HIGH COURT OF AUSTRALIA

                                              In Re Ex Parte McLean.

                                    (Isaacs C.J., Rich, Starke and Dixon JJ.)

                                                     6 June 1930

Isaacs C.J. and Starke J.

On 6th November 1929 Hammond A.J. granted an order nisi for a common law writ of prohibition
to restrain further proceeding upon a conviction of James McLean by the respondent, George
Sydney Goldie, a Police Magistrate.

McLean was prosecuted under State law by Frederick Firth, his former employer, the offence being
thus described in the information: "That on the nineteenth day of September 1929 one J. McLean a
shearer being a servant as defined by the Masters and Servants Act 1902 having contracted with
Frederick Firth to perform for him as such servant a certain work to wit shearing at Lockslea near
Warren and having commenced such work did neglect to fulfil such contract." At the hearing before
the Police Magistrate, the applicant's solicitor asked for particulars as to what was relied on as
constituting the offence, and he was informed that they were these: "In injuring the sheep and failing
to notify the employer that he had injured them, in leaving the employment without permission, and
in shearing the sheep badly and leaving two inches of wool on them." It was objected that the Court
had no jurisdiction since the State Act was inconsistent with relevant Commonwealth legislation.
The Magistrate overruled the objection and convicted the present applicant, who was fined £2, with
costs 8s., and professional costs £3 3s., witnesses' expenses £1 16s., in default of payment within
twenty-one days, twenty-one days' imprisonment with hard labour.

The order nisi was returned before the Supreme Court on 19th February 1930, but that Court,
considering the matter one within sec. 40A of the Judiciary Act, proceeded no further, and directed
the Prothonotary to forward the papers to the Registrar of this Court.

The case seems to fall rather within the overlapping legislation met by sec. 109 of the Constitution
than within that of passing the frontier line of power. But for precaution sake learned counsel on
both sides assented, by application of one and consent of the other, to the removal of the cause into
this Court under sec. 40 of the Judiciary Act. The Court reserved its decision as to that step, and
heard argument on the main question of the prohibition. In the circumstances, it is expedient to
make an order removing the cause under sec. 40.

The conviction of McLean, it will be seen, was for "neglect to fulfil" his contract, the neglect
consisting of (1) injury to sheep, (2) failure to notify the employer of such injury, (3) leaving
without permission, and (4) badly shearing sheep. The conviction and punishment was for all four
causes so far as appears, and these are inseparable. So that even if, as argued by Mr. Windeyer, the
third item of "neglect" were within the State jurisdiction, it would not save the matter from
prohibition, since the other items are clearly outside that jurisdiction. But, in truth, the third item is
no less covered by sec. 109 than the other three. The contract itself was one prescribed by Federal
law and not by State law. That is, by an award of the Commonwealth Court of Conciliation and
Arbitration, which was at all material times in force, beginning 15th September 1927, it was
prescribed (clause 2) that, as to shearing, before any member of the Australian Workers' Union (of
which McLean was a member) should be employed, a written agreement in the form of schedule A
should be signed by the member and by his employer. The agreement which the applicant was
punished for neglect to fulfil was in accordance with the requirement of schedule A of the award.
Clause 32 of the award is as follows: "The employers bound by the award and their servants and
agents respectively shall observe and perform the conditions of the award, and of the agreements in
schedule A thereof." Clause 33 prescribes: "The Union and its members shall observe and perform
the conditions of this award and of the agreements in schedule A thereof." The contract entered into
is headed "Shearer's Agreement. In accordance with the award of the Commonwealth Court of
Conciliation and Arbitration dated 14th September 1927."

