Smith v Capewell
142 CLR 50926 ALR 507
(Judgment by: Barwick CJ)
Between: Smith
And: Capewell
Judges:
Barwick CJGibbs J
Stephen J
Mason J
Murphy J
Aickin J
Subject References:
Constitutional Law (Cth)
Judgment date: 4 October 1979
Melbourne
Judgment by:
Barwick CJ
The respondent is a dealer in, amongst other things, kangaroo skins. His place of business is in Charleville, Queensland. He obtains such skins in Queensland, having authority under the legislation of that State to be in possession of them. He obtains from time to time authority under that legislation to sell them to purchasers, including purchasers in other States.
The respondent sold certain kangaroo skins which he had procured in Queensland to a purchaser in New South Wales. He delivered them from Queensland to the buyer in New South Wales. However, the purchaser rejected the skins for disconformity with the contract of sale. The respondent thereupon sold these skins (the rejected skins) to another purchaser in New South Wales.
The respondent also sold to the same purchaser other kangaroo skins which he brought from Queensland and delivered in New South Wales in satisfaction of the purchase. This transaction I will refer to as the "other sale".
But in neither contract of sale was there a stipulation that the skins be delivered from Queensland into New South Wales. The export of all these skins from Queensland into New South Wales was covered by an authority under the legislation of that State.
The respondent was charged with a breach of s. 105 (a) of the National Parks and Wildlife Act, 1974 (NSW), as amended ("the Act"), which sub-section I set out in full:
"A person shall not -
- (a)
- exercise or carry on;
...
the business of a skin dealer, unless he does so under and in accordance with the authority conferred -
- (d)
- by a skin dealer's licence under section 125; or
- (e)
- in so far as the act constituting the offence forms part of the business of a fauna dealer - by a fauna dealer's licence under section 124."
The respondent had no such licence under the Act. It is quite clear from the provisions of s. 125 of the Act that such a licence is not obtainable as of right. Its grant lies in the discretion of a government official.
There was some confusion in the court papers as to the sale which was the subject of that charge.
The magistrate before whom the respondent was charged appears to have treated the sale of the rejected skins as the subject matter of the charge. But, from a comparison of dates, it would appear that the other sale to the same purchaser was that subject matter. The magistrate found that the respondent had carried on in New South Wales the business of a skin dealer as charged but dismissed the information on the ground that the relevant section of the Act did not validly apply to the transaction, i.e. the sale of the rejected skins, upon which he thought the prosecution had relied to establish the charge because that sub-section transgressed s. 92 of the Constitution.
This appeal is brought by the prosecution by the special leave of this Court.
The first question is whether s. 105 (a) infringes the freedom of interstate trade guaranteed by s. 92. The sub-section does not expressly limit its prohibition to the carrying on of business as a skin dealer in New South Wales. But s. 14A (1) of the Interpretation Act, 1897 (NSW), as amended, would effect such a limitation.
Of course, some part of an interstate trade in animal skins, as indeed of all interstate trade in goods, must take place within each of the States between which the interstate trade takes place.
If the evidence of the interstate trade be established by proof of the transport of the goods from one State to another, only the actual transit over the border itself will not take place in one State or the other.
If the existence of the trade is to be made out by proof of contractual arrangements, probably, though perhaps not necessarily, some part of the steps to form the contract would have taken place in each State. But to establish the existence of the trade merely by the existence of a contract, the transport of the subject matter from one State to another must necessarily occur if the contract is to be duly performed. Thus, in general, the evidence of the interstate trade by means only of a contract will only be possible if delivery from one State to another is a term of the contract, express or implied. Of course, if a contract of sale so stipulates, the contract itself is part of interstate trade and commerce.
But it would seem such a trade may be established where it is implicit in the nature of the transaction relied upon to establish such trade or by a course of dealing, that it was the common contemplation of the parties that the subject matter of their agreement would be transported interstate. Reg. v. Wilkinson; Ex parte Brazell, Garlick & Co. (1952) 85 CLR 467 is, in my opinion, an illustration of such an occasion. It was established in that case that the vendor only sold to the purchaser because the purchaser assured him that he was "buying for interstate". There was no written contract and, in my opinion, the evidence did not go so far as to establish a contractual obligation on the part of the purchaser to transport the potatoes interstate. In fact, he did so: and, clearly, it was in mutual contemplation that he would do so. But as a generalisation it can, in my opinion, be said that only a contract which stipulates for interstate movement or delivery will itself form part of interstate trade. It may also establish the existence of such a trade.
But it is proper to observe that that instance of a transaction given in W. & A. McArthur Ltd. v. Queensland (1920) 28 CLR 530 , at p 540 does not purport to exhaust the way in which interstate trade in goods may take place. The instances given in McArthur's Case were peculiarly relevant to the facts of that case. Transport over the border for sale, whether or not in pursuance of a contract of sale requiring such transport, is clearly part of interstate trade and commerce. To prevent the sale of the delivery on importation of the imported goods must necessarily offend s. 92.
