Castlemaine Tooheys Limited & Ors v The State of South Australia

[1989] HCATrans 120

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IN THE HIGH COURT OF AUSTRALIA

Registry No C14 of 1986

B e t w e e n -

CASTLEMAINE TOOHEYS LIMITED

First Plaintiff

TOOHEYS LIMITED

Second Plaintiff

THE SWAN BREWERY COM:PANY LIMITED

Third Plaintiff

BOND BREWING (VIC) PTY LIMITED

Fourth Plaintiff

PARADE LIQUOR PTY LIMITED

Fifth Plaintiff

ONRUTAS PTY LIMITED

Sixth Plaintiff

SATURNO'S NORWOOD HOTEL PTY LIMITED

Seventh Plaintiff

SATURNO INVESTMENTS PTY LIMITED

Castlemaine(2)

Eighth Plaintiff

and

THE STATE OF SOUTH AUSTRALIA

Defendant

Special Case

Cl'I2/l/DR - 104 31/5/89

MASON CJ
BRENNAN J
DEANE J

DAWSON J

TOOHEY J

GAUDRON J

McHUGH J

TRANSCRIPT OF PROCEEDINGS

AT CANBERRA ON WEDNESDAY, 31 MAY 1989, AT 10.17 AM

(Continued from 30/5/89)

Copyright in the High Court of Australia

MASON CJ: Yes, Mr Solicitor.

MR DOYLE:	If the Court pleases, Your Honour Justice Brennan
inquired yesterday as to the number of containers
in the market.  We are trying to get some
instructions this morning. We believe that the beer market in South Australia is a 100 million
containers approximately per annum and that,
therefore, the 4 per cent represents 4 million
containers per annum, but we hope to get accurate
instructions on that during the course of the
morning.

Your Honours, at the adiourn~~nt~ I had

been dealing with the 1975 Act and returning co
paragraph 9 of the submissions on the facts, in

our submission the Act can be seen as having

done two things: one which I have put there,

discouraging the use of non-refillable containers

and the other, which is really part and parcel

of tha4 although a separate object, promoting litter
control.

(Continued on page 106)

ClT2/2/DR -	105	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And, in our submission, it is

important to bear in mind that this Act was not

concerned only with beer containers - it has

to be put in context, it dealt with containers

with non-refillable bottles, it was also concerned	for other beverages but was not concerned just
with cans. As to the mechanism for discouraging
non-refillable containers, the first one was
the higher deposits an4 subparagraph (a), a
five cent deposit was imposed, in effect, by
the legislation and the regulations. Prior to
that there was no deposit at all for soft drink
cans or beer cans and, again, in putting this Act in context, it is important, in our submission, to bear in mind that it dealt with both types of cans.
As to the bottles, in 1975, the voluntary deposit level for the refillable bottles was
15 cents per dozen, or just over a cent per container
and when the Act came into force and 375 ml bottles were being used by South Australian Brewing,
the deposit level for them was 12 cents per dozen
at that time, and the deposit level imposed by
combination of the Act and regulations on
non-refillable bottles was 60 cents.

So it can be said that broadly, what the

Act and regulations did was to produce a situation in which non-refillable bottles carried a return rate of 60 cents per dozen and bottles under

the voluntary return system were carrying a deposit

of 12 cents or 15 cents per dozen, depending
on the size of the bottle.

I thought my friend, at one stage, said yesterday that prior to the Act there was no

deposit at all for the refillable bottles. If

he said that then, in our submission, that is

not correct; there was, in fact, one and a bit

cents per bottle for the big bottles and so it

is not correct to say it was zero.

The other way in which non-refillable containers

were discouraged - and it is, really, again,

part of what I have already said, is that the

refillable bottles were exempted from the system

and so those lower voluntary deposits were able

to be used and that flowed from the definition

of exempt container and then the actual exemption

of the containers.

C 1 T3 / 1 /ND - 106 31/5/89

Castlemaine(2)

MR DOYLE (continuing): That lower deposit at that time was

sufficient to achieve a good return rate. That also

was established by the paragraphs referred to in the

special case.

The second way in which non-refillable containers

were discouraged was the requirement to refund the

deposit at the point of sale. In our respectful

submission my friend perhaps put this one a little

too highly. We do not deny that retailers of

liquor were discouraged from handling such

containers by the requirement to refund the deposit.

But we do make the point, which we make in

subparagraph (a) under that heading, that this was

the very system that was being used and had been used

for many years for soft drink containers, and so unless

there is something peculiar- which we would suggest is

not common sense about people who sell liquor - it is

not as if it is a system which is inherently difficult

for liquor retailers to meet. People who sell soft

drinks in shops which one would think· some of which

are similar, some are a bit different, but soft
drink retailers are able to accommodate the requirement
to refund deposits at the point of sale, and so

there is nothing inherent about the selling of

liquor which means that this is in itself a burden.

Presumably they have got out of the habit of

doing it, or are not used to doing it for non-refillable

containers, but it is not something which, in our

submission, should be approached by the Court as if it

were a special burden for liquor retailers. So there

were the two means taken really to discourage

non-refillable containers, the higher deposit and,

we would submit, the significantly lesser discouragement

provided by the point of sale refund requirement.

When one goes then, as one should in our submission,

to the question of what were the objects of the

legislation - perhaps I could go straight to

paragraph 11 and omit paragraph 10, which was really

repetitive - we submit that when you look at this

legislation in its context it can be seen as having

the objects which we suggest, and one can fairly call

them the objects of the Act.

(Continued on page 108)

ClT4/l/FK -	107	31/5/89<
Castlemaine(2)

MR DOYLE (continuing): Litter control by forcing non-glass

containers and non-refillable containers into a

return system, which to work obviously had to

provide both places where they could be returned,

and they would be either collection depots or the

point of sale, and an incentive to return, which

was regaining the deposit. So we submit that

emerges quite clearly as one object of the

legislation.

The other object which we submit emerges

quite clearly was energy and resource conservation,

simply by discouraging the use of non-refillable

containers by putting them at a competitive

disadvantage and the added discouragement to the extent it was, of requiring the liquor retailers to handle the bottles. And we do submit that

the Court can conclude that these were the objects

of the legislation and harking back to the point

which Your Honour Justice Deane raised with my

learned friend yesterday, it is not positively

asserted in the case that is so. In our submission

this is really an issue of law and one which would

not appropriately be asserted as something akin to

a fact in this special case.

And we submit the Court can and should, in

considering what is the mischief, have regard to
the second reading speach of the minister when
the legislation was introduced, simply to identify

the problems at which it was aimed. And if I

could go to that very briefly, in the book of parliamentary debates which were provided to

Your Honours, at page 1- sorry these are numbered

so faintly, but it is the very first page. These

are in fact the debates on the 1974 bill, but it

was introduced in identical terms in 1975, not

having got through the house, so for convenience

I simply go to the 1974 debates, and simply to

identify the problems at which the legislation

was aimed, the minister says at the bottom of the

column on the left-hand side:  (Continued on page 109)

CITS/1/CM	108	31/5/89
Castlemaine(2)
MR DOYLE (continuing):

The principles on which it is based are

not new.

I take him to be referring to the points I made

yesterday that this return system is well !mown in

the State. Then, he goes on to say this system

has:

not included so-called convenience beverage

containers, those cans and non-reusable

containers that so disfigure our rural and

urban environment.

So, presumably, referring there to the litter aspect.

He goes on, in the right-hand column, to refer to

similar legislation overseas. At about the middle

of the right-hand column, he refers to complaints

about litter and in almost the middle of the second
paragraph in that column, says:

Most of the complaints received referred to increasing litter due to non-returnable

beverage containers, a problem which is
particularly obvious in coastal and other

areas -

Then, just below that:

It must not be forgotten that non-returnable

containers in this State are taking over an

increasing share of the market.

And that is borne out by the facts before Your Honours.

At present they represent about one-quarter of

all soft drink sales and the potential ..... is of

course four times that. The problem at present

is great and disturbing, with about 100,000,000

cans sold each year in South Australia.

Then he says:	If all sales in returnable bottles disappear,.
the existing system of deposit and return would
also disappear -

and that harks back to the point I made yesterday which

is also in the special cas~, that the system to work

requires a certain throughput:

so losing a long-established recycling system

at a time when so much thought is being given to

ways in which further such systems can be established

for all kinds of material.

ClT6/l/SH	109	31/5/89
Castlemaine(2)

Of importance in the Government's

initial detailed thinking were other problems

that could arise or had arisen, such as the

cost of and sites for garbage disposal .....

res9urce use and the possibility of establishing

a viable system of recycling. Thus, litter

control is only one aspect of what the

Government has always seen as part of a much

bigger problem.

(Continued on page 111)

ClT6/2/SH	110	31/5/89
Castlemaine_( 2)

MR DOYLE (continuing): And then, over the page, just below

the mid-point of the left-hand column, that is

in page 2, he says:

The amount of this refund value will be

determined by regulation to ensure that

flexibility of implementation so necessary

in a period of rapidly escalating costs,
but initially the level of a minimum refund

value will be 5¢ on cans, non-reusable glass

containers, including stubbies, and soft

drink bottles, and 1¢ on reusable beer bottles.

Pointing, clearly, there to the intention which

was fulfilled of establishing a differential.

So, our submission is that it emerges quite clearly

that they were the objects of the 1975 legislation

and one can fairly, therefore, categorize the

legislation in those terms. I do so by a combination

of referring to the debate to identify a problem

aimed at and in looking at what the law does

on its terms once one understands it in its factual

context.

