Opinion Number. 760

Subject

FREEDOM OF INTERSTATE TRADE WHETHER STATE MAY IMPOSE HIGHER WHARFAGE CHARGES ON INTERSTATE GOODS THAN ON DOMESTIC GOODS: JURISDICTION OF INTER-STATE COMMISSION: STANDING TO TAKE ACTION

Key Legislation

CONSTITUTION, s. 92: INTER-STATE COMMISSION ACT 1912, s. 21

Date
Client
The Comptroller-General of Customs

The Comptroller-General of Customs forwards papers for advice as to whether the differential scale of wharfage charges imposed by the Melbourne Harbor Trust Commissioners is in contravention of the Constitution, adding: 'Should the opinion be in the affirmative, it is presumed that it will be necessary for action to be taken by those who may be adversely affected by the scale'.

The facts are stated in the following memorandum to the Comptroller-General of Customs by the Chief Clerk:

In August 1903 the Attorney-General was asked-

  1. Whether the action of a Victorian Marine Board in charging wharfage against Tasmanian produce and not against Victorian produce is lawful.
  2. If not, what steps if any should be taken in the matter and by whom.

In reply he advised as under (17-8-03)(1):

In my opinion, a wharfage rate imposed by a State authority in respect of produce from other States, and not imposed in respect of the domestic produce of the State, is in violation of section 92 of the Constitution, which declares that trade, commerce, and intercourse among the States, whether by means of internal carriage or ocean navigation, shall be absolutely free. Such a rate places interstate trade at a disadvantage compared with domestic trade.

It is for some person prejudiced by the rate to take action.

When the Inter-State Commission Bill is passed, further remedies will probably be available, and also more effective machinery; and it will be possible to deal with such matters as this, not only as a breach of interstate free trade, but also as a discrimination forbidden by Commonwealth law.

Under date 3rd instant Henry Berry & Co. Ltd have written as follows:

The new schedule of wharfage rates issued by the Melbourne Harbor Trust and operative from 1st inst. provides for varying rates on the same classes of goods. The regulation under which the Schedule is issued appears to be No. 311 which reads:

There shall be paid to the Commissioners in respect of all goods landed from any vessel within the Port, unless exempted by any Act of Parliament or these Regulations, the rates specified in the Schedule to this Regulation, provided-

  1. That the goods which have been produced or manufactured within the Commonwealth, and which arrive at this Port from any Port in the Commonwealth, shall pay only 50 per cent of the rates specified.
  2. That goods arriving from any place within Port Phillip Heads shall pay only 25 per cent of the rates specified.

This appears to us to be illegal and a similar regulation was, we understand, rendered void by your Department taking action some years ago.

The effect is an interference with the fiscal system of the Commonwealth. Under this regulation there is not only an extra rate charged on oversea goods but also an extra rate levied on goods brought from other States compared to those levied on goods produced in Victoria and brought from say Geelong to Melbourne.

Will you kindly look into the matter and see what action is necessary.

Reference is also made to the matter by the Chairman, The Castle Salt Co-operative Co. Ltd, Adelaide, in letter herein dated 4 January.

In view of the fact that the Inter-State Commission Bill has become law since the date of the previous opinion on the matter, the favour of advice is requested as to the present position.

It is not known whether the recent decisions of the High Court in regard to the scope of section 92 of the Commonwealth Constitution have affected the position in any way.

It is submitted that the papers be referred to the Attorney-General's Department for favour of advice.

In my opinion, the discrimination as regards charges between goods from places within Port Phillip Heads and goods from elsewhere in the Commonwealth is in contravention of section 92 of the Constitution. I do not think that the recent decisions of the High Court in the Wheat(2) and Meat(3) cases have affected the position in this respect.

I think that the rate is also in contravention of section 21 of the Inter-State Commission Act, and as such could be challenged in a court of law.

In view of the High Court's decision in the Wheat case, however, the Inter-State Commission has no jurisdiction to deal with the case.

I agree that it is for persons aggrieved by the discrimination to take action.

[Vol. 15, p. 20]

(1)Opinion no. 148

(2)New South Wales v. Commanwelth 20 C.L.R.54

(3)Duncan V. Queensland 22.C.L.R.556.