is "directed against" the States (Victoria v. The Commonwealth [9] ), that it "single[s] out" the States or places "special burdens or disabilities" upon them (Victoria v. The Commonwealth [10] ) or that it is "a law aimed at [the] restriction or control" of the States (Victoria v. The Commonwealth [11] ). Similar statements of the law appear in The Commonwealth v. Tasmania ("the Tasmanian Dam Case") [12] .

[45]

As Dixon J. pointed out in Melbourne Corporation v. The Commonwealth [16] , the "content, context or subject-matter" of a legislative power may reveal an intention to authorize the Commonwealth to make a law aimed at the restriction or control of the State. It is unnecessary to consider which of the powers conferred by s. 51 might be exercised for that purpose. There is, however, nothing in the content, context or subject-matter of s. 51(xxxv) that provides any indication of such an intention. A line of decisions, of which the Engineers' Case [17] and the Professional Engineers' Case [18] are notable examples, shows that the power given to the Parliament by s. 51(xxxv) extends to the making of laws which bind the States as employers, but there is nothing in the words of par. (xxxv), or in the nature of the power which it confers, that suggests that it is intended that the Parliament should be entitled to make laws of the kind described in the paragraph but directed at a State and intended to place the State, as employer, in a position of disadvantage as compared with other employers. It is true that there were circumstances in the present case which apparently led the Parliament to consider that special action was necessary to resolve the dispute referred to in s. 6(1) of the Act. However, to leave it to the Parliament to decide that discrimination against a State is necessary to achieve the settlement of a particular industrial dispute would be to erode the whole principle established by the cases to which I have referred. The exception indicated by Dixon J. relates to the nature of the power or the provision conferring it and not to the circumstances of a particular case which might be thought to justify particular discriminatory treatment of a State. The limitation, although implied, is a part of the Constitution and it would be wrong to allow it to be nullified in any case in which the Parliament thought its operation to be inconvenient. Moreover, once it is seen that a law "singles out" a State for discriminatory treatment, the Court would not be justified in upholding the legislation on the ground that the interference with the State was of no great importance, except, possibly, in cases clearly de minimis. The integrity of a State could be destroyed as effectively by a succession of minor infringements as by one gross violation of the principle.

[97]

The prohibition against discrimination operates to strike down laws which apply to agencies of a State as well as to a State itself: see, e.g., Melbourne Corporation [65] . Although there has been no examination of what is meant by "agencies of a State" in this context, there is no reason for thinking that the expression is confined to authorities which represent the Crown in the sense that they are entitled to the shield of the Crown. The foundation for the implication is not the special character and privileges of the Crown in right of the States, but the constitutional conception of the Commonwealth and the States as constituent entities of the federal compact having a continuing existence reflected in a central government and separately organized State governments. To restrict the prohibition to a State and such of its agencies as represent the Crown in right of that State would significantly limit the protection given to the States which, as governments, are free to choose whether a function should be carried out by a department of government or by an authority brought into existence for that purpose. The object of the implied prohibition is to protect the State in the exercise of its functions from the operation of discriminatory laws whether the functions are discharged by the executive government or by an authority brought into existence by the State to carry out public functions even if the authority acts independently and is not subject to government direction and even if its assets and income are not property of the State. And it is significant that s. 48 of the Banking Act, held to be invalid in Melbourne Corporation, was directed not only to a State but also to an "authority of a State, including a local governing authority". Accordingly, it is of no moment whether the plaintiffs in the first action, other than the Queensland Electricity Commission, represent the Crown in right of the State of Queensland. It is enough that they are agencies of the State, brought into existence for a public purpose. And it is not in question that all the plaintiffs in the first action are "electricity authorities" within the meaning of s. 4(1)(d) of the Act, so that the Act applies to the dispute found to exist on 18 April and to any industrial dispute which could result in the making of an award that is binding on one or more of them and would establish the terms and conditions of employment of its or their employees.