In relation to that I would also make the

point which we make in paragraph 12 that it is

not suggested that the South Australian system

is the only means of controlling litter; we

simply make the submission that it is obviously

an effective means and, again, when one puts

this legislation in context one should not approach

it in any sense with a feeling or an attitude

that it has been selected as a means because

it disadvantages interstate traders. In our

submission, what the facts show is that it is

at least as good as any other system and it was

entirely understandable that the Parliament should

use it as it was in existence in the State.

Could I just go, very briefly, to paragraph 31

of the special case on that point. I do not

want to get into an argument because, on our

argument, it is not really relevant as to whose

system is better, but just make the point and

reinforce it that the return rate for Pickaxe

brand bottles is 92.6 per cent for the big bottles

and 82.4 per cent for the small bottles.

Your Honours will see that for soft drink containers

even higher rates of return are achieved. As

the special case says, it is impossible to make

direct comparisons between litter statistics

and I certainly would not want to be taken as

suggesting that for New South Wales the rate

is 43 per cent, for instance, because, as it

goes on to indicate, other containers are being

regained, as it were, throughrubbish bins but,

of course, then, just go into the litter stream

whereas the South Austraian system is directed

C1T7/l/SDL	1 1 1	31/5/89
Castlemaine(2)

not just as getting them back but getting them

back in a system which will enable the container

itself to be reused, so it does have a further

objective.

But there may be some significance in the

fact, over the page, that in New South Wales

beverage containers have increased from 9 per
cent of litter in 1978 to 19 per cent whereas,
in South Australia, they have reduced from

14 per cent to 8 per cent.

Our basic point on this is that the system

is obviously a satisfactory one. There may be

other systems but we would submit that in no
sense can it be said that the Parliament here

has, as it were, gratuitously selected a system

such that one would even begin to think or suspect

that the system was selected with some ulterior

motive.

DEANE J:  Mr Solicitor, are there figures on the different

costs of reusable glass containers and non-reusable

in the State?

MR DOYLE:  Yes, Your Honour. There are figures there

which were touched on yesterday and the figures

were for beer bottles. 16 cents and 16.65 -

paragraph 69. It is perhaps not a model of clarity

of expression but, in my submission, what it

means is that when you sell a non-refillable

bottle of beer, 16 cents is the cost of the container,

of the bottle, and if it is a refillable bottle

it is 16.65 cents.

(Continued on page 113)

C1T7/2/SDL	1 1 2	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  So each time you use a refillable bottle

the bottle is costing you 16.65 cent~ each time you

use a non-refillable bottle the bottle is costing you
16 cents. It may seem surprising at first that a

refillable bottle is used a number of times but still

finishes up per use costing a bit more, but of course

each time it is used there are the costs of recovering

it, washing it and getting it back into the system

and those handling costs are not insignificant.

DEANE J:	That means, does it not, that for purposes of encouraging returns, and simply from the litter factor,
two cents on a non-refillable bottle would be more onerous than one cent on a refillable, when you take
the cost factor involved.  that is, if it is not to
the advantage of the manufacturer to get it back, or ishe f creed to take it back?

MR DOYLE: Yes, Your Honour. Yes, I think, with respect, that

is right. We certainly acknowledge that if the only

concern is litter control it would be difficult to

justify a differential in deposits because, as long

as there is a system for getting the bottles back -

say point of sale or collection depots:if,for instance,

five cents or four cents will bring back a refillable

container then as long as there is a system it should

also bring back a non-refillable container.

DEANE J:	Well, that is not quite right is it? Because if you
load the system to produce not only the incentive in the customer but a desire of the manufacturer to
get it back - no, what I am putting is wrong. Yes, what you
say is right .  ·
MR DOYLE:	Yes, that any return system really hinges on the consumer, the person who buys the drink, having a
place where he can conveniently take it and then
secondly, there being a sufficient financial
incentive for him to do it.
DEANE J:	What I was suggesting is right, I think, and that is
bottle back than he is to get a refillable bottle, is going to be less keen to get a non-refillable some loading is justified because the manufacturer
once his manufacturing process has been geared to
reusing.  But it would seem that the one cent would
take account of the difference there once you look at these different figures.
MR DOYLE:	Yes, Your Honour.  I am not sure if it helps
my argument or not but, in our submission, as long
as the system is there, in a sense the producer's
or manufacturer's attitude to getting his bottle back
does not matter too much.  If you set up a system
so that there are places where people can take the bottles and an incentive to them to take them there
then, whatever the manufacturer thinks about it,
they will come back to those places.

ClT8/1/DR	113	31/5/89
Castlemaine(2)

It may be, and it maybe this is what Your Honour

is getting at, tha~ depending on the type of container

you are using, if there is the same deposit level for

refillables and non-refillables, one particular

producer may be slightly better off because, as it

were, he is getting value out of his bottles. If

that is what Your Honour is getting at, yes,I agree

with that and so it

perhaps cannot be taken any further in that sense

that the users of the different types of bottle could

be in a slightly different position.

BRENNAN J:  I suppose, realistically, the object must be to

provide a commercial incentive for getting the

bottles back because, otherwise, one imagines that

the contacts between the producer and the person ~t

the point of sale are such as where the producer

has an incentive to get them back the point of sale

people will perform their functions with more

alacrity.

(Continued on page 115)

C1T8/2/DR	114	31/5/89
Castlemaine(2)

MR DOYLE:  Yes, Your Honour, I would not, with respect,

disagree with that.

DEANE J:	But the problem with that is that the higher
deposit you require the more completely you destroy
any incentive to get them back because the
manufacturer or the producer has received the
deposit and the higher the deposit the less
desire on his part to pay it back for something
that is not worth anything like the value of
it.
MR DOYLE:	Yes, although, Your Honour, there is nothing

in the facts which suggest that producers, in

effect, see a profit through collecting deposits

and then bottles never coming back to them.

That must occur to some extent because some bottles,

obviously, just finish up in the rubbish or litter

stream but, presumably - although I am not sure the facts really spell this out - once you have

made a bottle it is basically in your interests,

if it is a refillable to refill it and use it

four or five times rather than making a new bottle

to replace it. The cost of the new bottle, first

time around, will be more than the 16.65 cents

to refill it per occasion of refilling and

obviously these figures cannot be precise because

no one can say that a refillable bottle will

always be refilled four times or five times but

if one postulated that on average they were refilled

about four times, what it means is that, in all,

it has cost you around about four times 16.65

cents to produce that bottle and get it back three times, which suggests that the initial production cost of the bottle, first time around,

is not insignificant.

DEANE J: No, but the obvious fact is that if you altered

your law to say that everybody had to take a

deposit of 15 cents per bottle but that one

manufacturer did not have to take any of them

back, he would be infinitely better off than

those who were required to take them back and

pay 15 cents for the bottle. Otherwise we would

not be here, surely.

MR DOYLE:  Yes, Mr Selway says to me, Your Honours, that

that would seem to be right and has indicated

by the further paragraphs which relate to the

costs for Bond Brewing, if they were to establish,

as it were, a handling system to get bottles

back, and that is the latter part of paragraph 72,

that there obviously is a cost in handling the

bottles and getting them back each time.

C 1 T9 / 1 /ND -

1 1 5 31/5/89

Castlemaine(2)

So, Your Honours, as to litter control and

resource conservation, I have made the submission

in paragraph 12 that the system was a natural
one to adopt and we submit that, obviously, the

Court can proceed on the basis that this is a

desirable objective and we submit the same thing

in relation to conservation of energy, that the

Court can proceed on the basis that that is a

desirable objective and it is our submission

that it is not the function of the Court to try

to quantify that and then say, "Well, now is

it better, really, to wash bottles and use a

bit more water or better just to use the bottle
once and, in effect, throw away whatever it takes

to make the bottle but not use the water to wash

i t ? II

In our submission, the relevant thing is

that in a general sense the conservation of the
energy and resources is widely regarded as a

desirable objective.

DEANE J:	I will stop interrupting after this, Mr Solicitor,
but is not your problem this, that reading the
stated case, it is almost impossible to avoid
the impression that all that was involved here
was the litter aspect and that conservation of
energy and carbon dioxide is, as it were, brought in as a makeweight in the sense that in terms
of soft drinks there is no distinction; in terms
of wine, where you say there is no litter control,
you are not worried about the energy and other
considerations at all; in terms of all the other containers you are not worried about that; and yet, we are, as it were, asked to accept that
this massive increase to 15 cents, which cannot
be justified in terms of litter control, is
justified by this makeweight. reference in a
couple of sentences which obviously is regarded as not even worth bothering about in terms of anything else.

