Andrews v Howell [1941] HCA 20; (1941) 65 CLR 255 (3 July 1941)

HIGH COURT OF AUSTRALIA

Andrews Defendant, Appellant; and Howell Informant, Respondent.

H C of A

On appeal from a Court of Petty Sessions of Victoria.

3 July 1941

Rich A.C.J., Starke, Dixon and McTiernan JJ.

Sholl, for the appellant.

Ham K.C. and T. W. Smith, for the respondent.

Sholl, in reply.

The following written judgments were delivered:—

July 3

Rich A.C.J.

Appeal, by order nisi to review, from a summary conviction under the National Security Act 1939-1940.

The appellant was convicted under the National Security (Apple and Pear Acquisition) Regulations of an offence consisting in moving twenty-seven cases of apples acquired by the Commonwealth, which were held in his possession. He is an orchardist who grows apples somewhere near Melbourne, and he was shown to have taken twenty-seven cases of apples from his orchard to a Melbourne market. There is no dispute about the facts, but he says that it is beyond the power of the Commonwealth to make it an offence to move apples and pears from one place to another. The regulations in question were made under sec. 5 (1) of the National Security Act 1939, and their purpose is to establish a means of disposing of apples and pears within Australia as a remedy for the disorganization in marketing apples and pears caused by the want of shipping for the purpose in war-time.

Mr. Sholl, in a clear and careful argument, made four points against the validity of the regulations, any one of which, if right, would be enough to destroy the relevant provision.

I do not think that the regulations should be construed with complete literalness. The movement prohibited is transport from one store or locality to another. In my opinion this objection fails.

For these reasons I think the order nisi should be discharged and the appeal dismissed with costs.

Starke J.

The appellant was charged before a police magistrate in the Court of Petty Sessions at Melbourne for "that he did move twenty-seven cases of apples acquired by the Commonwealth which were held in his possession," contrary to the National Security Act 1939-1940 and the National Security (Apple and Pear Acquisition) Regulations 1939 No. 148, reg. 15, as amended by Statutory Rules 1940 No. 38 and Statutory Rules 1940 No. 276.

So far as material, the regulation provides: "Except as provided by these regulations or with the consent of the board, no person shall part with the possession of or move any apples or pears acquired by the Commonwealth which are held in his possession." The appellant was convicted and now appeals to this court by means of an order to review (Appellate Rules, sec. IV). He contends that the regulations and an order made pursuant to those regulations are beyond the powers given by the National Security Act 1939-1940, or are contrary to the provisions of sec. 92 of the Constitution.

The National Security Act provides that "the Governor-General may make regulations for securing the public safety and the defence of the Commonwealth and the Territories of the Commonwealth, and in particular" (inter alia) "(b) for authorizing ... (ii.) the acquisition, on behalf of the Commonwealth, of any property other than land ... and for prescribing all matters which, by this Act, are required or permitted to be prescribed, or which are necessary or convenient to be prescribed, for the more effectual prosecution of any war in which His Majesty is or may be engaged or for carrying out or giving effect to this Act." Under this Act the National Security (Apple and Pear Acquisition) Regulations in question in this case purport to have been made. "The purpose of these regulations is to minimize the disorganization in the marketing of apples and pears likely to result from the impracticability of exporting sufficient quantities of apples and pears because of the effects upon shipping of the present war and these Regulations shall be administered accordingly" (Statutory Rules 1939 No. 148, clause 2). An Australian Apple and Pear Marketing Board is set up which is a body corporate and consists of a chairman, deputy chairman, an executive member, and six other members representing respectively each of the six States, appointed by the Minister. A committee is also appointed by the Minister for each State (Statutory Rules 1939 No. 148 and 1940 No. 276). Any person who grows any apples or pears may, and every grower is required to, register as a grower. And "grower means the owner, lessee, or occupier of an orchard of which not less than one acre is wholly or principally used for the growing of apples or pears or of apples and pears." "The Minister may, from time to time, by order published in the Gazette, make provision for the acquisition by the Commonwealth of any apples and pears described in the order, whether by reference to any contingency or otherwise, and those apples and pears shall by force of and in accordance with the provisions of the order become the absolute property of the Commonwealth, freed from all mortgages, charges, liens, pledges, interests, and trusts affecting those apples and pears, and the rights and interests of every person in those apples and pears (including any rights or interests arising in respect of any moneys advanced in respect of those apples and pears) are hereby converted into claims for compensation" (Statutory Rules 1939 No. 148, 1940 No. 295). "Any person having in his possession, control or disposal any apples or pears acquired by the Commonwealth shall, on receipt of a notice in writing from the board ... requiring him to deliver or consign those apples or pears to an agent, packing shed, cool store or any other person or place specified in the notice, deliver or consign, as the case may be, those apples or pears to the agent, packing shed, cool store or other person or place within the time and in the manner specified in the notice" (1940 No. 276). "Upon delivery or consignment of any apples or pears in accordance with" the preceding provision, "or upon any apples or pears being disposed of or dealt with in accordance with instructions from the board, every person having any right or interest in those apples or pears may forward to the board a claim for compensation ... and shall be entitled to be paid such amount of compensation as the Minister, on the recommendation of the board, determines. It shall not be necessary for the Minister to make a determination ... until, in his opinion, a sufficient quantity of any apples or pears acquired by the Commonwealth has been disposed of to enable the board to make a just recommendation" (Statutory Rules 1939 No. 148). The board may, on behalf of the Commonwealth and subject to the direction of the Minister, sell or dispose of any apples or pears acquired or purchased by the Commonwealth, manage and control the handling, storage, protection, and shipment of any apples or pears acquired by the Commonwealth. The State committees have such powers as the regulations confer, or as the board thinks fit, but exercise all those powers subject to any direction which the board may give. The board is required to open a bank account into which it shall pay all moneys received by it in respect of apples and pears and also all moneys appropriated by Parliament or borrowed by the Minister for the use of the board on behalf of the Commonwealth. Out of the moneys standing to the credit of this account the board shall defray expenses and make all payments in respect of compensation and any other payments authorized by the regulations (Statutory Rules 1939 No. 148).