[141]

I think the same conclusion must follow with respect to the dispute referred to in s. 6(1). Whilst there is always an element of fact and degree in determining whether a statute singles out a State for discriminatory treatment and that in the present case it is relevant to have regard to the not unreasonable concern of the Parliament to facilitate an early settlement of that part of the existing dispute which involves the electricity authorities of Queensland it remains the fact that the identity of those employers and their relationship to the State of Queensland was seen by the Parliament to be a central factor in the matrix of circumstances provoking its intervention. In my opinion, the Act in its entirety is aimed at agencies of the State of Queensland, singling them out for special treatment by the Commission in its approach to the settlement of the interstate dispute. That being the case, it does not avail the Commonwealth to argue that the interference by the Parliament is not particularly serious by reason of the fact that the Commission if left alone might well in the exercise of its discretion have adopted the same course as the Act obliges it to adopt. One cannot be certain of that. In terms, the Act denies to the Queensland employers courses of action which under the principal Act are secured to other employers who are parties to the dispute. In the words of Dixon J. in Melbourne Corporation [19] , which I have already cited, the Act attempts "to isolate the State from the general system, deny it the choice of the machinery the system provides and so place it under a particular disability". In such a case the magnitude of the disability, whether it is of great or of small importance to the State, is not a material matter for inquiry. It is enough that it interferes with the freedom of the agencies of a State to pursue that course in the conduct of their industrial relations which would be permitted by the general system of conciliation and arbitration provided by the principal Act.

[144]

A prohibition can be implied only from the terms of the Constitution itself, construed in the way prescribed in Amalgamated Society of Engineers v. Adelaide Steamship Co. Ltd. ("the Engineers' Case") [22] , i.e., "naturally in the light of the circumstances in which it was made, with knowledge of the combined fabric of the common law, and the statute law which preceded it ". The Constitution, though enacted to give effect to an agreement by the peoples of the Australian colonies to unite in a federal Commonwealth, is not a contract between the colonies or between the people of the colonies. Nor is it a contract between the Commonwealth and the States. No implication can be founded on what was called "a vague, individual conception of the spirit of the compact, which is not the result of interpreting any specific language": the Engineers' Case [23] . The Constitution, as Barwick C.J. pointed out in the Pay-roll Tax Case [24] , is a statute which at once created the Federation and distributed powers among the Commonwealth and the States. The Constitution summoned the Federation into existence and maintains it in being. Any implication affecting the specific powers granted by the Constitution must be drawn from the Constitution itself. It is impermissible to construe the terms of the Constitution by importing an implication from extrinsic sources when there is no federation save that created by the express terms of the Constitution itself. In particular there is no room for an implication derived from shadowy political constructs of a federation in which the specific powers granted to the Commonwealth are not permitted to encroach on the residue of powers available for exercise by the States. The principle, established in the Engineers' Case [25] , is that "where the affirmative terms of a stated power would justify an enactment, it rests upon those who rely on some limitation or restriction upon the power, to indicate it in the Constitution". In the Tasmanian Dam Case [26] , I adopted the formulation by Mason J. of the relevant implication (in Victoria v. Australian Building Construction Employees' and Builders Labourers' Federation [27] ):

[147]

The fact that certain private employers are given an exemption which is denied to the States does not necessarily mean that the statute discriminates against the States in the sense defined by Sir Owen Dixon. The question is, to some extent, one of degree. If the position of the States is compared with that of private employers generally, it is not possible to say that the States are under such a special burden or disability that the legislation is aimed at the restriction or control of the States. Although the independence of the States in the exercise of their powers is protected by the implication, discrimination in itself is not an universal touchstone of invalidity. In the Pay-roll Tax Case [2] , Barwick C.J. said that "the discriminating nature of a legislative provision will not itself be definitive of invalidity". And in Victoria v. The Commonwealth [3] , Williams J. said: Discrimination against a State, where it can be seen to be justified, is not a ground for invalidating a Commonwealth law which would otherwise be authorized by a legislative power conferred on the Commonwealth Parliament in my opinion [it] could not be contended, that discrimination in itself would be sufficient to invalidate such a law. (Emphasis added.) It would state the implication too widely to say simply that the Commonwealth is prohibited from making any discriminatory law which involves the placing on the States of special burdens or disabilities affecting the exercise of their powers. It is not consistent with the plenary nature of the powers of the Commonwealth to deny the validity of a discriminatory law enacted under a power which supports the discrimination. Thus the implication formulated by Mason J. in Victoria v. Australian Building Construction Employees' and Builders Labourers' Federation [4] contained the appropriate qualification on the prohibition against discriminatory laws: "unless the nature of a specific power otherwise indicates". Not every law is invalid which requires a State in the performance of its functions to bear a burden or suffer a disability to which others are not subject. 1. (1947) 74 C.L.R., at p. 83. 2. (1957) 99 C.L.R. 575, at p. 609. 3. (1971) 122 C.L.R., at p. 426. 4. (1971) 122 C.L.R., at p. 375. 5. (1957) 99 C.L.R., at p. 638. 6. (1982) 152 C.L.R. 25, at p. 93.

