Radio Corporation Pty Ltd v Commonwealth [1938] HCA 9

Radio Corporation Pty Ltd v Commonwealth [1938] HCA 9 - HCA 1938 case summary — Zoe

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Wilbur Ham K.C. Five essential parts of radio sets are pro- hibited because they come from America. The plaintiff requires these goods, and the Ministry had no power under the Customs Act to prohibit their importation. Sec. 52 (g) of the Customs Act 1901- 1935 merely enables the Governor in Council to add to the list in secs. 51 and 52 of goods which the legislature says are prohibited. Sec. 56 can only operate as incidental to the power in sec. 52 (9), so that the power under sec. 52 (g) can be exercised either abso- lutely or subject to a condition. The items are too vaguely set out in the regulations. The diversion of trade or the encourage- ment of local industries is not proper to be carried out by regulations. Baxter v. Ah Way (1) shows the grounds on which sec. 52 (g) of the Customs Act was upheld. Sec. 52 (g) could not support these regulations, and, if it could, sec. 52 would then have to be construed as a limiting and not as an extending power. Sec. 52 (g) requires the goods to be specified in the regulation itself. Sec. 52 (g) and see. 56 must be read together. There is no legislative authority for this regulation (Swan Hill Corporation v. Bradbury (2) ; Melbourne Corporation v. Barry (3) ). Under reg. 4 of 1934 it would be possible to prohibit the importation of everything into the country. It is not sufficient to say that the regulations will be administered in such a way as to admit certain articles; the real purpose of the regulations must be considered. The goods them- selves must be specified in the regulations in such a way as to enable traders to identify the goods by reference only to the regulations and to the goods. Any conditions imposed must be equally certain. In any case the matter cannot be left to the discretion of the Minister. The penal provisions against importing prohibited goods make it clear how necessary certainty is. The proper authority to exercise the discretion is the Governor in Council and not the Minister. A power of the magnitude contended for is not likely to have been granted at all, and if it were it should be construed within narrow limits (Attorney-General vy. Brown (4) ). Under sec. 52 (g)

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legislative power so delegated includes the power to set up any factum which Parliament might have set up as the condition of admission, including the discretion of a third party, or the origin, destination or intended use of the goods. There is no uncertainty about the condition imposed by reg. 4. It is the regulation coupled with secs. 50 and 56 that legally controls the importation of goods, and not the action of the Minister. Given a regulation which sets up as a factum the consent of the Minister, the proper or improper granting or withholding of his consent is irrelevant in determining the validity of the regulation. If the method of the exercise of the Minister's discretion shows anything, it is the motive or policy actuating the making of the regulation. Motive or policy actuating the making of the regulation must be distinguished from the regula- tion's operative effect. A regulation made under the power will not be vitiated by the policy that led the Governor-General in ' Council to exercise the power. Its validity will depend upon whether or not the immediate operative effect falls within the scope of the power. In any event, there are the following procedural objections even if the plaintiffs are right : - (a) There is no right to an injunction against the Commonwealth. (6) There is no right to damages or an injunction against any of the defendants merely on the ground of the regulations being bad, and insisted on as a matter of adminis- tration, in the absence of any allegation of tortious interference with property. (c) No right of action is shown against the Comp- troller-General in that it is not alleged that the notice required by sec. 221 of the Customs Act was given. [Counsel referred to Lyons v. Smart (1); Whitfield v. Ohio (2); J. W. Hampton Jr. & Co. v. United States (3); Roche vy. Kronheimer (4); Huddart Parker Ltd. v. The Commonwealth (5); Victorian Stevedoring and General Con- tracting Co. Pty. Ltd. and Meakes vy. Dignan (6); Dignan v. Australian Steamships Pty. Ltd. (7); Attorney-General for New South Wales v. Brewery Employees' Union of New South Wales (8).