(Continued on page 117)

C 1 T9 / 2 /ND _

116   31/5/89

Castlemaine(2)

MR DOYLE:	Your Honour, could I make a few points in answer to
that. First of all, just looking in isolation at the
two containers Your Honour referred to. Wine containers:
the problem there is as a large amount, as any member
of the Court would know, of the wine made in
South Australia is sold in other States. It is in
effect impossible to apply these methods - well, not impossible, but almost futile in applying these
methods to the containers because a deposit and
return system cannot work in another State where it
is unknown.
DEANE J:	Why not at a retail outlet in South Australia?
MR.DOYLE:	It could at the retail level in South Australia,
Your Honour, although then you have the problem of a
system if you are going to put the bottles out for instance showing refund amounts on them, they are
going to be sold in States where that system does
not apply and obviously there are problems of
confusion and whether it is worthwhile. As to soft
drinks - well, the market there is, of course, a
different one but if one focused· simply on the point Your Honour says one could say, 'Wall why
did they not follow it through and apply it to soft drinks?"and there is no simply or obvious answer to that.
As to it being a mere makeweight, Your Honour, compared with what Your Honour called the "massive"
or "substantial" difference in deposits, our
submission is that if the policy is to encourage
refillable containers and to discourage non-refillable containers, then the policy is really.meaningless
unless one does in effect impose a substantial or very
significant disadvantage on them. If the policy is
to discourage them then either one bans them outright
or, alternatively, one imposes a deposit difference
which is very significant because until it gets big
enough to really discourage people from buying the drinks
it becomes, as it were, self-defeating. And so if
one went to,let us say 10 cents instead of 1~ the
lower it goes the less is the disincentive and one
might as well then say, well then, why bother at all? So, while at first sight it may seem odd that
such a significant deposit level is imposed in the pursuit of something that is only referred to by the
Minister among a number of other things, in our
submission, if one analyses it in that way one soon
realizes that unless it is a significant differential
it will not achieve anything at all and then there
is just no point in doing it.  So that is our
answer to what Your Honour says, that while clearly, when one reads the second reading speec~ it is
litter control which has triggered this legislation
off and, as it were, the legislator has started by
looking at containers that are a problem in litter

ClTl0/1/FK -	117	MR DOYLE,	31 / 5 / 89-
Castlemaine(2)

terms, in our submission it is also quite clear
that having done that, he has said 'well now, in effect

while we are at it we will also pursue another policy which we favour, namely conservation of

resources". And it can fairly be said, as Your Honour

says, well, why did they not bite the bullet and

do exactly the same with soft drink cans and it could be said, why did they not, for instance, encourage

milk bottle and discourage milk cartons .	0 ur
only answer to that can be that obviously

legislators have to make judgement about the extent

to which they can pursue a policy.

But perhaps I could say one other thing, that

obviously we are concerned here - and I will have to

come to this later - with some sort of purpose of

inquiry. The Court cannot decide this case just in

terms of effects. Mere effects will never enable you
to pick a protectionist law from a non-protectionist

one. Bu~ in our submission,it is significant if we

go back to 1975, that as at 1975,we would submit,

there was just no hint of protectionism in this.	The
local brewer was using cans and non-refillable
bottles.	The Australian market was largely a

within-State market and, if one looks at the events of 1975 and says, ''Wall now,really, is this reference to energy conservation thrown in there to justify

what might otherwise look like a protection measure?"

We submit there is just no hint of protectionism in the events of 1975. And, as the facts in the

special case show,at that time only someone with

extraordinary prescience would have foreseen the

shift - the heavy shift - in the eastern States

to non-refillable 375 ml bottles, and the way

in which the market developed and,in our submission,

if one looks at it through 19JS eyes, what might

seem, as it were, a misleading makeweight thrown in

today when put in context, in our submission, takes

on a very different appearance.

(Continued on page 119)

ClTl0/2/FK -	118	31/5/89
Castlemaine(2)

DEANE J:	I should mention in fairness to you, I am greatly
influenced in what I have put to you by paragraph 86 which is the very last paragraph of the stated case.
MR DOYLE:	Could I just Your Honour to elaborate a little more?

I do not - - -

DEANE J:	Well, on wine, they say they are not a litter problem;
therefore:

Accordingly -

they -

should not be the subject of a deposit.

MR DOYLE:  Yes. Well, Your Honour, as I said a moment ago,

it seems clear, looking at the second reading speech

that it was litter problems that, as it were, triggered

off the legislation and while it may seem untidy and a

little illogical that they did not say, "We are starting

with a litter problem. Along the way we will grapple
with resource wastage" and, then take the first s_!:ep and

say, "And although wine containers do not involve

litter, they do involve resource wastage; therefore':

on Your Honour's suggested approach, "we will also

grapple with resource wastage in wine containers."

Our submission is that while I cannot say to

Your Honours that those matters are irrelevant, in

my submission, one must be very cautious in reasoning

in that way because it amounts to saying that because

Parliament has not more thoroughly grappled with the

problem one imputes, as it were, a different object to

the legislation. Now, that is a relevant matter to

consider but, on the other hand, as I mentioned a

moment ago, one could say the same thing, I suppose,

about milk bottles, containers for other things and

a point must be reached, in our submission, at which

the Court says, "Well, Parliament must be the judge

of how far it will go at a given time, and in the

particular circumstances, in pursuit of its policy"

and so, I would urge upon the Court that the failure

to follow the policy through more thoroughly the

Court should be very slow to conclude from that, that

in so far as the policy was pursued, it really was not

bona fide and that that really was just a cover for

some other object and, without wanting to labour the

point unduly, if one goes back to 1975, it just seems

inconveivable, in my submission, that at that time this

was thought of as a way of preserving the local market

because it was the local producer who, at that time,

was about to bear the full brunt of this legislation

and, at that time, the local producer really had the

market to itself and the mid-1980s development of

interstate trade in beer just had not occurred.

ClTll/1/SH - 119 31/5/89

Castlemaine(2) (Continued on page 119A)

So, I would submit to Your Honour that that particular approach should not be taken.

BRENNAN J:  Mr Solicitor, in the answers you have given to

Justice Deane you said that it would not be

sufficient for the Court to look merely at effect

but in a case like this it is necessary to look at
the question of purpose. That seems to me to assume
the particular criterion which the Court should apply.

If one were to look merely at effect, one might then be engaged in an exercise of baJa.ncing, determining

whether one effect is greater than another and, if need be, postulating a purpose by reference to the

effect so found and, perhaps, imputing to the legislature

a knowledge of the industry which is subject to the

effects which the legislation would produce.

Well, now, that is one approach that one might take.

If one is involved in a question of purpose, one is

involved, perhaps, in the sense in which you are
putting it, as I understood it, in an inquiry as to

whether the legislature bone fide intended to produce

a particular effect and that, of course, is a different

criterion and I confess to a great deal of

uncomfortableness about inquiring into the bona £ides

of the legislature and I am not yet clear as to what

submission you make as to the true criterion to be

adopted.

MR DOYLE:  No. Your Honour, I will be coming to that and, in

the outline, they are the matters which I endeavour to

address and we will address but, because in our

submission the facts are so important here and it is

so important to get this law in context that the risk

of why I am looking at facts being unclear, I have taken

the approach of dealing initially just with the facts

before I, then, go to what one does as a matter of

law with those facts.

(Continued on page 120)

ClTll/2/SH	119A	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And if I could just indicate, we

do not suggest, in our submission, a balancing

approach, either along the ?IKE. line or otherwise,

nor do we suggest some kind of inquiry

into subjective motives or purposes of legislators.

But what we do suggest, and I will endeavour to

develop shortly, is that one looks for the objects

of the legislation and one determines then, by

looking at the fairly immediate effects of the

operation of the law, and with an understanding

of the mischief at which it was aimed.

So, Your Honours, paragraph 16, I think I have really covered in answer to Your Honour

Justice Deane, that looking at the 1975 Act, putting it in a nutshell, that would not in any

sense have been seen at the time, nor on the

facts as having any particular effect on

interstate competition.

If I could then go to what happened between

1975 and 1986, and the importance of this, just

at the factural level, is the submission I will

make in a few moments, that in 1986 all parliament

did was tidy up an existing scheme and in fact

exert slightly tighter control over refillable

containers, far from it doing anything which

points at an effect on interstate trade. In

my submission, when we look at it properly, we

will see that it has merely tidied up the scheme

and in fact, tidied up in particular by putting

greater controls on those using refillable

containers, who happen to be mainly the local

producer.

But when we look at what happened between

1975 and 1986, first of all, as the special

case shows, and this is paragraph 17, cans were

little used in South Australia and far less than

elsewhere, which in our submission indicates

that the policy of discouraging cans for beer

was being successful. However an increasing

proportion of the sales of packaged beer was

made in the 375ml containers, both in South

Australia and elsewhere, so they were proving

to be a popular container, that is the size

container was proving to be popular.

In South Australa, as we know, they were

vertually all refillables; interstate they were
mainly non-refillables. But the significant thing,

in our submission,is that the deposit level

remained at five cents per container, for

non-refillable bottles and cans, but during this

period it increased steadily, for refillable

bottles.

CIT12/l/CM	120	31/5/89
Castlemaine(2)

For ·the 375ml bottles it began at 12 cents

per dozen, and during this period increased in
fact to 50 cents per dozen, or just over four
cents per container. That emerges conveniently

from another second reading speech which I will

go to in a moment. If Your Honours want to make

a note, it is page 180 in the dabates. For the
large bottles, the deposit level increased, under

the voluntary scheme, from 15 cents per dozen to

50 cents per dozen, and I have also referred there

to appendix 5 where we have attempted to tabulate

these changes.

Now if one bears in mind what the law, on

our submission, was directed to doing, then what

had happened during this 10 or 11 years was,

first of all, the deposit level for non-refillable

bottles, which has remained at five cents, is

becoming less significant. With inflation

obviously five cents in 1975 was a much bigger
incentive to bring a bottle back than it was in
1986. Reflecting that, the deposit levels for
the non-refillable containers have risen to around
about four cents a container.