[150]

Just as when the Federal Government desires to use or take advantage of anything the nature or character of which is determined by an exercise of the exclusive power of the State, it must take it as it finds it, so the States, when they avail themselves of services or facilities regulated or determined by Federal law, must accept it as part of the system enjoyed by the whole community. Such things are a consequence of the distribution of powers and stand apart altogether from some exercise of legislative power which singles out the States or which operates specially to impede them in their functions. Section 48 of the Act of 1945 discriminated against States and in that way singled out the States in order to curtail their freedom in using the general banking system. What is prohibited is an adverse discriminatory operation of a law, not an adverse operation of a general law. And it is the discriminatory operation which needs to find support in a head of power. It is insufficient to show that a law imposing a discriminatory burden or disability on the States exhibits such a connexion with a subject of legislative power as to give it the character of a law with respect to that subject if the power does not authorize the particular discrimination which the law effects. Generally speaking, a legislative power does not support the imposition of a discriminatory burden or disability on the States intended to result and resulting from a law made with respect to the subject-matter of the power. Dixon J. explained the particular rule applicable to discriminatory laws in Melbourne Corporation [7] : Speaking generally, once it appears that a federal law has an actual and immediate operation within a field assigned to the Commonwealth as a subject of legislative power, that is enough. It will be held to fall within the power unless some further reason appears for excluding it. That it discloses another purpose and that the purpose lies outside the area of federal power are considerations which will not in such a case suffice to invalidate the law. In the United States much use has been made in this way of the postal power and of the commerce power to legislate in a way calculated to vindicate morality or achieve a social purpose rather than to advance the postal services or promote or regulate inter-state commerce as such. When this is done the result is that laws confined to an existing head of federal power nevertheless reach as a matter of purpose into fields lying under State legislative authority. But it is one thing to say that a federal law may be valid notwithstanding a purpose of achieving some result which lies directly within the undefined area of power reserved to the States. It is altogether another thing to apply the same doctrine to a use of federal power for a purpose of restricting or burdening the State in the exercise of its constitutional powers. The one involves no more than a distinction between the subject of a power and the policy which causes its exercise. The other brings into question the independence from federal control of the State in the discharge of its functions. 1. (1947) 74 C.L.R. 31. 2. (1948) 76 C.L.R. 1, at pp. 337-338. 3. (1947) 74 C.L.R., at pp. 79-80.

[152]

In Melbourne Corporation [8] the Court held that s. 48(1) of the Banking Act 1945 exhibited such a connexion with the banking power (s. 51(xiii)) as to give it the character of a law with respect to banking, but the banking power did not support the Banking Act's ulterior purpose and effect: the denial of banking facilities to the States and their authorities without the Treasurer's consent. The banking power did not authorize the imposition of such a discriminatory disability on the States. It may be that a prohibition against discriminatory laws is implied only when a law seeks to impose a discriminatory burden or disability on the States or on a State in consequence of a law directed to another entity, and that the validity of a discriminatory law directed to the States themselves depends not on an implication but on the proper characterization of the law. At all events, a law's direction to another entity may give it the character of a law with respect to a subject of legislative power although that power does not suffice to support the imposition of the discriminatory burden or disability on the States. In either case, the question is whether a head of legislative power supports the discriminatory imposition of a burden or disability on the States. The independence of the States in exercising their powers, implicit in s. 106 of the Constitution, and the binding effect of Commonwealth law upon them is thus reconciled: no inroad may be made on State independence in the exercise of their powers save what is necessary to give effect to a general Commonwealth law unless the power supporting the law supports the discriminatory imposition of a burden or disability on the States. As the implication arises from the independence of the States implicit in s. 106 of the Constitution, the prohibition applies in respect of each State. It would empty the implication of its content if a Commonwealth law could impose discriminatory burdens or disabilities on each of the States in turn although the Constitution prohibited a law imposing the same discriminatory burdens or disabilities on all States. Accordingly, I would hold that the discriminatory imposition of a burden or disability on a particular State is prohibited when the burden or disability affects the independence of that State in the exercise of its powers and no head of Commonwealth power supports a discriminatory imposition of such a burden or disability.