It is to be noted in limine that not only the obligation to make the agreement, but the obligation to
observe it, is prescribed by the award. The award itself is, of course, not law, it is a factum merely.
But once it is completely made, its provisions are by the terms of the Act itself brought into force as
part of the law of the Commonwealth. In effect, the statute enacts by the prescribed constitutional
method the provisions contained in the award. When those provisions are examined, it is seen that
they deal completely with the area of industrial relations covered by them. The intention is clear that
the requirement of a contract, its form and its obligations, and the consequences of its breach, shall
be governed by the Commonwealth law. If that is so, it necessarily follows that any alteration of the
Commonwealth provisions of adjustment by State law, whatever be the scope or purpose of that law,
must be inconsistent with the enactment of the Federal law.

In Cowburn's Case[1] is stated the reasoning for that conclusion, and we will now refer to those
statements without repeating them. In short, the very same conduct by the same persons is dealt with
in conflicting terms by the Commonwealth and State Acts. A Court, seeing that, has no authority to
inquire further, or to seek to ascertain the scope or bearing of the State Act. It must simply apply
sec. 109 of the Constitution, which declares the invalidity pro tanto of the State Act. In Canada,
where no section corresponding to sec. 109 of the Constitution exists, but where, by reason of
exclusive fields of legislation, conflicts may arise between the national and the provincial
legislation, the Privy Council have enunciated a rule which in practical effect corresponds with sec.
109 of the Australian Constitution. In Attorney-General of Ontario v. Attorney-General for the
Dominion of Canada[2] Lord Herschell L.C. said that a Dominion bankruptcy law regulating
voluntary assignments would exclude provincial legislation on the same subject under the power to
make laws in relation to property and civil rights in the Province. Similarly, in Tennant v. Union
Bank of Canada[3]. And again in Grand Trunk Railway of Canada v. Attorney-General of
Canada[4], where Lord Dunedin says the true question is whether the Dominion legislation is
within its powers. If it is, it matters not that the provincial legislation which conflicts is in relation to
a different class of legislation which is within the State legislative power.

In the present circumstances, the conviction was not authorized by any valid law, and the order for
prohibition should be made absolute.

Rich J.

I have read the judgment of my brother Dixon and agree with it. The Commonwealth Conciliation
and Arbitration Act confers upon the tribunal a power, and the award embodies the exercise of that
power. Just as in the case of powers and authorities in other branches of the law it reposes in the
donee of the power a particular discretion in this case to ascertain and determine what shall be a
proper industrial relationship in respect to matters in dispute. And as in the case of other powers the
efficacy and legal result of the exercise of the discretion is derived wholly from the instrument
creating the power to which the exercise is referred and attributed. In the law of real property "the
title is derived immediately from the authority, and from the person by whom that authority was
delegated" (Preston's Essay on Abstracts of Title, 2nd ed., vol. ii., p. 257). Upon this reasoning it
appears to be a necessary conclusion that if the Act means, as I think we have already held it does
mean, to confer upon the tribunal an authority to determine what shall be the exclusive rights and
duties of the disputants in respect of matters in dispute, then any State law is inconsistent with the
Act which creates that power when the power is exercised if that State law deals with the same
subject matter and purports to prescribe rights and duties of the same order.

Although I have reached this conclusion, the view that a law of a State which punishes a particular
dereliction of duty becomes ineffectual because an award imposes the same or a similar duty strikes
me as a very extreme result of the interpretation of the Commonwealth Conciliation and Arbitration
Act which we have adopted in this Court.

As no offence was committed against State law by the applicant, the order nisi for prohibition must
be made absolute.

Dixon J.

The applicant was employed by the respondent as a shearer. Both were bound by an award of the
Commonwealth Court of Conciliation and Arbitration. That award provided that, before a person to
whom it applied was employed in shearing, a written agreement should be signed by him and his
employer embodying terms and conditions which were set forth in a schedule. The award further
provided that employees to whom it applied should observe and perform the conditions of the award
and of the agreement. The applicant and the respondent signed a written agreement in the form thus
prescribed.