On 24th December 1940 the Minister made an order, which came into operation on 1st January 1941, as follows:—"3. (1.) All apples and pears grown by a person who is a registered grower or a grower within the meaning of the National Security (Apple and Pear Acquisition) Regulations and harvested on or after the 1st day of July 1940 and before the 1st day of July 1941—(a) if harvested on or before the date on which this order came into operation—are hereby acquired by the Commonwealth; and (b) if harvested after that date—shall, upon being harvested, be acquired by the Commonwealth. (2.) Nothing in the last preceding sub-paragraph shall apply to apples and pears which, having been harvested before the 1st day of January 1941, (a) are sold by retail before the 7th day of January 1941; or (b) are on the 5th day of January 1941, held in any retail fruit shop, fruit stall, or fruit barrow for sale by retail. (3.) All apples or pears grown by any such person in respect of which notice is given to him, either personally or by post, by or on behalf of the Australian Apple and Pear Marketing Board that the apples or pears are suitable for harvesting, shall, on the giving of such notice, be acquired by the Commonwealth. (4.) All apples and pears which are brought into Australia on or after the 1st day of January 1941 shall, on being brought into Australia, be acquired by the Commonwealth. 4. This order shall not apply to pears of the variety known as Williams Bon Chretien ... which are intended to be used for canning, dehydration, juice production or other similar manufacturing or processing purpose and are subsequently so used."

The regulation (reg. 15) under which the charge in this case was laid is above set out. This regulation, it was argued, is in excess of power, because it prohibits any change in place or position of apples or pears acquired by the Commonwealth, no matter how innocent or trivial the movement may be. This is not accurate, for the prohibition is directed against acts not sanctioned by the regulations, e.g., regs. 14 (Statutory Rule 1940 No. 276) and 21 (1939 No. 148), or not consented to by the board. In any case the power conferred upon the Governor-General includes prescribing all matters which are necessary or convenient for carrying out or giving effect to this Act. The regulation is against unauthorized movement of apples and pears acquired by the Commonwealth and for the purpose of protecting its property, rights and interests. It is a regulation convenient for that purpose and indeed almost necessary. Some extravagant cases were suggested which, it was said, would fall within the prohibition. But it must not be assumed that every unauthorized movement of apples and pears acquired by the Commonwealth contravenes the regulation. It is a question of mixed law and fact, in the determination of which common sense will often afford as good a guide as minute legal analysis: See Customs Act 1901-1935, sec. 33; Symons v. Schiffmann[5]; McNeill v. Whitton[6]; Wilson v. Chambers & Co. Pty. Ltd.[7]. In the present case, there is no doubt that the appellant did move the apples acquired by the Commonwealth; he was taking them to market or to a cool store without any authority.