And in terms of the original policy of discouraging non-refillable containers, time

has eroded that entirely. So that in 1975 we

started with one cent per container approximately,

for refillables, and five cents per container

for non-refillables. By 1986 it has gone from

one as to five to approximately four as to five. And in our respectful submission, those simple facts demonstrate what emerges from the second

reading speech: that unless parliament acted,

the system was about to collapse, because there

was no longer any significant incentive to use

refillables as against non-refillables, or

putting it the other way, there was no longer a

significant discouragement of non-refillable

containers. (Continued on page 122)

CIT12/2/CM	121	31/5/89
Castlemaine(2)

MR DOYLE (continuing): One can say, of course, that was

Parliament or the Executive's own fault because

through inaction it had failed to amend the Act

and increase deposit levels. But all that

indicates is that, again, had the deposit levels

been appropriately adjusted during the decade

then once again the facts would look rather
different. It does look, at first blush, as if

this was done as some kind of response to the

entry of the plaintiffs into the South Australian

market. But, in our respectful submission, when

one looks at it in context, the entry of the

plaintiffs into the market simply brought home

very forceably that the system was, as it were, not perhaps on the point of collapse but was not achieving its original objectives and that the

entry of the plaintiffs meant that those objectives

would in fact be frustrated because there was no

disincentive to them to come into the market with

non-refillable containers. So our submission is

that those events both explain first of all why

a change had to be made and secondly explain

the time that it was with the arrival of the

plaintiffs on the scene that these events assumed a particular significance and it was obvious that

if the Parliament was to continue to manifest a policy against non-refillable containers then a

change would have to be made because there was
in effect no real policy any longer.

The other thing which is perhaps of less significance, but it was only during that decade -

the point we make at the bottom of page 8 that

Carlton United Brewery acquired a significant

share in the South Australian market - that

the .present cross-State sale of beer became

a significant thing in South Australia.

DEANE J: But putting aside the conservation non-litter

considerations, was it not the effect·of the

5 Cents~ 4 cents deposit that the correct

margin had been reached where the cost of use' of the refillable bottle was less than	1 cent a bottle more than the ·hon-refillable?
I mean, in so far as litter is concerned, they are going to come back regardless of whether they are refillable or non-refillable.

MR DOYLE:	As to litter, Your Honour, the only point we
make is that 5 cents was, now 11 years later,
a much reduced incentive. As to conservation
of energy and resources our submission is that with there only now being a 1 cent deposit differential - - -

DEANE J: But so far as litter is concerned, the deposit

is to provide an incentive to the customer to

bring it back.

CIT13/l/JM	122	31/5/89
Castlemaine(2)

MR DOYLE:  Yes.

DEANE J: Which means there is no justification for any

differentiation at all.

MR DOYLE:	I perhaps put it badly, Your Honour. As to
litter we agree that provided there is a
return system in place for both containers, that whatever is the sufficient incentive
to bring the bottle back will apply equally to the two containers.
DEANE J:	So all we are talking about is carbon dioxide

and energy as justifying any distinction in

the deposit?

MR DOYLE: In substance, yes, Your Honour.

DEANE J: Which means that we come right back to the

question whether this massive differentiation

can be seen in the context of the material before

the Court as genuinely related to an assessment

of the dangers of carbon dioxide and shortage of

energy in South Australia, in the context of the

approach to everything else?

MR DOYLE: 

Your Honour, could I say in answer to that,

in a sense we agree with Your Honour, with respect,
but we would put it differently, and although to
answer Your Honour in the way I would like, I would

have to jump, as it were, into the middle of my

argument.  I think it is, with respect, best that

I do.  The way we would put it is that the

approach for the Court is more along the lines of whether Parliament could reasonably have regarded

these as means of achieving its objectives and

if they are its objectives, our submission is

that Parliament may then pursue its objectives

notwithstanding an adverse effect on interstate

trade.

(Continued on page 134)

CIT13/2/JM	123	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  But the proper approach is not,

as it were, saying, "We will try to quantify

the local benefit and weigh it against the adverse

effect on interstate trade." That, in our

submission, is very close, if that were the approach,

to the PIKE approach. We submit, for reasons

I will endeavour to explain, that that is not

a proper approach in Australia, that what one
does is say, "Well, does this law have objectives
which are not protectionist and, if it does,

and if protectionism is not one of the objects,

then the fact that to us, as a court, the gain

locally may not seem worth the damage done to

interstate trade."

In our submission, that is not a step that

one takes. One looks for the objectives of the

law and one does not go to what I will call the

PIKE further step of balancing local benefits

against adverse effects on interstate trade.

And, for two reasons which I will put very shortly,

first of all, as the American cases illustrate,

it is an almost unattainable objective, that

is, to really balance those two things, and one

which is particularly difficult for the courts to do. And I have actually forgotten what the

second reason was now, Your Honour. Perhaps

I will remember when I come back to it. But

there are two reasons why we say that the PIKE

approach is not appropriate in the Australian

context. But just to finish that off, we do
agree with Your Honour Justice Deane that in

so far as there is a deposit differential, that

is an issue related to conservation and litter

control does not justify a deposit differential.

That must be, in one way or another, related to the issue of conservation.

BRENNAN J: What does one do, Mr Doyle, if one is not

convinced of the proposition which is conceded

about the same figure being effective with regard

to refillable and non-refillable bottles? It

seems to me to be curious that if one picks up

one bottle and says, "It is refillable", another

that says, "It is is non-refillable", that the

same incentive is to be provided for the return of each by the existence of a four cent deposit. It equally seems to me curious that when the

producer has an incentive to get back the refillable

bottle but not the non-refillable bottle that

the same deposit will produce, in fact, the same

rate of return. None the less, the stated case

says that it is so.

MR DOYLE:  Could I go to the second part of that matter,
Your Honour, that is the facts, and then I will

C 1Tl4/l /NU 124 31/5/89

Castlemaine(2)

back to the question, "What is one to do?"

When I, in answer to Justice Deane and perhaps other members of the Court, said, "There is the

same incentive", I was directing my submissions

to the consumer of the drink. From his point

of view, in our submission, if the bottle indicates
that he will get four cents or five cents by

taking it back, and as long as there is a place

to take it back, we do not ourselves suggest

that he is less likely then to take back a

non-refillable container. We accept, for better

or worse, for the purpose of this case, that

provided he knows the money he can get by taking it back and provided there is a convenient place

to take it back, he is as likely to return one

container as the other.

We do not suggest that, looking at it from

the producer's eyes, that the position is exactly
the same and we do accept that the producer of the

beer would probably be more anxious to get a

refillable bottle back and, in fact, for the

producer of the non-refillable container he,

in a sense, does not want it back at all; the

deposit is there simply to get it collected and,

presumably, then, either recycled through melting

it down and whatever they do or simply into the
litter stream - it either is recycled or into
the waste or litter stream.

As to the first point, what does Your Honour do if, despite what I have put Your Honour does

not accept that view of the facts, in our submission,

this case is in that very awkward and not yet

fully explored area of constitutional facts.

These do seem to be facts which are relevant

to validity. The Court is not bound by the parties'

treatment of them and while the parties have,

in a sense, hampered the Court, obviously by
putting limited facts before them - as Your Honours
no .doubt understan4 we did this to avoid what

would have been a very lengthy trial where we

ourselves were in heated dispute as to what were

relevant facts, let alone how to prove them.

(Continued on page 126)

C1T14/2/ND-	125	31/5/89
Castlemaine(2)

MR DOYLE (continuing): So, I am not sure that is of much

to it, that the cases do indicate tha4 in relation to constitutional fact~ the Court has a not clearly defined duty to satisfy itself - there are no matters of onus in relation to such facts,

assistance Your Honour but I would accept the before

it would seem. Presumably, in our submission,

either if it was a mere matter of inference from
facts Your Honours would draw the inferences which

you think appropriate, but if there were facts

missing, which left Your Honours in the position

where you felt that, or considered that, a proper

conclusion could not be drawn and that, therefore,
matters essential to the disposition of the case
were missing it would be proper for the Court to

tell the parties what those facts were and, while the

inconvenience to the Court would be regrette~ the

parties would have to go away and endeavour to

fill the gap.

BRENNAN J: Well, on that invitation, I just mention one	other fact which I would find of assistance: namely,
by what percentage of the total retail price was
the deoosit an increase over - I will put it another
way. What percentage of the total price is the
deposit?
MR DOYLE:	Yes. Your Honour, could I, simply having noted that, see what we can do about that. That is something we may well, as between ourselves, be able to provide
to the Court by way of a table a little later. It
could not be done, I think, today because prices
would have moved and we are covering a range of
containers but, provided there are adequate statistics,
we should be able to put that in tabular form. So, and just quickly going through paragraphs 18, 19 and 20,
there had been that Australia-wide trend towards the
use of non-refillable bottles and cans but that trend had not occurred in South Australia, although in South Australia there had been a swing to the small
bottles.  We submit, that that was because of the legislative
discouragement of the use of those containers and the
fact that, responding to that, the local brewer, which
at that time - and still, probably - dominated the
market, had incurred the cost of changing to the
refillables.  So it all highlights the point, in our
submission, that when one comes to 1986 it was crystal
clear that if the Parliament did have a policy of discouraging non-refillables something had to be done.
Then, when we look at the 1986 Act, my broad submission is, as I indicated a few moments ago, that Parliament merely tidied up the existing system and that one can
fairly say no change was made.

ClTlS/1/DR	126	31/5/89
Castlemaine(2)

So if one goes to 1986, we submit, it is

important to bear in mind that Parliament was, on

our submission, just tidying up what was already

there. Could I just go through the things that

it did do? First of all it specified clearly

that glass beer containers could be exempted only

from point of sale - the point of sale refund

requirement. Under the 1975 Act, a container could

be exempted wholly from the Act - and refillable

containers were. After 1986 a refillable container

could now only be exempted from section 7 - the

point of sale requirement - and so now it had to

display a deposit amount - it did not previously;

it had to earn, what I call the statutory deposit -

it did not previously. And, so, while one would

expect that exemptions in 1975 were given only

when the relevant authority was satisfied, obviously

that the containers would carry an adequate deposit

and it would be displayed.