During the course of shearing the respondent complained that the applicant was shearing the sheep
improperly, and was injuring them, and told him that if he would not shear as he ought "he had
better put his machine in." The applicant ceased shearing, and the respondent laid an information
against him under sec. 4 of the New South Wales Masters and Servants Act 1902 for that being a
servant as defined by that Act, having contracted to perform for the respondent as such servant
certain work, to wit, shearing, and having commenced such work he did neglect to fulfil such
contract. Upon this information the applicant was convicted. Sec. 4, under which he was convicted,
is as follows: "Any servant who contracts with any person to serve him for any time or in any
manner, or to perform for him as such servant a certain work at a certain price, and does not enter
into his service or commence his work according to his contract, such contract being in writing and
signed by the parties thereto, or any servant having entered into such service or commenced such
work who absents himself therefrom, without reasonable cause, before the term of his contract has
expired or before the work contracted for is completed, whether such contract is in writing or not, or
neglects to fulfil the same, or is guilty of any other misconduct or ill behaviour in the execution
thereof, shall be liable to a penalty not exceeding ten pounds or in lieu thereof, at the discretion of
the convicting justices, shall forfeit the whole or such part of the wages then due, as the justices
shall think fit."

The applicant appealed against his conviction to the Supreme Court of New South Wales by way of
statutory prohibition upon grounds which were intended to raise the question whether this provision
had any valid operation in the case of the applicant inasmuch as his neglect to fulfil his contract
would amount to a breach of the Federal award punishable under the Commonwealth Conciliation
and Arbitration Act 1904-1928. Upon the return of the order nisi for statutory prohibition the
Supreme Court considered that the matter involved a question as to the limits inter se of the
constitutional powers of the State and Commonwealth which, by reason of sec. 38A of the Judiciary
Act 1903-1927, they had no jurisdiction to entertain or determine, and in pursuance of sec. 40A they
proceeded no further in the cause which was treated as removed to this Court.

The question raised is whether a State law is inconsistent with a Commonwealth law and therefore
invalid by reason of sec 109 of the Constitution. This is not a question as to the limits inter se of the
constitutional powers of the Commonwealth and of the State. But the question turns upon sec. 109
of the Constitution, and for this reason the matter is a cause arising under the Constitution or
involving its interpretation, which may be removed into this Court pursuant to sec. 40 of the
Judiciary Act 1903-1927. An application was made on the part of the applicant that the cause should
be so removed and, in the special circumstances attending this litigation, the application is to be
granted. The question of substance was fully argued before us and, the cause having been removed,
there is no reason why it should not be determined at once without further argument.

Sec. 44 of the Commonwealth Conciliation and Arbitration Act 1904-1928 penalizes any breach or
non-observance of an award, and, inasmuch as the award in this case commanded performance of
the applicant's contract, his neglect to fulfil it would constitute an offence under this provision. The
same acts or omissions were therefore made subject to the penal sanctions of the Federal enactment
and the somewhat different penal sanctions of the State enactment.