It was also contended that the regulations provide for the acquisition of apples and pears on terms that are not just. The argument is based, I apprehend, upon the American doctrine that the mere existence of a state of war does not suspend or change the operation of the guarantees and limitations of the American Constitution upon the power of Congress. Thus the 5th amendment of the Constitution guarantees that no person shall be deprived of life, liberty, or property without due process of law, and that no private property shall be taken for public use without just compensation (Hamilton v. Kentucky Distilleries & Warehouse Co.[8]; United States v. Cohen Grocery Co.[9]) unless, perhaps, an actual war emergency or military necessity so requires: Cf. Ruppert v. Caffey[10], in arguendo; Willis, Constitutional Law, (1936), pp. 445, 446; Willoughby on The Constitution, 2nd ed. (1929), vol. 3, sec. 1033, pp. 1568-1570. Constitutional guarantees such as are contained in the 5th amendment have no counterpart in the Australian Constitution. But it is provided by sec. 51 (xxxi.) of the Australian Constitution that the Parliament shall, subject to the Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to "the acquisition of property on just terms from ... any person for any purpose in respect of which the Parliament has power to make laws." One of those powers, sec. 51 (vi.), is with respect to the naval and military defence of the Commonwealth and the several States. According to Isaacs J. in Farey v. Burvett[11], war "gives by the very nature of the circumstances a paramount authority to the defence power." There is nothing in the Constitution, I think, that warrants that statement. "There is no hierarchy in the powers, with the power as to defence on the top" (Farey v. Burvett[12], per Higgins J.). Each power contained in sec. 51 is an independent and separate power, and its content must be found in the words in which it is expressed, subject nevertheless to the ordinary rules of interpretation. An express power to acquire property on just terms for any purpose in respect of which Parliament has power to make laws indicates a legislative intent that property shall not be acquired by the Commonwealth for any purpose in respect of which it has power to make laws unless on those terms. Actual war operations and military necessity may require further consideration, but, putting that aside, the provisions of the Constitution, in my opinion, preclude the Commonwealth from acquiring any property from any person otherwise than on just terms.

Compensation has been provided in the present case, but the question is whether the terms are just. The rights and interests of every person in apples or pears acquired by the Commonwealth are converted into claims for compensation. Standing alone, that provision conforms to the requirements of the Constitution, for the right to compensation is conferred, and compensation would be recoverable, by due process of law. But it was argued that regs. 14 (1940 No. 276) and 17 (1939 No. 148) prescribe conditions upon which the right to compensation depends, or regulate the procedure for its ascertainment and determination in a manner that is not just. Thus it was said that under reg. 14 the right to compensation depends upon the board giving notice in writing requiring the apples or pears to be consigned. But that does not condition either the right to compensation nor the procedure for its recovery. The regulation certainly empowers the board to require delivery or consignment of the apples or pears acquired, but neither the acquisition nor the compensation depends upon the notice.

Then reg. 17 was attacked upon several grounds. "Just terms" required, it was argued, "an impartial tribunal and the usual rights and privileges which attend judicial investigations" (Cooley's Constitutional Limitations, 8th ed. (1927), vol. ii., p. 1207). But the regulation, it is said, makes the right to compensation depend upon delivery or consignment in accordance with reg. 14, or instructions from the board, and remits the ascertainment of the amount of compensation to the discretion of the Minister upon the recommendation of the board and does not even require him to make any determination of the amount until, in his opinion, a sufficient quantity of apples or pears were disposed of to enable the board to make a just recommendation. The argument is based upon the proposition that the regulation gives the right to compensation but prescribes the method of enforcing it, which must be followed. Reg. 17, however, is permissive in terms. It provides that every person having any right or interest in the apples or pears may forward a claim. Furthermore, the regulation does not provide for cases in which apples or pears were acquired, but which the board had not required to be delivered or consigned, or given any instruction for their disposal. According to counsel for the appellant, the board refused to pay any compensation in such cases, and the apples or pears rotted on the trees or on the ground, but counsel who appeared in the board's interest denied this assertion and contended that the right to compensation, given by reg. 14, was absolute, and pointed out that practical effect had been given to this view by an appropriation of £750,000 by the Parliament (1940 No. 73) for the purpose of repaying to the Commonwealth Bank moneys advanced for the purposes of the Apple and Pear Acquisition Regulations.

