Opinion Number. 695

Subject

WAR PRECAUTIONS: PRICE FIXING WHETHER COMMONWEALTH HAS POWER IN WARTIME TO DETERMINE FREIGHTS

Author
Key Legislation

WAR PRECAUTIONS ACT 1914

Date
Client
The Treasurer

The Treasurer asks for advice on the question raised in the following letter:

Having reference to the accompanying letter from the Colonial Sugar Refining Company, in which it is shown that the shipping companies have raised the freights on sugar- To Fremantle

January 1915 to 31st January 1916 On and after 1st February 1916
From Sydney 17s 6d per ton £1 10s per ton
,, Melbourne 15s 0d ,, ,, £1 5s ,, ,,
,, Adelaide 12s 6d ,, ,, £1 2s 6 d

I shall be glad if you will let me know whether the Commonwealth Government has power under the War Precautions Act to determine freights. I desire, if possible, that the shipping companies shall be compelled to carry sugar at the rates which obtained between January 1915 and 31st January 1916.

Advice has already been given(1) that there is power, under the War Precautions Act, to fix maximum prices of necessaries of life-such as sugar and bread.

This matter, however, goes somewhat further. It relates to the price of a service-the service of transportation; and it suggests compulsion to carry at the rate prescribed.

I think it is open to doubt whether the Government has any general power to determine freights.

In this particular case, I understand that sugar and some other commodities have in the past been a 'cut line' and that the proposed increased rate for sugar is that which has for some time been ruling for general merchandise.

If that statement is correct, the regulation applicable to the case would require sugar to be carried at a lower rate than that ruling for general merchandise.

I am by no means prepared to say that the Government cannot, by War Precautions Regulations, exercise, any control over freights; but I think that a regulation of the kind would be of doubtful validity.

[Vol. 14, p. 276]

(1)Openion No. 690.

(2)This opinion is unsigned in the Opinion Book. but it is attributed to Mr Mahon.