When the Parliament of the Commonwealth and the Parliament of a State each legislate upon the
same subject and prescribe what the rule of conduct shall be, they make laws which are inconsistent,
notwithstanding that the rule of conduct is identical which each prescribes, and sec. 109 applies.
That this is so is settled, at least when the sanctions they impose are diverse (Hume v. Palmer[5]).
But the reason is that, by prescribing the rule to be observed, the Federal statute shows an intention
to cover the subject matter and provide what the law upon it shall be. If it appeared that the Federal
law was intended to be supplementary to or cumulative upon State law, then no inconsistency would
be exhibited in imposing the same duties or in inflicting different penalties. The inconsistency does
not lie in the mere coexistence of two laws which are susceptible of simultaneous obedience. It
depends upon the intention of the paramount Legislature to express by its enactment, completely,
exhaustively, or exclusively, what shall be the law governing the particular conduct or matter to
which its attention is directed. When a Federal statute discloses such an intention, it is inconsistent
with it for the law of a State to govern the same conduct or matter. But in the present case, conduct
which the State law prescribes, namely, the performance of contracts of service, is a matter with
which the Commonwealth Parliament has not itself attempted to deal. Although neglect by a shearer
to perform such a contract constitutes an offence against Federal law, this does not arise from any
statement by the Federal Legislature of what the law shall be upon that subject. The conduct which
the Federal statute penalizes is the breach of industrial awards. There is no collision between an
intention to deal exclusively with disobedience of awards and a law for the punishment of breach of
contract. The Federal instrument, which prescribes performance of the shearers' contract of service,
is the award of the Commonwealth Court of Conciliation and Arbitration. But unlawful as it is to
depart from the course which such an instrument describes and requires, the instrument itself is,
nevertheless, not "a law of the Commonwealth" within the meaning of those words in sec. 109. Sec.
109 cannot, therefore, operate directly upon it so as to render a State law invalid because it is
inconsistent with the intentions which the arbitrator expresses in the award. But these considerations
do not end the matter. They do establish that if State law is superseded it must be upon the ground
that the State law thereupon becomes inconsistent with the meaning and effect of the
Commonwealth Conciliation and Arbitration Act itself. But the provisions of that Act itself, which
establish awards made under its authority, may have a meaning and effect consistently with which
State law could not further affect a matter for which such an award completely provides. If the Act
means not only to give the determinations of the arbitrator binding force between the disputants but
to enable him to prescribe completely or exhaustively what upon any subject in dispute shall be their
industrial relations, then sec. 109 would operate to give paramountcy to these provisions of the
statute, unless they were ultra vires, and they in turn would give to the award an exclusive operation
which might appear equivalent almost to paramountcy.

Close consideration of the reasons given by Isaacs, Rich and Starke JJ. in Clyde Engineering Co.
Ltd. v. Cowburn[6] shows that the view upon which they acted in that case and applied afterwards in
H. V. McKay Pty. Ltd. v. Hunt[7] was substantially that the Constitution empowered the Parliament
to give and that Parliament had given the award this exclusive authority. The view there taken, when
analyzed, appears to consist of the following steps, namely: (i.) The power of the Parliament to
make laws with respect to conciliation and arbitration for the prevention and settlement of industrial
disputes extending beyond the limits of any one State enables the Parliament to authorize awards
which, in establishing the relations of the disputants, disregard the provisions and the policy of the
State law; (ii.) the Commonwealth Conciliation and Arbitration Act confers such a power upon the
tribunal, which may therefore settle the rights and duties of the parties to a dispute in disregard of
those prescribed by State law, which thereupon are superseded; (iii.) sec. 109 gives paramountcy to
the Federal statute so empowering the tribunal, with the result that State law cannot validly operate
where the tribunal has exercised its authority to determine a dispute in disregard of the State
regulation.

