R v Regos and Morgan [1947] HCA 19

R v Regos and Morgan [1947] HCA 19 - HCA 1947 case summary — Zoe

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provides that for the purposes of the Act ' black marketing ' includes any act or thing done, or omitted to be done, or any conduct, 'in contravention of the regulations,' which is declared by regulations made under the Act to be black marketing. The expression ' the Regulations,' which occurs in the foregoing phrase ' in contravention of the Regulations,' is defined, but the definition is affected by the Defence (Transitional Provisions) Act 1946. The expression now means any regulations in force by virtue of the Defence (Transitional Provisions) Act and includes any orders in force by virtue of that Act or made under any such regulations. The Black Marketing Regulations (Statutory Rules 1945 No. 114) contain the declaration upon which reliance is placed to make it black marketing to fail to keep proper books and accounts. That regulation says: 'It is hereby declared to be black marketing for any person, in contra- vention of reg. 49 of the National Security (Prices) Regulations, to omit to do any act which the person is required by that regulation to do or to fail to comply with any direction given under that regulation." This Black Marketing regulation is made under s. 17 (a), which empowers the Governor-General in Council to make regulations declaring any act or thing done or omitted to be done, or any conduct: in contravention of ' the Regulations,' to be black marketing. Sub- regulation (1) of reg. 49 of the National Security (Prices) Regulations, which is invoked by the Black Marketing regulation, requires that any person who carries on a business such as that of the accused Morgan shall for the purposes of the Prices Regulations keep proper books and accounts, and stock and costing records where applicable, and shall preserve the same, together with a category of supporting documents which are set out. On the part of the prosecution it is proposed to adduce evidence for the purpose of showing a practice of making in the books that were kept entries not conforming

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with the facts and in particular understating amounts received. In this way an attempt is to be made to show that the books and accounts kept were not proper books and accounts, with the consequence that there was an omission to keep proper books and accounts. In the second place, evidence is to be offered, and some has already come in, designed to prove that proper stock records were not kept, though stock records were applicable. Three objections have now been raised on behalf of the accused. First, it is said that the attempt by the Black Marketing regulation to transform a failure to comply with Prices reg. 49 into black marketing isineffective. It is contended that the very generality of the material words of s. 3 and of s. 17 (a) of the Black Marketing Act shows that they must be restrictively interpreted. For example, it is hardly possible that an offence of black marketing could be obtained from the National Security (Aliens Control) Regulations, the Capital Issues Regulations, the Economic Organisation Regulations, the Industrial Peace Regulations, the Shipping Co-ordination Regulations or the Prisoners of War Regulations, to mention only a few, and yet these are all within the literal meaning of the words used. Accordingly, it is contended first that the material words of s. 3 and s. 17 (a) of the Black Marketing Act must be read ejusdem generis with the list of offences 'set out in pars. (a) to (7) of s. 3. It is then said that, if their meaning and application are so restrained, the words will not cover the keeping of books, accounts and records. To the first of these two propositions I am inclined to give a general assent. But I do not think that the second of them is a proper consequence of the first. I think that the subject with which the list of offences stated in pars. (a) to (i) deals may be shortly described as the supply or disposal of goods and services, the acquisition or receipt of the former and the receipt or use of the latter and the use of ration tickets and the like and their genuineness. But the list covers also much that is incidental to this subject. The purpose of the general words that follow seems to me to authorize the addition of things dealt with in the National Security Regulations which arise out of, are incidental to or consequential upon, the subjects of the specific offences listed or are conducive to their suppression. So interpreted, I think s. 3 and s. 17 (a) authorize the Black Marketing

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for the accused. The Act to be considered in this case is entitled "An Act to provide for the Prevention of Black Marketing," and the method it adopts is the imposition of very heavy penalties for breaches of laws already in existence. It may therefore be supposed that it is concerned to prevent " marketing" which is contrary to law, that it has relation to the sale and purchase of commodities (and of services, which, in effect, are treated as commodities), and that it does not intend to include in the description " black market- "ing" anything which, in the ordinary meaning of the word, would not be called " marketing." For what it actually covers one must look to the definition of " black marketing" in s. 3 of the Act. It deals with contraventions of " the Regulations," that is, regulations (as now in force) which were originally made under the National Security Act ; in pars. (a) to (2) it specifies a large number of such con- traventions as constituting " black marketing " and concludes with the statement that the expression " includes any other act or thing done, or omitted to be done, or any conduct, in contravention of the Regulations, which is declared, by regulations made under this Act, to be black marketing." Corresponding words in s. 17 confer on the Governor-General the power to make the declaratory regulations. Apart from the concluding words of s. 3 and the corresponding words of s. 17 (which, presumably, have the same meaning), there is nothing in the Act to suggest that it is to operate on anything which could not be described as " marketing": on the other hand, there are positive indications in the Act that it should be thus limited. Admit- tedly, if those words are given the full literal meaning of which they are capable, if they are not in any way limited by their context, they will extend to any breach of National Security Regulations, however remote it may be from marketing or trading. For positive indica- tions to the contrary, the specific paragraphs of s. 3 are mainly relied upon, but there are also the provisions of s. 4 (6)-(8) relating to forfeiture of goods on conviction, the reference in s. 11 to " trading operations " and the provision in s. 12 for a notice of conviction to be displayed at the convicted person's place of business. It is, of course, not suggested that s. 12, for instance, has the effect that a person who has not a shop or other " place of business " cannot be convicted of the offence of black marketing; it is, nevertheless, a pointed indication of the type of case which the Act contemplates. It suggests that the persons at whom the Act is aimed are those engaged in "trading," the activities those of " marketing." Para- graphs (a) to (9) of s. 3 cover a great variety of matters, all of which are directly related to marketing, and, in the main, to nothing but