[166]

not for the special benefit of either or both of the disputing parties, but primarily, and by means of composing industrial differences, for the "peace, order and good government of the Commonwealth" - that is, for the whole people of the Commonwealth. It follows from this, that to apply to the solution of this matter, considerations which solely affect either or both of the parties, and to ignore the interests and welfare of the community in relation to the differences which imperil the continuance of the industry in which they are engaged, and therefore to ignore the interest which the community has, to have an industrial dispute settled, however suddenly it arises, and the sooner the better, is to mistake the fundamental nature of sub-sec. xxxv. The prescription of different procedures for the speedy settling of different disputes is wholly consistent with the promotion of the uninterrupted conduct of industrial activity throughout Australia. If the Parliament perceives that industrial peace is imperilled by delay in settling a particular interstate industrial dispute or a particular kind of interstate industrial dispute or a particular part of such a dispute, the prescription of a special procedure for speedy settlement of that dispute or of that kind of dispute or of that part of a dispute is wholly consistent with a valid exercise of the power. A law which prescribes a special procedure for speedy settlement of a dispute to which the employing authorities of the States or of a State are parties may be valid although the settlement procedures impose a burden or disability on the State employment authorities that is not imposed on other employers provided the burden or disability is imposed not by reference to the governmental character of the employing authorities but by reference to the character of the dispute to which they are parties. Of course, it is fallacious to regard an industrial dispute as completely divorced from the character of the parties to it but equally it is fallacious to assume that special settlement procedures applicable to a particular dispute or part of a dispute invalidly discriminate against a State merely because a discriminatory burden or disability is imposed on the State as an employer who is a party to the dispute. However, the conciliation and arbitration power does not support the prescribing of special settlement procedures involving the imposition on State employment authorities who are parties to a dispute of a burden or disability that is not imposed on other employers if there is nothing to distinguish the disputes to which the special settlement procedures apply save the fact that the State employment authorities are parties. The validity of the Act therefore depends on whether the disputes to which the Act applies are different from the general mass of disputes to which the general provisions of the Conciliation and Arbitration Act apply, whether the distinguishing features of the s. 6 disputes show that those disputes might reasonably be regarded as requiring speedy settlement and whether the special procedure applicable to those disputes might reasonably be regarded as the means of achieving that result. These are questions of fact and degree. 1. (1947) 74 C.L.R., at p. 81. 2. (1912) 15 C.L.R. 586, at pp. 609-610.

[171]

The first dispute to which the Act relates is an existing dispute (s. 6(1)). The Act contains no description of that dispute which serves to distinguish it as requiring speedy settlement, but the distinguishing feature may appear from the dispute itself. We are familiar with the nature of this dispute for the finding of its existence has been challenged in this Court: Reg. v. Ludeke; Ex parte Queensland Electricity Commission [17] . We may turn to the material in that case to ascertain the nature of the dispute mentioned in s. 6(1) of the Act. The finding upheld in that case shows that the dispute arose from the employers' rejection of a log of claims served by the E.T.U. on employers in the electricity industry in Queensland, Western Australia, South Australia, Victoria, Tasmania, the Northern Territory and the Australian Capital Territory, including the Snowy Mountains Hydro-Electric Authority. The log includes claims for award provisions which would protect employees from peremptory dismissal even for misconduct and which would entitle employees to a substantial period of notice of intention to dismiss. The log also claims a union preference clause. In these respects the present relationship between the electricity authorities of Queensland and their employees is governed by Queensland law - specifically, by Acts of the Queensland Parliament passed in 1985. These Acts, enacted in consequence of severe industrial disruption of the electricity industry in Queensland, provide, inter alia, that an employee who fails to comply with a direction to perform work issued by the Electricity Commissioner may be summarily dismissed and is liable to pay a pecuniary penalty (Electricity (Continuity of Supply) Act 1985 Q, ss. 3 and 4), that an employee engaging in a strike (defined to include, inter alia, a go slow strike, or the observance of bans or limitations (see Industrial Conciliation and Arbitration Act Amendment Act 1985 Q, s. 2) is liable to dismissal without notice or to suspension without pay (Electricity Authorities Industrial Causes Act 1985 Q, s. 27), that no union preference provision in an Act or award has any effect (Electricity Authorities Industrial Causes Act, s. 22) and that contracts of employment must contain a "no strike" clause (Electricity (Continuity of Supply) Act, s. 7(3)). The Queensland Acts excited much controversy. If the Commission were to hear and determine the dispute evidenced by the rejection of the log, the matters now governed by the controversial provisions of the Queensland Acts could be and probably would be canvassed in arbitration proceedings between the parties to the dispute. They could be settled by the terms of an award. If the Parliament took the view that a speedy settlement of the dispute involving these matters was desirable in the interests of "the whole people of the Commonwealth", the elimination by s. 8(1) of the Act of the question whether "further proceedings are not necessary or desirable in the public interest" from the preliminary issues to be considered by the Commission can reasonably be regarded as a means of achieving that result. The elimination of the question whether "the industrial dispute has been dealt with, is being dealt with or is proper to be dealt with by a State Industrial Authority of Queensland" is of little moment. The matters governed by the Queensland Acts could not be arbitrated by a State industrial authority.