The distinction between this doctrine and one which gives to sec. 109 a direct application to Federal
awards is probably not confined to the mode of reasoning by which the conclusion is reached. It
may well be that the distinction extends to the results produced. If a Federal statute forbids a
particular act or omission and means to state what shall be the law upon that specific matter, any
State law which dealt with the same act or omission would become inoperative, and it would
probably be of no importance whether each Legislature was directing its attention to the same
general topic or had dealt with the same act or omission in the process of legislating upon two
entirely different subjects. For instance, sec. 4 of the New South Wales Masters and Servants Act,
assuming it otherwise to apply to him, would doubtless be superseded in relation to an officer
governed by the Commonwealth Census and Statistics Act 1905-1920 who wilfully neglected to
fulfil the duties of his office, because sec. 22 of that Act penalizes such conduct although in the
process of dealing with a very different subject. On the other hand, the Commonwealth Conciliation
and Arbitration Act in giving force and effect to awards necessarily confines their exclusive
authority to the regulation of industrial relations and, moreover, to the regulation of industrial
relations which are in dispute. It may perhaps follow from this rule that, while the arbitrator can
make his award the exclusive measure of industrial rights and duties between the disputants, the
laws of a State which do not regulate industry at all are not inconsistent with the exclusive authority
which the Commonwealth statute gives to the award merely because they deal with specific conduct
which, as between the disputants, is dealt with by the award. For example, if the award in this case
expressly forbad shearers to injure sheep when shearing, it would not be a necessary consequence
that a shearer who unlawfully and maliciously wounded a sheep he was shearing could not be
prosecuted under the State criminal law for unlawfully and maliciously wounding an animal. It is
not, however, necessary to determine whether this distinction in the application of the doctrine is
valid. It may be assumed that provisions of State law which prohibit acts or omissions irrespective
of the relation of employer and employed, and without regard to any other industrial relation or
matter, are not superseded under sec. 109 merely because it happens that in their industrial aspect
the same acts or omissions by parties to a dispute are forbidden by Federal award and by this means
made punishable under the Federal statute. But, in this case, the State law, sec. 4 of the Masters and
Servants Act 1902, deals directly with the relation of employer and employed, and in virtue of that
industrial relation makes penal the very default which the Federal law punishes somewhat
differently in the regulation of the same relation.

The case, therefore, is not one in which conduct made punishable by State law on grounds which do
not affect industrial relations is forbidden by an award as a regulation of industry, and thus brought
also within the penalties of the Commonwealth Conciliation and Arbitration Act.

It may be objected that the present case does not fall within the doctrine which ascribes such
efficacy to an award because the Federal tribunal has not made an award in disregard of State law
but, so far as material, has in effect forbidden the very neglect to perform a contract of service
which State law punishes; and that it does not fall within the description of inconsistency illustrated
by Hume v. Palmer[8] because there the respective Legislatures had each directed its attention to the
same subject and both had themselves prescribed the rule upon it, while here the Commonwealth
Parliament directed its attention to disobedience of awards and the State Legislature dealt only with
the breach of contracts. But the substance of what the Federal award did in this case was to
command performance of the prescribed contract as an industrial duty proper to be imposed and
enforced by Federal law according to the sanctions which it provides, while the State law required
performance of the same contract as an industrial duty proper to be imposed and enforced by its
authority and according to its sanctions. According to the doctrine deduced from the judgments of
the majority of the Court in the cases of Clyde Engineering Co. v. Cowburn[9] and H. V. McKay Pty.
Ltd. v. Hunt[10], the Commonwealth Conciliation and Arbitration Act gives full and complete
efficacy and exclusive authority to this regulation of the Federal tribunal, and sec. 109 makes this
statute prevail.

In these conditions, in so far as it affects persons bound by the award, sec. 4 of the Masters and
Servants Act 1902 is inconsistent with the provisions of the Federal statute and, by virtue of sec. 109
of the Constitution, the latter must prevail, and the former to the extent of the inconsistency is
invalid. Accordingly no offence was committed against State law by the applicant, and the order nisi
for prohibition must be made absolute.

Rule nisi made absolute.

Solicitor for the applicant, A. C. Roberts.

Solicitors for the respondents, McLachlan, Westgarth & Co.

[1] (1926) 37 C.L.R., at pp. 489 et seqq., 524.

[2] (1894) A.C. 189.

[3] (1894) A.C. 31, at p. 47.

[4] (1907) A.C. 65, at p. 68.

[5] [1926] HCA 50; (1926) 38 C.L.R. 441.
[6] [1926] HCA 6; (1926) 37 C.L.R. 466.
[7] [1926] HCA 36; (1926) 38 C.L.R. 308.
[8] [1926] HCA 50; (1926) 38 C.L.R. 441.
[9] [1926] HCA 6; (1926) 37 C.L.R. 466.
[10] [1926] HCA 36; (1926) 38 C.L.R. 308.

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