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marketing. Perhaps pars. (e) and (g) are literally capable of a wider meaning, but they must be read in their context. Paragraphs (h) and (7), although they do not deal with the actual disposal of goods, have a direct and intimate relation to that subject; the rationing documents, and the like, with which they deal are immediately, and not merely incidentally, connected with the control of marketing. The submission is, first, that pars. (a) to (7) within themselves, afford a context which enables one to say that they constitute a category of matters all of which are directly connected with marketing. It is a reasonable assumption that the draftsman set out in the specific paragraphs of s. 3 all the marketing offences which were present to his mind and then added the concluding words as a " drag-net " to cover other similar things which had not been thought of. That is a well-known method of drafting, and, whether the submission is regarded as simply asking that that method be accepted as having been used here, or is treated as invoking the ejusdem-generis rule of construction or the maxim noscitur a sociis, the submission is that the concluding words of s. 3 must be limited by relation to their context. If it is a question of the ejusdem-generis rule, the genus is constituted by pars. (a) to (7) of s. 3. Dixon J. accepted the argument for the accused to the extent that he was of opinion that the general words of s. 3 should be limited by relation to a category, but the category he adopted may be briefly described as marketing and matters incidental thereto, and he was of opinion that the keeping of books as required by reg. 49 of the Prices Regulations was within the category as an incidental. It is not disputed that the keeping of books has a relation to marketing. It is, however, only an indirect and incidental relation, whereas the matters in pars. (a) to (i) of s. 3 have a direct relation ; incidentals are not within the same category. So far as the authorities on the ejusdem-generis rule go, it does not appear that incidentals have ever been regarded as within the genus.

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P. D. Phillips K.C. No valid reason has been advanced for the imposition of any implied limitation on the words of s. 3. The structure of the section is not such as to invite the application of the ejusdem-generis rule. It is important to observe that the lettered paragraphs of s. 3 are not a catalogue of offences created by the Act. If they were, the comment could be made that it was unnecessary to specify those particular offences if the ensuing general words were designed to cover those offences and also others of a different character ; the specification would be surplusage unless the added general words were read down by relation to a genus to be found in the paragraphs. In s. 3 as it stands, however, Parliament says in effect : " We specify offences which we now know need to be dis- couraged by the imposition of severe penalties ; we do so to make it clear that we intend them to be covered ; but it may well be that, for reasons which we cannot now foresee, other contraventions of National Security Regulations will in the future assume a similar gravity ; we will therefore give the Executive a selective and dis- cretionary power to put any such offences on the same footing as those we have specified." This means that there was a logical reason for the particular specification by Parliament (and, therefore, it was not surplusage) and there was a logical reason for giving the Executive a wider area of choice. There is no reason to think that Parliament could not have intended to arm the Executive with such wide powers ; the known circumstances point the other way. It seems more extraordinary to suppose that Parliament intended to present the Executive with such a difficult task as that of ascertaining its powers by reference to the ejusdem-generis rule. The intention was to strengthen the hand of the Executive in war-time. No doubt, as a mere matter of words, it is odd to deseribe as " black marketing " something which has none of the characteristics of marketing, but the colloquial uses of the expres- sion are just as odd; moreover, this is not to the point if, as is submitted, the intention is clear. Further, the words " any other actorthing . . . orany conduct" are certainly not the charac- teristic words to which the ejusdem-generis rule has normally been applied. They do not suggest an intention to restrict the power of the Executive. On the contrary, they tend against the selection

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contention is that the words " any other act or thing done, or omitted to be done, or any conduct, in contravention of the Regulations " should not be literally interpreted but should be construed as related only to things of the same kind as are enumerated in the list of specific offences. In other words, it was argued that the general words should be construed as applying ejusdem generis with the particular instances which precede them. If so construed the accused say that the power would not cover the omission to keep books and accounts. Proceeding on the contrary assumption the Governor-General by reg. 3 of the Black Marketing Regulations declared it to be black marketing to do or omit to do any act in contravention of reg. 49 of the National Security (Prices) Regulations. The eighth count of the indictment was laid under these provisions. The learned judge, although disposed to think that a restrictive construction of the relevant words in s. 3 might be adopted, decided that a restriction could not be placed upon them narrow enough to exclude what was done by reg. 3 of the Black Marketing Regulations. His Honour accordingly allowed the count to stand and in the event both accused were convicted. The argument for a narrow interpretation of the power begins by calling attention to the extravagance of the sup- position that it was intended that any contravention of any regulation contained in the two stout volumes the sight of which has become so familiar to the Court might be converted into black marketing and so became punishable under the drastic penal clauses of that statute. From this beginning the argument proceeds to an examination of the specific offences defined by pars. (2) to (i) of s. 3. The ingenuity of counsel was employed in extracting from the elements of these offences some logical category which by a judicious use of the ejusdem- generis rule would exclude an offence of improper bookkeeping and accounting. Having listened carefully to the argument I am clearly of opinion that it cannot be done. The rule invoked is nothing but a guide of construction, and nothing could be clearer than that the intention of the legislature was to enable the Executive to amplify the list of black-marketing offences as experience and judgment might dictate. No doubt it is true that no one contemplated the use of the power to cover the whole field of National Security by regu- lation, but it is apparent that the draftsman felt unsure about the sufficiency of his list and trusted to the wisdom and discretion of the Executive to add to it when necessary. A reason for feeling unsure on such a subject is to be found in the extraordinary ingenuity and resource of those who seek to defeat or evade a control relating to rationing of goods or the repression of a rise in price in goods or services. Primarily one might conjecture that the power was directed

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Court

Decision date

Before

Source

Judgment (71 paragraphs)

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