The Secretary to the Public Service Commissioner has forwarded the following memorandum for advice:

I append copy of letter received from the Postmaster-General's Department relative to the question of payment of stamp duty in connection with a life assurance policy being brought under the provisions of the Commonwealth Public Service Act and Regulations, and am directed to ask that the Commissioner be favoured with the advice of the Crown Solicitor in regard to the case:

I have to inform you that in response to an instruction to assure his life an officer of this Department recently forwarded a life assurance policy effected with the Australian Mutual Provident Society. The policy in question had not been brought under the Commonwealth Public Service Act and Regulations, and it was therefore proposed to forward it to the Society for the necessary amendment. However, upon inquiry it was ascertained that in such cases a fee of 2s 6d for stamp duty was required.

2. The policy when issued originally was fully stamped to comply with the provisions of the Queensland Statute, and it seems to be wrong in principle that, when it is required to comply with Commonwealth legislation, the State should exact a further tax. It seems reasonable to assume that when an officer is ordered to take the action indicated here, and the policy is brought under the provisions of the Commonwealth Act, such a policy is a Commonwealth instrument, and should not be subject to such taxation. It is a question, indeed, whether any policy taken out under the provisions of the Commonwealth Public Service Act should require to be stamped to comply with the State Statute. In other cases of somewhat similar nature-for instance, those in which contractors receive money for work performed for the Department-no stamp duty is needed, although the same persons would be liable to prosecution if the Commonwealth were not involved as indicated.

The High Court in D'Emden v. Pedder 1 C.L.R. 91 held that if a State attempts to give its legislative or executive authority an operation which if valid would interfere to any, the smallest, extent with the free exercise of the legislative or executive power of the Commonwealth, the attempt unless expressly authorised by the Constitution is invalid and inoperative.

The Public Service of the Commonwealth in carrying out its duties as a public service is under the exclusive control of the Commonwealth, and by the Commonwealth Public Service Act and Regulations an officer on confirmation of his appointment is required to effect an assurance of his life under the prescribed conditions and conferring certain prescribed benefits, the policy to be handed over to the custody of the Department in which the officer is employed.

If the officer prior to appointment had effected an assurance not in accordance with the Act and Regulations, he is required to effect an assurance conferring benefits equivalent to those required under the Act and Regulations.

For a State to impose a stamp duty upon the policy of an officer of the Public Service on bringing into conformity with the Public Service Act and Regulations is, in my opinion, an interference with the discharge of a federal duty. In D'Emden v. Pedder the Court said:

The Federal Audit Act requires him for the purposes of a federal department to give a receipt for his pay, which receipt is to be preserved as a record of the department.The Stamp Act says in effect-'If you perform that duty without at the same time contributing to the State revenue, you will be liable to a fine, and in default of payment to imprisonment.' How can it be said that this is not an attempt to exercise control? The attaching by a State law of any condition to the discharge of a federal duty is assuredly an act of interference or control.

The bringing of the policy in question into conformity with the Public Service Act and Regulations being a duty cast on the officers by a legislative enactment of the Commonwealth in connection with the regulation of the Commonwealth Public Service, in my opinion, the policy is not liable to State stamp duty⁽¹⁾

[Vol. 13,p.40]

(1)Following the reciept of this advice the Public Service Commissioner asked whether the openion given applied'... to the case of a policy effected by an officer subsequent to his appointment to the Public Service, and in compliance with the provisions of the Public Service Act and Regulations derecting him to assure his life consequent upon his appointment'.

Mr garran on 7 November 1914[Vol.13,p.111]advised:

'The reasons stated in my openion of 14 september last, on the question of the liability of a policy of assurance to stamp duty under a State Act when the policy bought into conformity with the commonwealth Public Service Act,apply with equal force to a policy effected by an officer,subsequent to his appointment in the Commonwealth Public Service, and in order to comply with the Public Service Act such a policy therefore os not, in my openion,liable to State stamp duty'.