Here, no doubt, an interstate trade could not be established in relation to the subject skins merely by the terms of a contract of sale.
In the present instance, on the facts to which I have referred, the respondent was undoubtedly engaged in transporting skins from Queensland to New South Wales for sale in New South Wales, or in performance of a contract of sale, i.e., one which did not stipulate for interstate delivery. He had imported the rejected skins, for delivery to a purchaser and he had imported the skins the subject of the other sale for delivery to a purchaser.
The sub-section of the Act deals with the carrying on of the business of a skin dealer, without a licence under the Act. Part of the respondent's business in selling skins and transporting them from one State to another for delivery to a buyer in the second State must inevitably take place in New South Wales. If no other part, at least the act of delivery itself; but also the solicitation of business and the negotiation of terms of sale. It is convenient to recall the width of the concept of interstate trade in McArthur's Case (1920) 28 CLR, at p 547 . Therefore, if the sub-section, properly read, would prevent the sale or delivery upon importation of the skins in the course of the business of a skin dealer, it would, in my opinion, be pro tanto inoperative.
I have elsewhere indicated that sale in the second State of goods brought in the course of business into that State for sale forms part of the interstate trade in the subject matter of the transportation. To forbid the trader who has so imported for sale from selling or delivering the imported article in the second State is, in my opinion, in clear conflict with s. 92. If carrying on business within the meaning and operation of the sub-section embraces the sale upon importation of a commodity brought interstate for sale, it is, in my opinion, inoperative .
To relate these propositions to the instant case, it is apparent that the skins the subject of the other sale were imported into New South Wales by the respondent for delivery there to the purchaser.
Although the sale of the rejected skins was not the subject of the charge, I would reiterate that they were imported from Queensland into New South Wales for sale there. The sale of those skins, made subsequent to their rejection, was a sale made immediately on importation. The intervening delivery to and rejection by the original purchaser does not preclude that conclusion. On their rejection the skins did not cease to be skins imported for sale and as yet unsold. The abortive transaction did not act as a mediating circumstance precluding the subsequent sale being a sale immediately on importation; in other words, a first sale on importation for sale.
Thus, if entering into and completing the transaction with the other skins would constitute carrying on business within the terms of s. 105 (a) of the Act, the section would be inoperative to render the respondent liable under the section because of s. 92. The operation must be confined to purely intrastate activities.
There is a second approach to this charge which in some sense is but a reflection of what I have already said, namely, one of fact. Did the respondent carry on business as a skin dealer in New South Wales within the meaning of the sub-section?
The expression "carry on business" would in general refer to some repetitive act in a trade and only rarely be satisfied by the proof of only one transaction. Further, as it appears in the sub-section, the expression necessarily refers to carrying on a business at a place in New South Wales. By this I do not mean that in order to satisfy the sub-section there must be use of business premises: it would suffice if the acts constituting the carrying on of a business occurred in a street without the panoply of an office or shop. But at least the business must be carried on in New South Wales. The fact that the respondent had his place of business in the sense of his office, shop, or headquarters in Queensland does not deny the possibility of concluding that, in relation to some specific period of time, he carried on business in New South Wales. But, allowing that proof of a single transaction may establish the carrying on of a business within the intention of the sub-section, the circumstances under which a single transaction takes place must be considered. Also, the interstate nature of the respondent's operation cannot be left out of consideration when determining whether a particular transaction amounts to carrying on a business in New South Wales.
Here, if it be thought that the sale in the rejected skins, either alone or in conjunction with the sale of the skins the subject of the other sale, assisted to support a conclusion that a business was being carried on in New South Wales, it should be pointed out that we know the circumstances in which the transaction in the rejected skins took place and it was, as I have indicated, a transaction in the course of interstate trade. The sale to the purchaser who rejected the goods could not possibly be held, in my opinion, for the reasons I have given to be a carrying on or to form part of carrying on of the business in contravention of the sub-section. Both the concluded sales occurred in the "business" of importing goods into the State for sale or for delivery there. If the other sale of skins is relied upon to establish the carrying on of a business, what I have already said equally applies. I would not find that in either case the single sale in the circumstances of this case amounted itself to the carrying on of a business as a skin dealer within the operation of the sub-section; nor would I find that a combination of all the sales warranted that conclusion though they were business transactions entered into by the respondent as a skin dealer, and though the selling took place in New South Wales.
Thus, in my opinion, whilst I think he was in error in finding that the respondent relevantly carried on business as a skin dealer in New South Wales, the magistrate was correct in dismissing the information. I would dismiss the appeal .