In fact, Parliament, in this respect, was

simply tightening the Act up to make it clear on the

terms of the Act that you could only get out of the

point of sale requirement and that to get out of

that you must - sorry, the two are not related - and
that even if you got out of it, you still had to

comply with other requirements of the Act. So, in

that respect, it actually tightened the control

over refillable containers - obviously tightened

controls relative mainly to litter. In substance,

in our submission, and this is at the top of page 10,

it made no other change. The system remained that

beverage containers -now all beverage containers -

must display a refund amount and for all containers

there had to be a place of return, be it point of

sale or a collection depot.

(Continued on page 128)

C1Tl5/2/DR	127	31/5/89
Castlemaine(2)

MR DOYLE (continuing): So, in that respect, there was no

change. The other two matters which I have not

out there but I would seek to put forward are that

it also, in the 1986 Act, dealt with the wine cooler

containers more clearly. Under the 1975 Act, if one

looks at it, one would be in doubt whether wine

coolers were wine or some other type of beverage and

how they should be treated.

Whatever is the right answer under the 1975 Act,

it is clear that in 1986 Parliament saw the need to

put the situation beyond any doubt and so it has

dealt specifically with wine cooler containers and

as the special case shows that was an industry which

was substantially local and the local producers were

using non-refillable bottles and, as the special case

shows, a substantial number-of them in response to

that switched to refillable bottles. So, once again,

if one looks at what the Act does, it simply tightens

up the scheme in a manner consistent with the overall

scheme and, once again, if one is looking for

indicators or hints of protectionist motives, there

is no sign of it doing anything which helps the local

industry in relation to wine coolers.

The other point which tends to get overlooked at

times and is true of both the 1975 Act and the 1986

Act is that as to cans all producers are being treated equally. There is no way or no sense in which it can

be said that local can producers are better off than

interstate can producers of beer and, again, as to

the mischief at which the 1986 amendments were aimed,

can I just go, for the last time, to the debates for

the second reading speech on those amendments. They
are at page 180. I would like just to indicate to the

Court the points I seek to draw out of the explanation

of the bill. I think some of this may have been read

by my learned friend, Mr Jackson, yesterday and we

certainly do not dispute that it is proper for the

Court to have regard to a second reading speech to

identify the mischief. We submit that is really all

that can be done with the debates. The minister, in the left-hand colunm, first of

all alludes to the fact that the South Australian

Brewery has gone to 50 cents a dozen for the refillable

containers; the other one is only at 30 cents and, as
he says, it "would be an environmentally retrograde

step" to allow a 30 cent deposit level and he goes

on to explain:

For that reason, in effect, we are now legislating

to control deposit levels forrefillable containers.

It is important to bear in mind that until the amendments,

once the refillables were exempted, they were right

outside the Act.

C 1 T 16 / 1 / SH . 128 31/5/89

Castlemaine(2)

So, first of all, a judgment has been made

that something like 50 cents a dozen needs to be

insisted upon even for refillables and so that is

one of the mischiefs that the - an inadequate deposit

level for certain refillable bottles.	He goes on to
say it will be 48 cents oer dozen.

Then he says:

The effect of this change, if taken on its

own, would be to seriously erode the differential

between multi and one trip containers and hence

reduce the strong disincentive against a move

into one trip packages.

This goes back to the matters I put in answer to

Your Honour Justice Deane. Events had already produced

that situation because the refillable bottles were

already, under the voluntary system, carrying either

30 cents or 50 cents per dozen and so the differential

had been eroded but, as the minister says and rightly,

in our submission, "Well, as Parliament is now

legislating to enforce a deposit on refillable
containers, it itself will be destroying the incentive

which it sought to create in 1975 unless it makes an

appropriate adjustment to the level for non-refillable containers."

BRENNAN J: Are you able to demonstrate that there will be a

restoration of relativity between the deposits on

multi and one trip containers?

MR DOYLE: Yes, Your Honour, in this sense: that in 1975, it

was one cent per container for refillable beer bottles

and four cents per container for non~refillables, the

ratio of one as to four.

(Continued on page 130)

ClT16/2/SH	129	31/5/89
Castlemaine-(2)

MR DOYLE (continuing): After 1986 it was 4 cents per container for refillables or 48 cents a dozen and 15 cents per container for non-refillables, so the relativity has

just adjusted slightly. It has gone from one as to

four, or four to one to almost four to one. It would be precisely four to one if it was obviously 16 cents

instead of 15. So, mathematically, in fact the

relativities have been restored, but also in absolute

terms we now have a differential of 11 cents in 1986

compared with a differential of 4 cents in 1975 and

it must be a matter of judgment obviously just what is

the right differential. But again in our submission,

if you are going to discourage a certain type of

container, unless the differential is significant, you

will not in fact discourage it and so, in effect, why

bother at all.

Then the minister says, in the next paragraph

the second sentence:

The higher deposits will have the effect of increasing scavenging, thereby reducing the

loss of resources to either the litter stream

or buried in rubbish tips. In this way the

twin objectives of the legislation - litter

control and resource re-use - will be

improved.

And, in my submission that - what he says there is

supported by the simple facts of the case.

The Bill proposes to overcome some

administration shortfalls - And that is really all he says. Could I go

to the second reading speech in the tipper h.ouse at

page 206, just for one point out of that. In the

left-hand column at about the middle of the page

the minister in the upper house says:

As a result of amendments in the other House,

the Bill now contains provisions which put

it beyond doubt that the Act may have application

to the glass containers used for the new

"Wine Cooler" type of beverage.

And so, as he indicates, that that was a problem which - well not a problem - the addressing of that

problem arose from amendments in the l~wer house

and so that is a matter, by way of mischief, which

is not found obviously for that reason in the

second reading speech in the lower house. It

is perhaps impossible for me to ignore the ilourish

with which Mr Jackson finished yesterday when hP.

went to the speech of Dr Cornwall in the upper h~use

and so, for better or worse, I feel irresistibly

ClT17/l/FK	130	31/5/89
Cas tlemaine-( 2)

drawn back to that topic, mindful of Chief Justice's

comment ab.out "it seemed to be gold".	Our submission
is, it really was mere dross ..

First of all, this is simply a speech by someone

who is a minister, but it is a speech in committee

dealing with particular clauses of the bill, and our
submission is, that while it is proper to go to a
second reading speech to identify the mischief, if

one starts to go to speeches in committee, it is

hard to know then why one stops with someone who

happens to be a government minister, why not a

government back bencher. Why not someone who on his

speech seems to be a perceptive member of the

opposition. In our submission, one should not look

to such material, but could I just go to the next page

where Dr Cornwall kept talking and just make this

point.

If Your Honours would look at page 215. My

learned friend yesterday read from page 214 and the
reference to 'interstate giants" - I was not sure

if he was referring to the legal counsel or the

brewers, but it is clear it was the brewers he was

talking about. At the bottom of the left-hand

column Dr Cornwall says, obviously giving his version

of what the Act is all about, or the amendments:

I can explain it simply and in a short space

of time. What we are doing is placing a further

disincentive on all non-refillable containers.

The can is one of those containers; the stubby

is another. Currently we have in this State

Castlemaine Tooheys and Swan, both marketing a

non-returnable stubby. The deposit is only Sc.

It is no disincentive for every mug .....

We want to stop the flood of non-returnable

containers from interstate, which is threatening to break down what has previously been very good

and very effective legislation. So, it is not

that we want to discriminate in favour of the

can as against the bottle: it is that we

actively doing so, against the non-refillable,

non-reusable containers, whether they be cans or

stubbies, as against the recyclable, reusable

echoes .....

certainly want to discriminate, and are

(Continued on page 132)

C1Tl7/2/FK	131	31/5/89
Castlemaine(2)

MR OOYI.E (continuing): Just down the page, that is, just down

that column, he gives the figures which I gave

a moment ago in relation to deposit levels, and

then at the bottom of the page, comes back to

the topic that my learned friend picked out:

The specific problems that were being_ experienu:ed
and because of the activities of Castlemaine, Tooheys
and Swan -were not spelt out dur:i.ng tbe second

reading_ explanation.: ... one of the reasons for this

legislation .... rI will repeat what I·said

earlier .. : .. we want to ensure that the South Australian Brewing Ca.npany can corrpete on at least an equal basis.

Now it may be, if Your Honours reject my

submission, that this is not proper material to

refer to, but Your Honours would then infer that

this minister, and query the government, sees the

objective of the legislation as to preserve the

market for South Australian Brewing but, could

I make this submission, that unless the discouragement

of non-refillable containers is maintained, there

is little or no incentive for the local brewing

company to use them and, I can at least say this

much, it is understandable that a minister should

seek to explain it in terms of it being fair to

the local company because, in a way, that is how

it looks. If the local company is using non-

refillable containers, which parliament wants

used, but the deposit levels are such that there

is no discouragement, then one can easily drift

into talking of what is fair.

In our submission, looked at.in context,

what he is simply saying is that it does not

make sense that we have not got a differential

and why is the local brewing company going to use

the container we prefer if there is no

differential. But my fundamental submission is

that that is not material to which reference

should be made. So we submit, Your Honours, that when the

1986 amendments are put in context, they emerge

very clearly as something which merely tidied

up and tightened up the system and restored

the relativities to what they had been in 1975

and that the timing has no particular significance,

other than the rapid increase of non-refillable

containers, due to the plaintiffs making the

sales indicated that the system was at a point

where it would cease to work as soon as someone

using those containers sought to sell in the

market.