The question, however, turns upon the construction of the regulation. In my opinion, the right to compensation given by reg. 12 is absolute, and the provisions of regs. 14 and 17 do not condition that right nor provide an exclusive method of enforcing it. They provide a summary method for determining compensation but, I think, only a method alternative to the ordinary process of the courts of law. Assume, however, that the regulations provide the only method of enforcing the right to compensation, still, in my opinion, they do not contravene the provisions of sec. 51 (xxxi.) of the Constitution. It should be observed that the power conferred by the National Security Act 1939-1940, sec. 5 (1) (b), is general in its terms, "the acquisition on behalf of the Commonwealth of any property other than land," but it must be read and construed subject to the Constitution (Acts Interpretation Act 1901-1937, sec. 15A). It was not suggested that compensation must be assessed by some judicial tribunal: but, as already indicated, that "just terms" involved an impartial tribunal and an opportunity of being heard. But this proposition is founded upon principles deduced by the Supreme Court of the United States from the "due process" clause of the American Constitution—See Willis, Constitutional Law, (1936), ch. XXIII.—which has no counterpart in the Australian Constitution. It has been held, however, that the Parliament under the Australian Constitution can entrust judicial power to no other tribunal than a court (Waterside Workers' Federation of Australia v. J. W. Alexander Ltd.[13]; New South Wales v. Commonwealth[14]: see per Isaacs J.[15]). Still, functions resembling judicial functions may lawfully be conferred upon tribunals other than a court, such as the assessment of tax (Federal Commissioner of Taxation v. Munro[16]; Shell Co. of Australia Ltd. v. Federal Commissioner of Taxation[17]) or, as in the present case, the assessment of the amount of compensation to which persons are entitled by reason of the provisions of reg. 12. No-one has any right to a given mode of procedure. It is for the legislature or the regulation-making authority to prescribe the tribunal, the procedure, and the manner in which the compensation shall be ascertained and assessed. In this view, it is beyond the function of the courts to consider whether the Minister is or is not an impartial tribunal, or whether the procedure devised by the legislative authority gives the persons whose apples and pears have been acquired a fair opportunity of being heard. If it were the function of the court to consider the matter, I should think that the Minister was a rather partial tribunal, that is, partial towards the persons whose apples and pears have been acquired. The Minister is surrounded by a board and State committees representative of the persons whose property is acquired, and who are entitled to be paid such amount of compensation as the Minister, on the recommendation of the board, determines. Indeed, the whole scheme of the regulations is designed to give the persons whose property is acquired more than they could ever hope for in any available market or in any court of law, and even contemplates the use of moneys appropriated by Parliament for that purpose (reg. 24), and for which in 1940 a sum of no less than £750,000 was actually appropriated. One may admire the ingenuity of counsel in propounding reasons for the conclusion that the regulations empower the Commonwealth to acquire apples and pears on terms that are not just, but taxpayers may, I am afraid, think that the tribunal need not have been quite so favourable, nor the terms so likely to be more than just.

Further, it was argued that the regulations and the order made under them are beyond the powers conferred by the National Security Act 1939-1940, because the regulations are not for securing the public safety and the defence of the Commonwealth or its territories. The validity of the Act itself was not attacked (Wishart v. Fraser[18]). I agree that the particular provision in sec. 5 (1) authorizing regulations for the acquisition on behalf of the Commonwealth of any property other than land is, as a matter of construction, related to the main purpose of the Act, securing the public safety and defence of the Commonwealth and its Territories. Otherwise it would transcend the constitutional power of Parliament with respect to the naval and military defence of the Commonwealth and of the several States (Constitution, sec. 51 (vi.)).

The authority conferred upon the Governor-General is doubtless very extensive. It extends to all regulations necessary to the prosecution of war: it is not limited to operations in the field. It is not for this court to determine whether the regulations secure or aid in securing the public safety and defence of the Commonwealth and its Territories; it is sufficient if the regulations are capable of securing or aiding, or tend to secure or aid, the defence of the Commonwealth and the States (Farey v. Burvett[19]). The regulations must not transcend the constitutional power of the Commonwealth or any limitations imposed upon that power by the Constitution itself. But within these limits the duty is laid upon the courts to examine the regulations and determine whether they are within power. And it is perhaps as well to remember that the content of the defence power never alters, though the circumstances calling for its exercise may alter in time of war, and to those new circumstances the defence power extends.