[172]

The matters which are presently governed by the Queensland Acts and which are in issue in the dispute mentioned in s. 6(1) of the Act may reasonably be thought by the Parliament to have such a potential for interstate industrial disruption as to warrant the prescribing of a special procedure for speedy settlement of the interstate industrial dispute in which those issues fall for determination, especially as the Commission had recently given close and extensive consideration to the general provisions which it thought appropriate to safeguard security of employment: see Termination, Change and Redundancy Case [18] . There is nothing in s. 6(1) to suggest that it is the governmental character of the electricity authorities of Queensland rather than the nature of the dispute mentioned in that sub-section which is the criterion by reference to which the special settlement procedures are made applicable. One cannot infer that such discrimination as the Act effects with respect to this dispute is "aimed at the restriction or control of the State" or its authorities. An inference which can be drawn from the nature of the dispute is that the special settlement procedures are made applicable because of the exigencies of the dispute itself arising from the effect of the Queensland Acts on the issues in dispute. But that does not establish that the criterion of the discrimination is the character of the disputants. If the Parliament was entitled to regard the Queensland Acts as clothing some of the issues in the dispute with the potential to cause interstate industrial disruption - a view which it is not open to this Court to deny - the Act in so far as it prescribes appropriate speedy settlement procedures applicable to that dispute is within the conciliation and arbitration power. The circumstance that the employing authorities who are subject to the Queensland Acts are authorities of the State is not a statutory criterion of the application of the Act to the dispute mentioned in s. 6(1).

[183]

The content of the restriction was expressed by Dixon J. [28] in the form of three "reservations" upon the "prima-facie rule that a power to legislate with respect to a given subject enables the Parliament to make laws which, upon that subject, affect the operations of the States and their agencies". That "prima-facie rule" was described [29] as "the effect of the Engineers' Case stripped of embellishment and reduced to the form of a legal proposition". The "reservations" had been mentioned by his Honour in previous judgments: see Australian Railways Union v. Victorian Railways Commissioners [30] ; West v. Commissioner of Taxation (N.S.W.) [31] , and Essendon Corporation v. Criterion Theatres Ltd. [32] . As Dixon C.J. was subsequently to acknowledge (see the Professional Engineers' Case [33] ), they do not lie well with some of the broad statements of the majority judgment in the Engineers' Case: cf. Professor Sawer, "Implication and the Constitution", Res Judicatae, vol. 4 (1948), pp. 21-22. Two of them, that "relating to the prerogative" and that "relating to the taxation power", were not in point in Melbourne Corporation and have not been established by subsequent cases at least to the extent that they are separate from or would expand the third. It is that third reservation which was in point in Melbourne Corporation and which should, in my view, be accepted as established by the decision in that case. Dixon J.'s broad enunciation of it [34] must, as Walsh J. indicated in the Pay-roll Tax Case [35] , be understood in the context of his Honour's subsequent comments in the Bank Nationalization Case [36] . So understood, it comprises a restraint upon the exercise or use of power or authority. Its central operation is to preclude the exercise of Commonwealth legislative or executive powers "to control the States" or in a manner which would be inconsistent with the continued existence of the States as independent entities and their capacity to function as such. It is not suggested that that central operation of the reservation applies here. What is relevant to the present case is that the reservation also extends to preclude discriminatory treatment of the States in the sense of the use or exercise by the Commonwealth of such powers to single out the States to place upon them "special burdens or disabilities". In Victoria v. Australian Building Construction Employees' and Builders Labourers' Federation [37] , Mason J. formulated the third reservation in terms which reflect the judgments of Dixon J. in Melbourne Corporation and of Walsh J. in the Pay-roll Tax Case:

[187]

The fact that a general law imposes a particularly onerous burden upon the States (or upon a particular State) does not necessarily mean that the law relevantly discriminates against them (or it). To be caught by the reservation, the law must, as has been indicated above, discriminate in the sense that its operation involves a singling out of the States to make them "the objects of special burdens or disabilities": cf. Melbourne Corporation [41] . That is not to say that a law cannot discriminate against the States in the relevant sense if it is cast in general terms and is of apparently general application. Quite apart from the case where such a general law applies to the States in a way which would prevent them from performing their essential functions or which would impede them in so doing (cf. per Rich J., Melbourne Corporation [42] ; per Walsh J., the Pay-roll Tax Case [43] ), a general law may operate in the context of particular circumstances to single out the States for discriminatory treatment. The character of a law as a law of general application is ordinarily a factor, and sometimes a conclusive factor, militating against the conclusion that it discriminates against the States or a State in the relevant sense. The question whether a law does so discriminate against the States or a particular State is however, for the purposes of the law of the Constitution, a question of substance which is not susceptible of being resolved by the mere inquiry whether, as a matter of form, the law is a general or a special one. The point may be conveniently illustrated by reference to the Pay-roll Tax Case. The decision in that case was that Commonwealth legislation imposing a general pay-roll tax to be paid by employers on wages paid to their employees validly applied to the States and their agencies. The fact that the States' pay-rolls were particularly large no doubt meant that the effect of the legislation was particularly onerous in its application to them in the sense that they paid more tax than all or most other employers. That did not, however, mean that the legislation was discriminatory against the States in the sense that it singled them out to be made objects of special burdens or disabilities. On the other hand, if the legislation had been confined to the imposition upon all employers other than the Crown in right of the Commonwealth of liability to pay-roll tax upon wages paid to "public servants", it might still properly have been seen, as a matter of form, as a law of general application. Such confined legislation would, nonetheless, have discriminated against the States in the relevant sense for the reason that, as a matter of substance, its operation would have been, in circumstances where the States and State instrumentalities were the only non-Commonwealth employers of "public servants", to single out the States for the imposition of a special burden.

[192]

The decision in Melbourne Corporation [46] establishes that the characterization of a law as a law with respect to a subject- matter of Commonwealth legislative power will not, of itself, remove it from the reach of the overriding restriction precluding the use or exercise by the Commonwealth of its legislative powers to single out the States or their instrumentalities to place upon them special burdens or disabilities. That overriding restraint will be defeated only in the exceptional case where the relevant legislative power appears, "from its content, context or subject-matter", to be intended to authorize the discriminatory operation of the particular law: cf. per Dixon J., Melbourne Corporation [47] . Put differently, the singling out of the States for the imposition of some special burden or disability must itself have such a real and close connexion with the subject-matter of legislative power as to warrant the positive conclusion that the grant of legislative power was intended to authorize such discrimination against the States in the context of such a law. An example of such an exceptional case is where the nature of the subject-matter of legislative power is such that the discriminatory operation of a law may do no more than reflect a necessary ingredient of what gives the law its character. Thus, to take the most obvious illustration, a law providing for the acquisition of property on just terms from a particular State (Constitution, s. 51(xxxi)) will discriminate against that State if the acquisition is against its will. Another example of such a case is where a particular exercise of the relevant legislative power necessarily involves distinctions between different geographical areas: defence (s. 51(vi)), quarantine (s. 51(ix)) and medical services such as immunization (s. 51(xxiiia)) may provide illustrations. Yet another example of such a case is where the relevant legislative power authorizes the singling out of a particular identified object, activity or situation for special legislative treatment and a State or State agency is affected by reason of its relationship with that object or involvement in that activity or situation. It is argued, on behalf of the Commonwealth, that the present case falls within this category.