CIT18/l/CM	132	31/5/89
Castlemaine(2)

And we submit that the regulatiorasimply

fit into that pattern simply carrying through

those objectives. Could I just make a few

random points on the facts arising out of points
made by my learned friend yesterday. In relation

to the point of sale requirement, and whether that

really is a significant disincentive, it has to

be borne in mind that,on the stated case, it

said that the plaintiffs could have achieved

about 10 per cent of the market. Now, they

would have achieved that with the point of sale requirement there, and so it cannot be too much

of a disincentive.

He referred to, a:s one of the facts· of-significance,

as I understood him, to the way in which the

exempting notice was drawn, but did not elaborate,

and so it was left uncertain what significance was

placed on it. That appears in the volume of

legislative material at page 37, the very last page.

Now, if the submission was that there is something

sinister or significant in the specificity of the

exemption, that is, pickaxe brand, which is

South Australian Brewing and CUB brand, which is

Carlton United, our submission is that, if the

exemption or notice had been drawn in terms of

refillable bottles, then any person in the market

who is prosecuted would have a defence and say ,

"· all, my bottle is in fact refillable • lhless

it is proved that it is not refillable, I fall within

this notice."

And in our submission, as a matter of practical

enforcement of the legislation, it is reaJily

understandable that any such notices were drawn

as narrowly as possible, so that each particular producer would have to come along and submit his

container and get an exemption or notice made

specific to his container. And so, in our submission,

that enforcement type reasoning. would explain quite

readily why the notice is drawn as specifically as

it is. (Continued on page ·134)

CIT18/2/CM	133	31/5/89
Castlemaine(2).

MR DOYLE (continuing): There is no suggestion in the

special case that if the plaintiffs produced

a satisfactory refillable container that they

would not be the beneficiaries of a similar

notice.

BRENNAN J: It is necessary for the minister to be

satisfied about the qualities of the particular

containter.

MR DOYLE:	Yes, that is so and so in the end one has to
get down to a very specific exemption.

My learned friend also referred to the

fact that part of the system of exemptions was

that the producer had to show not only that the

bottle was designed to be refilled but would be

taken back and refilled and that there were

added cartage costs for his clients as interstate

producers. In our respectful submission, just at

the factual level, first of all, that is simply

a function of distance. It is nothing to do with

being interstate and if there were a brewery

in South Australia in Mount Gambier, 500 kilometres

from Adelaide, it would equally suffer the same

burden.

The second point is that once again it is not

as if there is anything gratuitous. about that;

it is of the nature of a system of reusable

containers that they be reused. So I simply

make that point that there is nothing gratuitous

or unnecessary about that requirement.

My learned friend also said at one stage

that no collection depots had been approved for

non-refillable beer bottles and referred

to paragraph 56(i) of the special case and, again,

as I understood him, seemed to suggest that

perhaps there was some ulterior motive in that.

01:Jrpoint as to that is that section 10, which

relates to collection depots, does not apply

to containers which fall within section 7. If

Your Honours would just look at section 10

which provides that a retailer, in effect, is

not to sell a beverage for consumption off the

premises:unless the point of sale is within

a collection area. What he said was, "Well, :there are

no. depots prescribed for non-refillable containers",

but subsection (la) says:

This section does not apply to containers to

which section 7 applies.

So his containers are containers within section 7 and

do that section does not apply. So the failure to

prescribe depots in relation to non-refillable beer

· bottles, in our submission, is not of any significance.

CIT19/l/JM	134	31/5/89
Castlemaine(2)

That completes the submissions I wish to make

in relation to the facts. Could I then go to the

issue of protectionism? In our submission,

Your Honours, the essence of protectionism is

the use of legislative,or perhaps other means

so as to improve the competitive position of

local traders as against interstate competitors

because they are local. There is a purposive

notion or element in the whole idea of protectionism

and so we start from that premise.

In our submission also, as COLE V WHITFIELD

indicates, protectionist laws can perhaps be

grouped under two very broad headings and the

first of those, which for convenience I will

call overtly portectionist laws, are laws

which, in our submission, on their face or on

their terms, impose a discriminatory burden

as between local trade and interstate trade,

and secondly, which do not appear to have objects

other than the placing of that discriminatory

burden. If a law is overtly discriminatory

of that type, what COLE V WHITFIELD suggests

and rightly, in our respectful submission, is

that without any further inquiry such a law

will be invalid. Examples were given of such

laws in COLE V WHITFIELD. I do not ask Your Honours

to go to the case, but examples are given at

page 310, column 2, letter G.	I have noted that
in paragraph 2 of the outline.

The examples were: tariffs,which obviously

on their face impose a discriminatory burden,

and one can say display no other object than the

imposing of that discriminatory burden, they

are overtly protectionist, no further inquiry

needed; quotas on imports, in our submission,

to be similarly treated and also dealt with

by section 92; subsidies on local protection,

they are dealt with by section 90, in our

submission; and then, discriminatory burdens

on dealings and imports, they are dealt with

by section 92. The other example given under

this broad heading in COLE V WHITFIELD was

differential railway rates, which may or may not

be a law, but obviously may well be overtly

discriminatory, although, in our submission,
one would tend to think that in that area one

would not too often find a differential railway

rate which was overtly discriminatory. Usually

one would need to have some factual material

before one could discern whether there was in

fact discrimination there.

CITl 9 /2/ JM - 135 31/5/89

Castlemaine(2)

MR DOYLE (continuing):  But our submission is one can start

by saying there are certain laws which we have

called overtly discriminatory and which, without

any significant inquiry, can be declared invalid.

However, in our submission, that cannot be said

of the present law. It is not that overtly
discriminatory type. It is also important, in

our submission, to bear in mind that it is not just the imposing of the discriminatory burden

which puts a law into this category because a
law which bans the import, say, of diseased cattle

or diseased vines, to use examples which were common at the turn of the century, imposes on

its terms a discriminatory burden but also displays

a non-protectionist object or purpose, namely,

preventing the introduction of diseased commodities.

And so, that first category is, in our

submission, a relatively narrow category and

where the law on its terms displays a .

non-protectionist object some further inquiry

is going to be needed. And so we would put that

sort of law in the second category but, again,

submit that in this case the present law is not
such a law.

Then you may have a law which, on its terms, or on its face, imposes no discriminatory burden

but, in fact, does reduce the movement of trade

from State to State. And, again, in our submission,

if one comes at it from the other way, it is

quite clear that a non-protectionist law may

do that. A law which is passed simply to impose

a safety standard or some product standard may quite easily be shown to have reduced the flow

of trade from one State to another. And, in

our submission, one can again, if one looks for

propositions that can be made reasonably safely,
say such a law may be valid; in other words,

protectionism must be more than effects on

interstate trade because if one looked merely

to effects, laws which everyone would accept

as valid and non-protectionist immediately appear

to be protectionist.

So, whatever the test is, it has to be a

test which focuses on something more than effects

and, in our submission, the real problem which

the Court faces in this case is the problem

which it faced and dealt with in COLE V WHITFIELD

of whether this law does raise a burden to

interstate trade or a barrier and then what

is, in our submission, an equally difficult

but quite separate question whether that burden

or barrier is to be called protectionist.

ClT2O/1/ND	136	31/5/89
Castlemaine(2)

Your Honours, could I put some negative propositions because, in our submission, one

has to approach the consideration of a matter

like this with considerable care and endeavour

to identify things which are not properly to

be considered as well as things which. are to

be considered. And the first thing which we

submit is not to be done, in one way or another,

is the calculating or balancing of costs imposed

on private individuals as against some quantification

of public benefits.

In our submission, the issue of protectionism

does not require the Court to endeavour to cost
out, in some comparable units, be they dollars

or something else, the costs the law is putting

on individuals as against the dollar value of

the public benefits. And, in our submission,

any test which required the Court to do that

would be a valueless test and one which would

produce, first of all an almost endless inquiry
because one would not even know where to stop

in terms of whose costs one looks at; and,

secondly, it is an inquiry which, in its nature,

is not worth attempting because too often the

relative things in the scales will just be

incomparables and one can say, in this case,

"How can we compare the cost to Bond Brewing,

or the plaintiff companies, of not getting into

the South Australian market against the saving

of resources?".

(Continued on page 138)

C1T20/2/ND	137	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And, as we acknowledge, the special

case shows that if that is our task we cannot

discharge it because we just cannot, in any sensible

way, quantify the benefits let alone the local

benefits. So, first of all, we submit, the Court

does not and must be careful not to get into a

situation in which it endeavours to do that sort of

balancing. Arguments which, as it were, pose those

sorts of issues, in our submission, are arguments

pointing in the wrong direction.

The second point and, in our submission, of equal importance, is that it is not the function of

the Court, we would respectfully submit, under

section 92 to balance certain national interests

against local interests apparently advanced by the

law, now to balance them in a more subjective -

what I call non-dollar or non-quantification

approach. My learned friend, in his own argument,

at times, I would submit, appeared to do this.

One thing he sai~ which I tried to note down accurately, was that section 92 prevents a State affecting the

course of trade around the nation unless there is a

good reason to do so. Inherent in that is, obviously,

that we are balancing an effect on the course of

trade around the nation against the validity of a

local reason.

McHUGH J: But is not the question here whether the State,

consistently with section 92, can pass legislation

which burdens the interstate trader, as against his

intrastate rival because the State wishes: one, to

preserve its resources; and, two, to assist in

improving the environment?