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The Act is also, however, a law with respect to trade and com- merce with other countries. It is argued that, if the Act is so regarded, regulations made under it are invalid if they permit the introduction into the question of determining what are prohibited imports considerations which are extraneous to such trade and commerce (Of. Victorian Railways Commissioners v. McCartney and Nicholson (3)). But the object of customs legislation, includ- ing the Customs Act, is to obtain revenue and to control trade

both import trade and export trade. The import trade is con- trolled by such provisions as sec. 30 of the Customs Act, which provides that all imported goods shall be subject to the control of the customs from the time of importation until the time of home consumption or exportation to parts beyond the seas. The import trade is further controlled by the imposition of duties and of prohibitions imposed either directly by statute or by regulations made under statutory powers. The duties which are to be found in the customs tariff are conditioned by such matters as the country of origin of goods. The operation of the whole tariff, with its division into British preferential and general tariff, depends upon the country of origin of the goods imported. (See also R. v. Barger (4).) Further, the tariff contains many provisions distinguishing between goods, not merely according to their quality or intrinsic characteristics, but according to the purposes for which they are to be used. Again, the tariff in many of its items refers to departmental by-laws (that is, departmental decisions representing the opinion of the Minister administering the department) as the criterion which may determine the rate of duty applicable. In other cases the fact that goods are owned by a particular individual or imported for his use (for example, for the use of a State Governor or trade commissioner or consul) is adopted as a relevant discrimen. Further, articles imported for the use of certain institutions such as universities and other educa- tional institutions may be admitted free, while the same goods

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therefor rectifying valves " carbon blocks" and " Electric insulating paper and boards." As will be seen, these are descriptions of goods depending either upon their nature or upon that and the use for which they are adapted. No doubt the descriptions are wide, but they are capable of what we may call objective ascertainment upon inspection of the goods. But the catalogue is preceded by a limitation which depends, not on the nature of the goods, but upon the place where they were pro- duced or manufactured: "The undermentioned goods produced or manufactured in any country not being," stated briefly, under the King's sovereignty, suzerainty, protection, or mandate, or under the mandate of a British Dominion. No narrow or restrictive interpretation of the power which these regulations confer upon the Minister will suffice to sustain the course which he has taken under them. For, according to the allegations which must be taken as correct for the purposes of the demurrer, the Minister has exercised a full discretion to let in or keep out particular consignments to particular importers ; he has been guided by the purpose of diverting trade in accordance with government policy, and subject thereto he has paid regard to the needs of the particular trader and to the local and other sources whence they may be supplied. But, in any case, except on artificial grounds for the purpose of saving the validity of the regulations, we do not think that a restrictive inter- pretation could be placed upon the Minister's discretionary power of consenting to importation. The regulation is so expressed as to leave him with a complete discretion, and it does not define the purpose or grounds of its exercise. It is plain from the length and nature of the catalogue contained in the second schedule that the object of the regulations was to invest the Minister with a power of administrative control over the importation from foreign countries of large classes of goods and to enable him to exercise that control by the allowance or disallowance of applications for his written consent in respect of specific shipments or consignments.

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Can anyone believe that in 1901 the Parliament intended to transfer or delegate to the Executive such a large measure of its authority to regulate foreign trade with this country? We have since that time undergone experiences as well as changes of constitutional practice which may make such a delegation appear less remarkable than it would to those responsible for the enactment. This consideration ought not to lead us to restrict the operation of the provision, if the fair meaning of its language extends far enough to include the use which has been made of the power it gives. But, on the other hand, it would be a mistake to read into indefinite or ambiguous expressions a meaning which they would not possess for those unfamiliar with exigencies that have been felt only as the result of later conditions. We have the advantage of opinions given in 1909 by members of this court as to the scope of the provision conferring upon the Executive power to proclaim goods as prohibited imports. In Baater v. Ah Way (1) the validity of the provision was attacked unsuccessfully on the ground that it amounted to a delegation of legislative power, and in support ot the attack it was said that the Executive might under the power go to any lengths in forbidding the importation of goods. To this Griffith C.J. said in the course of the argument : - " You admit that a law may be conditional on the ascer- tainment of some fact, and that some authority may be appointed to decide the question of fact . . . Does not the section merely prohibit the importation of such goods as the Governor-General in Council thinks it expedient to exclude ?" (2). Isaacs J.added: " Donot the rest of the sub-sections indicate the kind of goods to be prohibited, i.e., goods injurious to the community, leaving it to the Executive to bring within the prohibition any goods which may in the future turn out to be injurious" ? (2). In his judgment O'Connor J. said that the section specified a number of imports which it declared were pro- hibited. " But in that list it leaves a blank to be filled up by pro- clamation of the Governor-General in Council, to be filled up as the Governor-General and the Executive Council may think fit in any contingency that may hereafter arise" (3). A little afterwards he says: "The whole of the law, therefore, which operates in the case

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Judgment (126 paragraphs)