South Australia and Ors v Commonwealth and Anor
(1942) 65 CLR 373[1942] HCA 14
(Judgment by: Rich J)
Between: State of South Australia and Anor - Plaintiffs
And: Commonwealth of Australia and Anor - Defendants
Between: State of Victoria and Anor - Plaintiffs
And: Commonwealth of Australia and Anor - Defendants
Between: State of Queensland and Anor - Plaintiffs
And: Commonwealth of Australia and Anor - Defendants
Between: State of Western Australia and Anor - Plaintiffs
And: Commonwealth of Australia and Anor - Defendants
Judges:
Latham CJ
Rich JStarke J
McTiernan J
Williams J
Judgment date: 23 July 1942
Judgment by:
Rich J
I have had the privilege and advantage of reading the reasons which have been prepared by the Chief Justice. As I am in agreement with his Honour on all points but one, and substantially in agreement with his reasons save those concerned with the excepted point, no advantage, but rather disadvantage, would be produced by my publishing separately the reasons which have led me to arrive at the conclusions upon which we are in agreement. I confine myself, therefore, to stating my reasons for coming to the conclusion upon which I have the misfortune to disagree with the learned Chief Justice.
I agree with the view that the declarations sought that what have been described as the Tax Act, the Grants Act, and sec. 31 of the Assessment Act are invalid should not be made. I am of opinion, however, that the application for a declaration that the War-time Arrangements Act is invalid should also fail. The argument relating to this Act has centred chiefly upon the provisions of sec. 4. This provides, in effect, that the Treasurer may, at any time and from time to time, by notice addressed to the Treasurer of any State, cause any officers of the State service specified in the notice, who have been engaged in duties which, in the opinion of the Treasurer, are connected with the assessment or collection of taxes upon incomes, to be temporarily transferred to the Public Service of the Commonwealth. The Treasurer's powers in this respect are limited as to time by sec. 16, which provides that the Act shall continue in operation until the last day of the first financial year to commence after the date on which His Majesty ceases to be engaged in the present war, and no longer; and the temporary quality of the transfer is defined by sec. 5, which provides that, unless sooner retransferred, every transferred officer shall be retransferred to the State service immediately after the Act ceases to operate. The authority of the Parliament to entrust to the Treasurer the limited power contained in sec. 4 cannot be disputed (Hodge v. The Queen [F111] ; In re The Initiative and Referendum Act [F112] ; British Coal Corporation v. The King [F113] ; Lloyd v. Wallach [F114] ). The Act is expressed to be a war measure, created for the defence of the Commonwealth and the States and for the more effectual prosecution of the present war. The scope of the defence power was discussed by this Court in Farey v. Burvett [F115] , where Isaacs J., as he then was, in a passage which I quoted in Andrews v. Howell [F116] , said that in considering whether a measure is supportable as an exercise of the defence power "if the measure questioned may conceivably in such circumstances even incidentally aid the effectuation of the power of defence, the Court must hold its hand and leave the rest to the judgment and wisdom and discretion of the Parliament and the Executive it controls-for they alone have the information, the knowledge, and the experience and also, by the Constitution, the authority to judge of the situation and lead the nation to the desired end" [F117] . Applying this test, and the test laid down by the other members of the Bench in that case, I am unable to see anything in sec. 4, whether it be read alone, or in relation to the rest of the provisions of the Act in which it occurs, or in relation to the group of statutes with which that Act is associated, which justifies the conclusion that it is a colourable and not a real exercise by Parliament of the defence power. It is notoriously essential, for the effective prosecution of such a war as is now being waged, a war in which the continued existence of the Commonwealth and its constituent States is at stake, that the whole resources of the nation, whether of men or of things, should be marshalled and concentrated upon war effort. If the Commonwealth is to wage war effectively, it must command the sinews of war. The taxing of income is an important source from which the funds required for war purposes may be drawn; and the other Acts which have been brought in question show that the Commonwealth Parliament was determined to make unusually large drafts upon this source. In these circumstances, I see nothing sinister in a provision which enables the Commonwealth to take over from the State service and place under its own exclusive control for the period of the war, such of the officers employed in that service as it may specify, if those officers have been engaged on duties connected with the assessment or collection of taxes upon income, and are therefore, presumably, specially qualified to assist the Commonwealth by performing this essential service. Nor, if the section be read with an unjaundiced eye, do I see anything sinister, or anything suggesting that the section is intended to be used colourably and for the purpose of destroying each and every new State income tax office as and when it may be created, in the provision that the power may be exercised at any time and from time to time (although only during the period of the war). For aught I know, the view may be taken that State offices are overmanned, and therefore in all or some cases it may be proposed to specify in the first instance some only of the officers now employed in the State income tax offices, and to specify others afterwards if more are found necessary. Indeed, a military calamity, involving the destruction of a transferred building with its personnel, might make it necessary for the Commonwealth, in the interests of the war effort, to acquire the expert services even of a newly created office and specified members of a new staff which a State had brought into existence for its own civil purposes.
However this may be, I am of opinion that the powers conferred by sec. 4 are capable of being used for necessary purposes incidental to the defence of the Commonwealth. If at any time an attempt should be made to use them for what is suggested to be some other and unjustifiable purpose, the validity of the suggestion can be determined in proceedings to frustrate the attempt. It is unnecessary in order to dispose of the present matter to determine whether it would be competent for the Commonwealth Parliament, in exercise of the defence power, to exclude the States from a particular field of taxation altogether.
For these reasons I am of opinion that there is nothing in, or connected with, the provisions of sec. 4 which either calls for or warrants the conclusion by this Court that its enactment stands outside the defence power, or is a colourable as contrasted with a genuine exercise of that power.
As has been pointed out by the Chief Justice, the question whether any of the other provisions of the Act are obnoxious to placitum 51 (xxxi.) of the Constitution has not been argued and in these circumstances it would not be proper to rule upon the matter.
For the reasons which I have stated I am of opinion that the motion fails upon all points and that the declarations asked for should not be made or the injunction granted.