MR DOYLE:	Your Honour, with respect, that is the very question
but, in my submission, one has to be careful even in
how one poses it because posing it in that way might
suggest that one does then compare the adverse effects on interstate trade with the local benefits
and that in some way a comparison and weighing of
those two things will give the answer as to whether
it is permissible. That, in our submission, is
what the American Court, under the PIKE approach,
has done but that, in our submission, is not relevant under section 92.

But the point I am seeking to make is a slightly

broader one at the moment and that is tha4 by

reference also to the American case~ my friend referred

to concepts such as a "free market", a "single economy".

In our respectful submission, while those matters may

well have been - and almost certainly were - things
which lead to section 92 being where it is, the only

relevant policy in our CONSTITUTION is that expressed

by section 92, which is a policy against protectionism.

And to say, for instance, that this is a law which

affects the course of trade around the nation - and

may lack a good reason to do so - is immediately to

ClT21/l/DR	138	31/5/89
Castlemaine(2)

drift away from section 92 which speaks of protectionism,

to a broader concept, namel~ the free course of trade

around Australia. The two things may be closely

related and, undoubtedly, the former led to section 92

but the point I seek to make, without wanting to

labour it unduly, is that section 92 does not prohibit

laws which affect the free course of trade around the

nation. It prohibits laws that are protectionist.

And, so, it is clear from the very terms of the

CONSTITUTION that Parliament set itself, in a sense,

or that the framers of the CONSTITUTION set themselves,

a narrower charter; not to prohibit laws, which had that wider effect, but only to prohibit them if they

were protectionist laws. And, in our submission,

it is a very important part of the framework not to

approach section 92 on the basis that its object is

to prevent laws which affect the course of trade
around the nation. Just using that as one of many

phrases used.

McHUGH J: But do your submissions identify protectionism with

the purpose of the legislation as opposed to the

effect of the legislation?

MR DOYLE:	Yes, Your Honour, and what we endeavour to do, be it
successful or not, is to submit that by "purpose" or use the expression "object" and that one divines the
object by looking at what the law does, taking such guidance as one can from a knowledge of the mischief aimed at - and that one can look at something such as a second reading speech to identify the mischief - and that one looks to the objects of a law in that
fashion and, negatively, one does not, we would submit,
certainly look to motives of individual legislators;
so you look at object, not motives, but again you do
not treat all effects of the law as objects.

(Continued on page 140)

ClT21/2/DR	139	31/5/89
Castlemaine(2)

MR OOYLE ~ontinuing):  We would argue for the purpose of this

case and we will seek to develop it that the effect

on the plaintiff companies cannot be called an object

of this law; that the objects of the law are litter

control and conservation of energy. One of its

effects is to discourage the plaintiffs and, in

effect, make it very difficult for them to get into

the South Australian market using a particular container but we would submit that on a proper

approach one simply does not call that an object

of the law and that, in the end, we come to the

conclusion on our argument that this is a law whose

objects do not include protectionism and because

we approach the concept of"object"in that fairly

careful fashion, we are content with the proposition

which is in our outline that if the objects of a

law include protectionism,the law is bad. In other

words, we would accept that if the Court said,

taking our approach to objects, "Well, the objects

of this law were litter, conservation and preserving

the market for the local producer", then we would

accept the law is bad. We do not suggest that the

Court should go to look for or to identify a real

object of the law.	We submit that, again, is an
illusory pursuit.

There will be some laws which have only one object but they will tend to be the exception rathe·r than the

rule but if a law has several objects identified in

the way we suggest and one of them is protectionist

then, to that extent, the law will be bad but we do

identify our objects in that confined manner and we

do not equate effects with objects.

BRENNAN J:  Do I take it that you exclude from objects an

inevitable, foreseen and necessary effect?

MR DOYLE:  Your Honour, I do not think I can give a straight

"yes" or "no" to that. In our submission, this

whole area requires so much that the Court consider

each case in its particular context. If I can

answer Your Honour in the terms of this case, I

would submit that even if; before this legislation,

the 1986 amendments - if I can take them - were brought

into the House, the plaintiffs put a full page

advertizement in the paper saying, "If you do this,

we will not be able to compete in the market", I
would submit that would make no difference to the

case and so, in this particular case, I would submit

that even though it is known and an obvious effect, it

nevertheless, is not an object of the law but I find it

difficult,with respect, to answer that question

completely across the board because, in the end, one has to come back to the particular facts and look at

what the law is doing and what apparent objects it had.

ClT22/l/SH ·	140	31/5/89
Castlemaine(2)

BRENNAN J: It is just that I have some difficulty in

understanding the concept of "object", if one

excludes an inevitable, foreseen and necessary - - -

MR DOYLE:  Yes. Well, I certainly do not say, Your Honour,

as it were, a priori, that they are to be excluded.

On the other hand, I do not acknowledge that because

something is inevitable, foreseen and relatively

direct, that it automatically becomes an object.

DAWSON J: Well, you contest it here - - -

MR DOYLE:	Yes, I do, here in this particular case.
DAWSON J:	- - - in this particular case, this legislation

will discourage the Bond company.

MR DOYLE:	Yes.
DAWSON J:	It will keep them out and it is intended that it

operate that way but it is because they use

non-refillable bottles.

MR DOYLE:  Yes, the particular container.

DAWSON J; That is the object of the Act, as you say; that

is the way you put it.

MR DOYLE:  Yes, and in fact, just on that point, we take it a

little further. We say it keeps them out only because

they use that particular container and, apparently,

wish to put their emphasis on the bottles rather than

the cans because if they come in in cans, they are in

a position of equality and, secondly, only because it

is apparently not economic for them to switch to

refillable containers. So, we do not run away from

the fact that it is not economic for them but it is
only the combination of those two facts that means
that they are, in effect, kept out of the South

Australian market.

(Continued on page 142)

ClT22/2/SH	1~ 1	31/5/89
Castlemaine(2)

MR DOYLE· (continuing):  So, while the distinction between

"direct" and "indirect" effects is both discredited

and not very helpful, in a sense one can say

this is a relatively remote effect of the law

but at the same time I do not seek to deny that

it was foreseeable because one only has to look

at the second reading speech from which I read

earlier to see that the relevant minister was

well aware that this company was coming into

the market with these containers.

Your Honours, just back to section 92.

It is, in our submission, quite important not
to drift into thinking that if the law interferes

with what I will loosely call the "free course

of trade around the nation" that we have then

identified it as prime facie, as it were, within

the prohibition of section 92. Section 92 is

narrower than that and, for better or worse,
has prohibited only laws which may be identified
as protectionist. Obviously, it does that, as

it were, to advance the concept of what I will

loosely call "a common market" in Australia but,

in my submission, it does it in that quite precise

way. So we again would urge very strongly

that there is no relevant interest, as it were,
to go into any scales in uniform regulation of

trade from State to State.

If that had been desired that could have been spelt out in some way or another in the

CONSTITUTION. There is no relevant interest

in traders being able to trade in South Australia

in the same manner as they can trade in Western

Australia or Victoria.	They are simply not relevant
interests to go into the scales.	The prohibition
is a narrow	one and it is that narrow prohibition

which has to be properly understood.

The other important point, in that context,

is that it is section Sl(i), in our respectful

submission, which represents the attempts of

the framers of the CONSTITUTION to deal with
that broader problem.	The Commonwealth has been

given power, generally, in relation to trade

and COIIllJ;lerce among the States and so what we

have is, in our submission, the narrow prohibition

which·speaks equally to the Commonwealth and
the States and then the broader power under which

the Commonwealth may address these wider issues

if it sees fit and that is the scheme of the
framers of the CONSTITUTION and one is, in effect,

destroying that scheme if one starts to read

into section 92 this wider notion of preserving

the free course of trade or of producing a single

market for goods or one in which traders can

move freely from State to State.

C1T23/1/SDL	142	31/5/89
Castlemaine(2)

It is also my submission that, once again, one has to be important in this area to exclude from

one's consideration anything which smacks of

the so-called individual right approach. In
our submission, section 92 is not in the least

concerned with the ability of an individual to

engage in interstate trade free of restrictions

or in a particular manner. Its only concern

is with restrictions which are protectionist

and while they may emerge, and obviously you
do need to look at what is happening to traders

to determine whether a restriction is protectionist, the fact that a law makes it impossible or difficult

for an individual to trade from one State to

another is of itself irrelevant in the sense

that the section does not protect for that individual

a right to trade in his former manner or the

manner in which he trades in his home State.

It is not concerned with that at all.

So a protectionist law may well, and we would submit here does, make it difficult or

impossible for the plaintiff companies to gain

a significant share of the market. That in itself

is not an indicator of protectionism and, in

our submission, although very little use can

be made of the American cases, some of them do

in their facts provide useful illustrations and

makes that point, we would submit, quite nicely.

I do not ask Your Honours to go to the case but

In that case the law imposed a prohibition against

producers of petrol owning retail outlets. All
of the producers were out of State companies -

there were no producers in Maryland.

(Continued on page 144)

C1T23/2/SDL	143	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And so the burden of that law fell

wholely and solely on people who were trading

interstate. Furthermore, there was some prospect

of gain to people in Maryland who own petrol

stations and were not producers because, obviously,

major competitor or competitors were being removed.

And what the court said was, "Well, this law

obviously prevents out .of State producers from

being in the retail market in Maryland. But

it does nothing at all to out of State non-producers

who are in the Maryland retail marke~~ and there
were such people. And so the court said, "The fact that this law falls wholely on people who

are out of State traders does not lead to it

being invalidated."· and, on their approach, it

was neither discrimatory nor a protectionist
law.