[194]

The legislative power of the Parliament (s. 51(xxxv)) with respect to conciliation and arbitration for the prevention and settlement of interstate industrial disputes "necessarily and by reason of the subject-matter" extends "to all parties, States as well as persons, engaged in industrial disputes extending beyond the limits of any one State": per Starke J., R. v. Commonwealth Court of Conciliation and Arbitration; Ex parte Victoria [48] . It is not, in my view, confined to the enactment of legislation establishing conciliation and arbitration procedures for the prevention or settlement of disputes generally. It extends to authorize legislation making specific provision for conciliation and arbitration for the settlement of a particular identified interstate industrial dispute. In such a case, the legislative power obviously encompasses the enactment of some provisions which discriminate against parties to the particular dispute by, e.g., subjecting them to compulsory conciliation or arbitration proceedings. If the parties to the relevant dispute include a State or State instrumentality, the legislative power will be seen as necessarily intended to authorize such discriminatory treatment of it in its character as a party to the relevant industrial dispute. Moreover, the particular circumstances of the involvement of a State or State instrumentality in a particular industrial dispute might be such that the power to legislate with respect to conciliation and arbitration for the settlement of that dispute might arguably be seen to authorize discriminatory treatment of it vis-à-vis the other parties to the dispute. Such a singling out of a State or a State instrumentality for discriminatory treatment would, however, only be within the intended scope of the legislative power with respect to conciliation and arbitration if it can be seen to be justified as an integral part of a coherent legislative provision with respect to conciliation and arbitration for the prevention or settlement of the particular dispute.

[196]

The electricity authorities of Queensland to which the Act refers ("the electricity authorities") are the agencies through which the State of Queensland discharges its traditional governmental function of supplying electricity to its residents. They are properly to be seen, for the purposes of the reservation, as agencies of that State. An analysis of the provisions of the Act discloses that, as a matter of substance, the Act has a discriminatory operation at three distinct levels in relation to those agencies. At one level, it applies the special regime to the particular dispute identified in s. 6(1) and thereby subjects the parties to that dispute, including the electricity authorities, to any disadvantage or disability involved in the special regime. At the second level, it confines the s. 6(2) class of dispute (as distinct from the particular s. 6(1) dispute) to disputes which could result in the making of an award that would be binding on, and would establish terms or conditions of employment of employees of, such an authority. At the third level, the Act discriminates against those electricity authorities in relation to the operation of certain of the provisions which constitute that special regime. In particular, s. 8(1) prevents the Commission, "in so far as the industrial dispute exists between an organization of employees and one or more electricity authorities of Queensland", from dismissing a matter or part of a matter or refraining from further hearing or from determining the industrial dispute notwithstanding that it appears to the Commission that the industrial dispute has been, is being, or is proper to be, dealt with by a State industrial authority of Queensland or that further proceedings are not necessary or desirable in the public interest. Section 9(6) has the effect that the requirement that a Full Bench of the Commission itself deals with an industrial dispute to which the Act applies is, if the hearing of the dispute is split, confined only to the part of the industrial dispute that involves an electricity authority. The critical question is whether the discriminatory treatment of the electricity authorities under the Act can properly be seen as authorized by s. 51(xxxv) of the Constitution.

[198]

Section 6(1) of the Act stands in contrast to s. 6(2). It applies the provisions of the Act to a particular identified interstate industrial dispute: see Reg. v. Ludeke; Ex parte Queensland Electricity Commission [49] . Of itself, s. 6(1) makes no distinction between the parties to the dispute. The electricity authorities are not affected by s. 6(1) by reason of their being singled out for the imposition of special burdens or disabilities. They are affected by s. 6(1) by reason of the fact that they are parties to the particular industrial dispute to which the legislation applies. The same comment can be made of the provision of s. 7 of the Act requiring the Commission to endeavour to settle the dispute as expeditiously as is appropriate. It affects the parties to the dispute only by reason of their involvement in it. In my view, any discriminatory treatment of the parties to the dispute, including the electricity authorities, which is involved in the provisions of ss. 6(1) and 7 of the Act is a necessary ingredient of a coherent legislative provision with respect to conciliation and arbitration for the prevention or settlement of the particular interstate industrial dispute and itself comes within the scope of the grant of legislative power contained in s. 51(xxxv). In contrast, ss. 8 and 9 relevantly discriminate against the electricity authorities vis-à-vis any other parties to the dispute. Those two sections do that by singling out, for restrictive treatment, the dispute or a part of the dispute by reference to whether an electricity authority remains or is a party to it. That discrimination is superimposed upon any discriminatory treatment of the parties to the dispute by reason of their character as such. It cannot, in my view, properly be seen, on the material before the Court, as itself coming within the intended scope of s. 51(xxxv). Consequently, it is struck down by the relevant reservation upon the use or exercise of Commonwealth legislative powers. That discriminatory treatment of the electricity authorities is central to the operation of ss. 8 and 9 and the effect of its invalidity is that both those sections are wholly invalid.