Now it is said that the regulations on their face are not connected with the defence of the Commonwealth or the prosecution of the war, but merely establish a marketing scheme designed for the economic protection of a limited class of the community, who are affected by conditions arising out of the war. It is common knowledge that the consumption of apples and pears in Australia is not sufficient to absorb the output. In 1936 and 1937, bounties were paid on their export (1936 Nos. 4 and 46, 1937 No. 36). In 1938, Acts were passed relating to the marketing of apples and pears, the main purpose of which was to control the export of apples and pears and contracts relating to shipments and the insurance thereof (1938 Nos. 58 and 59). And further in 1938, Acts were passed for the purpose of assisting in the production and marketing in Australia of apples and pears (1938 Nos. 61, 62 and 63). But the outbreak of war in 1939 affected the shipping position and led to disorganization in the marketing of apples and pears. It did so with respect to other primary products, such as meat, butter, wine, citrus fruits, and other commodities. The legislative provisions for marketing of apples and pears already noticed became ineffective, and this led to the regulations which are challenged. It is an idle pretence, however, to say that the object of the regulations was to maintain food supplies for the troops or the civil population of Australia or the Empire or to regulate the prices of the commodities in aid of the civil population, which was the basis of the decision in Farey v. Burvett[20], or that the regulations are capable of achieving any such object. The shipping position prevents transport of the commodities to the troops, as clause 2 of the regulation makes plain, and the local consumption of the commodities is not, as already mentioned, sufficient to absorb the output of apples and pears in Australia.

It is suggested, however, that the regulations are directed to the support of the economic front, and therefore, I suppose, part of an agricultural policy. The effect of the regulations is to give a limited class in the community a remunerative price for their apples and pears, merely because war has interfered with the marketing of their commodities. The regulations have no relation whatever to the economic front of the community, but prop up, at the expense of the community, a limited class of the community who are affected by the war. Indeed, the economic front of the community as a whole is more likely to be weakened than strengthened by the regulation if the appropriation of such a large sum as £750,000 is necessary for the purpose of the regulation. Almost every citizen is injuriously affected by the war, and the argument we have heard leads apparently to the conclusion that in time of war the Commonwealth has complete power to legislate in respect of the social and economic condition of Australia. But I cannot agree. After all, the government of Australia is a dual system based upon a separation of powers, and the States have ample power and authority to relieve their populations affected by war conditions. Wide as is the power of the Commonwealth in relation to defence, still it does not, in my opinion, enable the Commonwealth to seize control of the marketing of commodities of all or any who are in need or in distress because of the war, and pay them remunerative prices for their commodities, obtained from their disposal, aided by grants from Parliament. That is not the defence of the Commonwealth, but largely bounty on the part of the Commonwealth to favoured members of the community from funds provided by means of taxation and otherwise.

It is not necessary, in this view, to consider whether the regulation and order made under it contravene the provision made by sec. 92 of the Constitution, but as the matter has been argued I shall express my opinion upon the subject. "Trade, commerce, and intercourse among the States ... shall be absolutely free." That provision in sec. 92 of the Constitution binds the Parliaments of the Commonwealth and the States alike (James v. The Commonwealth[21]). It may be regarded as a constitutional guarantee or a limitation upon the power of the Parliaments. It limits the defence power of the Commonwealth, as well as its trade and commerce power. But the extent of the limitation, and its practical operation, despite the many cases expounding the meaning of the section, still remain obscure. All that is certain is that the effectiveness of the section as a constitutional guarantee has been much reduced by judicial decisions and reasonings. Legislation which is attacked upon the ground that it contravenes the section must, I gather, be scrutinized in its entirety and its object gathered from its language and its effect (James v. Cowan[22]; W. R. Moran Pty. Ltd. v. Deputy Federal Commissioner of Taxation for New South Wales[23]; Peanut Board v. Rockhampton Harbour Board[24]). According to Isaacs J. in James v. Cowan[25], the right of inter-State trade protected by sec. 92 from interference and regulation is a personal right attaching to the individual and not attaching to the goods. It is true enough that the regulation and the order acquiring apples and pears prevent the exercise of that right. But they do so without any reference to inter-State trade expressly "either as a criterion of authority or as a description or attribute of the property to be acquired" (James v. Cowan[26]). The purpose or object of the regulations as stated in reg. 2 is to minimize the disorganization in the marketing of apples and pears because of the effects upon shipping of the present war. The expropriation of the apples and pears is not directed wholly or partially against inter-State trade, that is, selling them out of any State, but to the better disposal of the commodities in local as well as other markets, if possible. Such legislation, it appears, is not obnoxious to sec. 92. The Wheat Case[27], James v. Cowan[28], and James v. The Commonwealth[29] support this view, and the case is not governed by the decision in Peanut Board v. Rockhampton Harbour Board[30]. I do not profess to understand the decision of this court in Hartley v. Walsh[31] or in Milk Board (N.S.W.) v. Metropolitan Cream Pty. Ltd.[32], but the general reasoning of the majority of the court in each case supports the view that the Apple and Pear Acquisition Regulations are not obnoxious to the provisions of sec. 92.

In my opinion, the appeal should be allowed.

Dixon J.

This is an appeal under sec. 39 (2) (b) of the Judiciary Act 1903-1940 from a conviction by a Court of Petty Sessions exercising Federal jurisdiction.

The appellant was convicted upon a charge that on or about 26th January 1941, at Melbourne he did, contrary to the National Security Act 1939-1940, contravene a provision of the National Security (Apple and Pear Acquisition) Regulations in that he did move twenty-seven cases of apples acquired by the Commonwealth which were held in his possession. The information by which the charge was laid went on to aver that on or about the said day the said apples had been acquired by and were the property of the Commonwealth. The regulations under which he was convicted consisted of the National Security (Apple and Pear Acquisition) Regulations made on 13th November 1939: Statutory Rules 1939 No. 148, as amended by Statutory Rules 1940 Nos. 13, 38, 60, 276, 283 and 295. After the date laid as that upon which the offence was committed, the regulations were further amended by Statutory Rules 1941 No. 79, but those amendments do not apply to the appeal.

The appeal is based upon the ground that the regulations, or so much of them as create the offence of which the appellant was convicted, are beyond the powers which the National Security Act 1939-1940 purports to confer, or could confer, upon the Governor-General in Council.

The National Security (Apple and Pear Acquisition) Regulations were made as under sec. 5 (1) of the National Security Act. The validity of the regulations depends upon the general words contained in that sub-section, which are as follows: "The Governor-General may make regulations for securing the public safety and the defence of the Commonwealth and the Territories of the Commonwealth ... and for prescribing all matters which ... are necessary or convenient to be prescribed for the more effectual prosecution of any war in which His Majesty is or may be engaged or for carrying out or giving effect to this Act." Par. b of sec. 5 (1) contains a particular power which may be material, viz., a power to make regulations for authorizing the acquisition on the part of the Commonwealth of any property other than land in Australia.

The object of the Apple and Pear Acquisition Regulations is expressly stated in reg. 2, which is as follows: "The purpose of these regulations is to minimize the disorganization in the marketing of apples and pears likely to result from the impracticability of exporting sufficient quantities of apples and pears because of the effects upon shipping of the present war and these regulations shall be administered accordingly."

I understand this to mean that the very large export trade in apples and pears carried on by means of ships with refrigerated space was found impracticable, because the prosecution of the war made it necessary or expedient to use the refrigerated space for the importation into Great Britain of other foodstuffs, and that the plan contained in the regulations was adopted by the government as a substitute, in order to reduce the difficulty in marketing apples and pears which the decision to use refrigerated shipping space for other foodstuffs would involve. The regulations were made before ships had been lost through enemy action to any serious extent.

The plan appearing from the regulations as amended is to set up a marketing board for the purpose of disposing of apples and pears grown in the Commonwealth by orchardists, subject to an exception of small areas not principally used for growing apples or pears. Occupiers of orchards growing those fruits are required to register with the board. They must make a return of fruit grown, and after 1st March 1940 no person may sell apples or pears except those grown by a registered grower.

The Minister of Commerce is empowered to make provision, by an order published in the Gazette, for the acquisition by the Commonwealth of any apples or pears described in the order, whether by reference to any contingency or otherwise; and thereupon those apples and pears, by force and in accordance with the provisions of the order, are to become the actual property of the Commonwealth free from all mortgages, charges, &c., and the rights and interests of every person therein are, by the regulation, "converted into claims for compensation" (reg. 12). This power has been exercised by an order which provides that all apples and pears harvested during the year beginning on 1st July 1940 shall, upon being harvested, be acquired by the Commonwealth, subject to certain exceptions and qualifications not material to this appeal. The regulations require that persons having apples or pears acquired by the Commonwealth in their possession, control or disposal on the date of the acquisition shall, within fourteen days, furnish a return giving particulars of the fruit (reg. 13). On receipt of a notice from the board such a person must deliver or consign the apples or pears to an agent, packing shed, cool store, or any other person or place specified in the notice (reg. 14).

Reg. 15 is the provision under which the appellant was convicted. As amended it is in the following terms:—"Except as provided by these regulations, or with the consent of the board, no person shall (a) part with the possession of or move any apples or pears acquired by the Commonwealth which are held in his possession; (b) take into his possession any apples or pears which are the property of the Commonwealth; or (c) purport to sell or offer for sale, or purport to buy or offer to buy any apples or pears which are the property of the Commonwealth." The board is armed with extensive powers, which include the sale or disposal of apples or pears acquired or purchased by the Commonwealth; the management and control of all matters connected with the handling, storage, protection, treatment, transfer or shipment of apples or pears acquired by the Commonwealth; inspection of apples or pears and orchards, and the encouragement and extension of the use of apples for canning, drying, manufacturing and processing.

A specific provision is made with respect to the payment of compensation for apples and pears acquired by the Commonwealth; but its effect may be more conveniently considered in dealing with one of the contentions advanced by the appellant, namely, that the acquisition is not upon just terms within the meaning of sec. 51 (xxxi.) of the Constitution. The appellant maintains that the regulations are void upon grounds which may be stated as follows:—

First, he says the whole plan falls outside the power conferred upon the Governor-General to make regulations for securing the public safety and the defence of the Commonwealth and for prescribing matters which are necessary or convenient for the more effectual prosecution of the war, and falls outside the legislative power of the Commonwealth with respect to naval and military defence (sec. 51 (vi.)).

Secondly, he says that the plan involves an interference with the freedom of inter-State trade and commerce which sec. 92 of the Constitution will not allow, and that the plan forms an inseverable whole, so that, in common with the rest of the regulations, the provision for the acquisition of apples and pears, and the provision, under which the appellant was convicted, prohibiting the movement of any apples or pears acquired by the Commonwealth by any person holding them in his possession, are void.

Thirdly, he says that the particular regulation governing the acquisition of apples and pears and providing for compensation to be made for apples and pears acquired by the Commonwealth does not comply with the condition expressed in sec. 51 (xxxi.) of the Constitution: that is to say, it does not amount to a law for the acquisition of property on just terms.

Fourthly, he says that, independently of the foregoing objections, the amendment, which specifically provides that a person having possession of apples or pears acquired by the Commonwealth shall not move any of them, is so wide and unreasonable that it cannot be justified as incidental to the power to make regulations to secure the public safety and the defence of the Commonwealth or for the more effectual prosecution of the war.

I shall deal with these objections to the validity of the regulations in order.

So construed I think the provision is valid.

I am therefore of the opinion that all the objections to the validity of the regulations fail. Accordingly I think the appeal should be dismissed with costs.

McTiernan J.

The appellant was convicted of an offence against the National Security Act 1939-1940, sec. 10 (1) of which makes it an offence against that Act to contravene any provisions of any regulations made in pursuance of the Act. The appellant contravened a provision of the National Security (Apple and Pear Acquisition) Regulations forbidding any person from moving, except as thereby permitted, any apples or pears acquired by the Commonwealth which are held in his possession. This prohibition is to be found in reg. 15 (a) of Statutory Rules 1939 No. 148, as amended by reg. 9 of Statutory Rules 1940 No. 276. The order convicting the appellant was made by a Court of Petty Sessions at Melbourne, and the appeal is brought under sec. 39 (2) (b) of the Judiciary Act 1903-1940 and in the manner prescribed by rule 1 of sec. IV. of the Appeal Rules of this court.

The grounds of the appeal are that the National Security (Apple and Pear Acquisition) Regulations are invalid, and that reg. 15 (a) as amended is ultra vires even if the rest of the regulations be valid.

At the date of the alleged offence the regulations in force were, besides those contained in Statutory Rules 1939 No. 146 and 1940 No. 276, the National Security (Apple and Pear Acquisition) Regulations, to be found in Statutory Rules 1940 Nos. 13, 38, 60, 283 and 295. The regulations were made by the Governor-General with the advice of the Federal Executive Council. In making the regulations contained in Statutory Rules 1939 No. 148 the Governor-General purported to exercise the powers conferred on him by the National Security Act 1939. The other statutory rules were similarly made under that Act, or as amended by the National Security Act 1940. The powers which the Governor-General purported to exercise include that of making regulations for securing the public safety and defence of the Commonwealth and its Territories, and for prescribing all matters which are necessary or convenient to be prescribed for the more effectual prosecution of the war. By sec. 5 of the amending Act the war means any war in which His Majesty is or may be engaged. The Governor-General declared in reg. 2 of Statutory Rules 1939 No. 148 what was the purpose of the regulations. It is declared in these terms: "The purpose of these regulations is to minimize the disorganization in the marketing of apples and pears likely to result from the impracticability of exporting sufficient quantities of apples and pears because of the effects upon shipping of the present war and these regulations shall be administered accordingly." The facts stated in this regulation are not challenged, nor is there any denial of the existence of the emergency which they profess to meet. But it is contended that because of the purpose for which the regulations are declared to have been made they are not reasonably capable of being described as regulations for securing public safety and defence, and are therefore in excess both of the powers conferred on the Governor-General by the National Security Act and of the defence power of the Commonwealth. The disorganization which the regulations aim at minimizing is a plain and direct consequence of the war. It is the result of the diversion of ships upon which the export trade in apples and pears depends to war purposes and of the loss of shipping by enemy action. The disorganization caused by the war in the important industry of producing fruit for export and home consumption impairs the economic integrity of the country. It cannot be doubted that measures taken to repair such damage or to strengthen the nation's economy to enable it to withstand the impact of war directly contribute to the power of its defensive arms. The nature and extent of the defence power of the Commonwealth are explained and illustrated by the following cases: Farey v. Burvett[45]; Welsbach Light Co. of Australasia Ltd. v. Commonwealth of Australia[46]; Pankhurst v. Kiernan[47]; Ferrando v. Pearce[48]; Sickerdick v. Ashton[49]; Burkard v. Oakley[50]. The emergencies to which war gives rise will justify the Commonwealth in making laws with respect to defence which may not be justified in time of peace. The scope of such emergencies cannot be predetermined. But the defence power adjusts itself to meet whatever emergencies war produces and especially to any such emergency as might affect the country's power to defend itself: Cf. Fort Frances Pulp and Power Co. v. Manitoba Free Press Co.[51]. In my opinion the regulations are not ultra vires the Governor-General or the Commonwealth.

Another objection to the regulations is that they violate sec. 92 of the Commonwealth Constitution.

The apples which the appellant was charged with moving in contravention of reg. 15 (a) were not the subject of any transaction of inter-State trade. But it is contended that as it is essential to the purpose of the regulations that there should be no independent inter-State sales of apples and pears their operation cannot be limited to intra-State sales and the whole scheme embodied in the regulations must therefore collapse under the constitutional prohibition. It is startling to contemplate that measures taken by the Commonwealth which can be justified only on the hypothesis that they are necessary for or conduce to the defence of the Commonwealth would be invalid if they should interfere with freedom of trade and commerce among the States. In Farey v. Burvett[52] Isaacs J., as he then was, denied that sec. 92 could override any measures taken by the Commonwealth in time of war under the defence power for securing the public safety and the defence of the country. His Honour based that conclusion on the nature and extent of the power. But it may now be said that because of the meaning which recent decisions have placed upon sec. 92 there could seldom, if ever, be any opposition between that section and a law which is directed to securing the safety and defence of the Commonwealth but operates adversely to the freedom of inter-State trade and commerce although not directed against it. I refer especially to the observations of the Privy Council reported in James v. Cowan[53] and in James v. The Commonwealth[54], and to the observations of Latham C.J. in Milk Board (N.S.W.) v. Metropolitan Cream Pty. Ltd.[55]. Remembering that the declared purpose—the real purpose—of the present regulations is one of defence, the ratio decidendi of the last-mentioned case makes the appellant's objection founded on sec. 92 untenable.

The appellant also attacks the regulations on the ground that they fail to provide for the acquisition of the fruit on just terms. This objection assumes that the power of the Commonwealth to acquire the fruit for the purpose of the scheme embodied in the regulations is derived solely from sec. 51 (xxxi.) of the Constitution. It is not now necessary to decide whether this is a correct assumption. In my opinion the regulations do provide for compensation on just terms. It is obvious, of course, that they are not confiscatory. I am in agreement with the reasons which my brother Dixon has given for saying that upon the true construction of the regulations they do safeguard the right of any person whose fruit is expropriated to a fair assessment of his claim for compensation.

The last objection is that reg. 15 (a) extends to the prohibition of making any change, however minute the distance, in the position of any fruit, and for that reason is in excess of any purpose which could reasonably be related to the purpose of defence. Before amendment, reg. 15 (a) forbade any person to part with the possession of any apples or pears held in his possession. That prohibition remains, and to it is added the prohibition that no person shall move such fruit. The regulation postulates that fruit which is acquired by the Commonwealth is held by a person in his possession at some place. The intention of the amendment is to prevent him from moving it to another place, but not necessarily from one spot within that place to another spot within the same place. The amendment prohibits a moving the result of which could be described by saying that whereas the fruit was held at one place it is now to be found at a different place. Upon that construction of the regulation I think it was a provision which was necessary to the scheme embodied in the regulations. In my opinion this particular objection which is made to reg. 15 (a) also fails.

I agree, therefore, that the appeal be dismissed with costs.

Appeal dismissed with costs. Order nisi discharged.

Solicitors for the appellant, Malleson, Stewart, Stawell & Nankivell.

Solicitor for the respondent, H. F. E. Whitlam, Crown Solicitor for the Commonwealth.