It might have allocated trade as between out of State producers and non-producers, but

it was of no significance that it eliminated

out ·Of State producers entirely from the retail market and while we acknowledge no case in this

area can be decided by reasoning from the facts

of case A to facts of case B, that case provides

us with, in my submission, an illustration of

a very important thing to be borne in mind here.

And so, once again, one has to be careful in

approaching this case not to start thinking that

because the plaintiffs are out -of State producers

and because they are the ones who are apparently

burdened by this law, that prima facie that,

in itself, attracts section 92.

In my submission, one cannot even say that

prima facie that attracts section 92. All one

can say is, "Well, there is something relevant
to inquire into here but we still don't know,

at this stage, whether we are within the realm

of section 92".

So, Your Honours, we submit then, going as it were to the affirmative, paragraph 5 ot

the outline, that a law is protectionist if its

object is or its objects include the giving of

an advantage to local traders over their

interstate competitors. If it is an overtly

protectionist law that will appear on the terms

of the law. In all other cases a wider range

of matters and a further inquiry is needed.

And we submit that the object of a law for these purposes is ascertained from the direct effects of the law but I do not seek, by that adjective

"direct" to reinstate a rigid concept of direct

as against indirect, immediate as against remote.

C 1 T24 /1 /NO- 144 31/5/89

Cast lema ine ( 2)

McHUGH J: It is very difficult, is it not? Supposing

you had a law in South Australia that nobody

could sell milk which had travelled more than
50 miles from a dairy farmer to market; that

would undoubtedly unfairly burden interstate

milk but how would you tell what its object was?

MR DOYLE: Precisely, and so I accept that the word

"direct" could seem as if I am endeavouring to

reinstate discredited notions and I an not.

It is simply a search for a word that indicates that one's concern is - one could substitute

the "more immediate" the "more obvious" effects
and, in my submission, in the end, no amount
of reasoning or searching for words will avoid

of its own and, again, I accept that. But, in the Court having to make some kind of judgment

my submission, once again, one should approach
the matter on the premise that - if I can put

it negatively again - the objects of a law cannot

be equated with all of its effects, otherwise

the notion of object of a law, in our submission,

becomes almost meaningless.

And we would submit when one applies our

approach to the present law that without deciding

the case one can very easily start by saying,

"Well, the objects of this law are litter control

and are energy conservation." The issue as between

us is really, "Is there a further object?", and

that is not a simple·inquiry but, in our submission,

one should not approach the inquiry by saying,

"Well, if the effect on the plaintiffs is

reasonably obvious and was foreseen then it becomes

an object.", but we have not been able to express,

in terms, an intellectual or analytical concept

that makes that sort of inquiry that can be answered

in that way. The Court then has to look at the

facts and make some kind of assessment which

it is not easy to express in precise terms which

will enable it to decide whether the effects

which one would not deduce, as it were, from

the terms of the law or from knowing what the

legislators saw as the mischief, whether those

effects must be so regarded that, in the end,

one says, "Well, whatever the minister said about

it in Parliament, these effects must be regarded

as objects of this law".

(Continued on page 146)

C1T24/2/ND-	145	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And, in our submission, that is the

sort of inquiry which must be embarked upon, and

jumping ahead for the moment, just to give what

is our, as it were, answer to that, before

explaining how we get to it, perhaps if

Your Honours could look at paragraph 11 of the

outline, we try to express it in one way there

that a law which discloses no protectionist

object on its terms may be protectionist if

the law has the effecta, both advantage and
disadvantage, and then, is not reasonably capable

of being regarded as a means of achieving the

suggested non-protectionist object.

In other words, when you look at it, you

say, well, that law will not achieve what you

are setting out to achieve, you must have been -

and I am putting it in a language which is more

purposive than the legal argument accepts -you

must have been up to something else, as it were,

or the other way you may approach it is you say,

well, there are other ways of doing thi~ that

were so obviously more appropriate, that the way·
you have done it indicates that your means of

getting to the end must themselves have been an

object.

And again, it is not easy to find the right

word, but when we say obviously available, our
submission is, in South Australia one would hardly

say that switching to the New South _Wales system

of litter control in a completely different way,

was so obviously available and preferable as

a means of litter control, that the local

parliament should have done that, and by not doing it,

bas indicated some alterior objective.

And so, we submit that is the_ sort of inquiry - a slightly different attemp.t in

paragraph 12, - that it lies in the imposing of

a discriminatory disadvantage on interstate trade,

conferring a competitive advantage, which cannot reasonably be related in the sense explained to the pursuit of a non-protectionist policy. In

other words, that when you look at what is done,

you say, well, bearing in mind that you just will

not achieve what you want to achieve, or bearing

in mind that you have, as it were, gone to the

village church via the moon, you could have done it

so much more simply, and with no significant effect
on interstate trade, you may then conclude, well,

the way you have done it does indicate that that

was one of the object~ 0£ the law.

CIT25/l/CM	146	31/5/89
Castlemaine(2)

DEANE J:	Mr Solicitor 8(d) is critical to your submission,
is it not, for the purposes of this case? What
I suggest to you is that the word "capable" cannot

be justified - - -

MR DOYLE: That is too stringent or

DEANE J:	You must have something like -I think what the
Court has been using in this field is appropriate
and adapted.

MR DOYLE: Yes, Your Honour. Without, as it were, resiling

right now, I accept broardly, with respect, what
Your Honour says, that - and I would not argue

that if the law could conceivably, possibly to

some tiny degree achieve the objective that then

it is safe, I accept that that may be too

stringent a test and that'appropriate"may be

preferable, although Your Honour, if"appropriate"

were there, in my submission, it is important not

then to start on an a~proach which means that this

Court decides what is 'the appropriate:' it is

essential that, in my submission, that what

Parliament did is merely seen as, an appropriate

way.

DEANE J:	Because, what you say as could not reasonably be
regarded, not whether it is or is not.
MR DOYLE:	Yes, I accept that, Your Honour.
DEANE J:	Is  not, then, in one sense, the critical problem
in this case, in the legal question, whether what
you say .in· (d). is right, or whether the true test
is whether the protectionist effect is merely
incidental or whether it is itself, when looked at in the light of the facts, an .object which has been
positively pursued? In other words, it is one thing to burden interstate trade in the pursuit of an environmental or conservationist object, if that is all that is involved, but you cannot take
advantage of your environmental or conservationist
object, for the purpose of pursuing the object of
burdening the interstate trader.

(Continued on page 148)

CIT25/2/CM	147	31/5/89
Castlemaine (2)

MR DOYLE:	Your Honour, I accept, with respect, the second
part of what Your Honour put to me, that is,what
Your Honour put to me in conclusion there, provided
one interprets "object" in the sense in which we
seek to interpret it, and, in my submission, that
proposition that Your Honour put to me at the end there is not inconsistent with anything we are submitting to the Court. However, Your Honour
began by saying, "Is it on the other hand a question
of whether the effect on interstate trade is merely incidental to the achievement of the local object?".

In our submission, that sort of formulation

is not of much assistance because it then requires

a consideration of how one distinguishes an

incidental effect from a non-incidental, and carries

with it a notion that, however genuine your pursuit

of the local policy is, it conveys the notion that

if it is going to have an obvious effect on interstate

trade, you cannot do it; that you can only do it when

it is, kind of, by the by. And we submit that is not

the right approach.

DEANE J: Well, now take this case and presume you can look at

the second reading speech. One thing would be if

the minister got up and said, "This is all justified and

six cents per bottle on the non-refillable is Justified, but we are going to take advantage of this

to keep Bond out, and we are putting on 15 cents

per bottle.", that would be one point of view.

Another would be if he got up and said, "Fifteen cents

a bottle is completely justified. A side-wind of that is that Bond is going to be kept out. Personally I am

pleased about that, but really that is not why we are

introducing it, and that is the right conclusion."

The distinction, I would have thought, is fairly clear.

MR DOYLE:	Well again, with respect as to the second, we would
agree with what Your Honour says, that in that situation the fact that he is pleased that the
plaintiffs will not get into the market is neither
here nor there. As for the first situation, if he said, "Well six cents is enough for our purposes, and
we are making it 15 simply to keep Bond out.",
without wanting to seem unduly rigorous, we would
submit that that in itself was not decisive, because
if the facts showed that he was quite wrong and that
to, in truth, achieve what were the apparent objectives of the law the 15 cents was required, while it would be
a difficult decision to make, one may well in the end
conclude simply that the objects of the law are not
what he says because the Court obviously does not,
in my submission, approach the matter on the basis that
as long as the minister says the object clearly enough
the Court now has got the answer.  But I agree, with
respect, and we accept, that if the minister said that,

ClT26/l/FK _	148	31/5/89 -
Castlemaine(2)

then unless there was some reasonably clear facts that

showed that the pursuit of some other non-protectionist

policy required the 15 cents, one would come to the

conclusion the law was bad.

But, in our submission, even if you did not know

the minister had said that, it is likely that the

absence of the facts would lead you to the conclusion

anyhow.

DEANE J:  I said the minister said it simply to, as it were, make

the identification easy.

MR DOYLE: Yes. Your Honours, we accept that, in a sense, perhaps

the most rigorous test for our approach is to

postulate that the minister stands up in Parliament

and says, "We are bringing in this law to control
litter, to conserve energy and to keep the plaintiffs
our of the South Australian market.", and obviously
then it becomes a difficult decision. Is the third

an object of the law in the sense that the defendants

contend? And we would submit that, in that case, still

on these facts, one would conclude "no", but obviously

this is in this grey area, that if the minister had

said that in those terms one would think long and hard, because in the end in this case, we have an

effect on the plaint~ffs which the defendant

acknowledges was known at the time of the law, and it

is not easy to say why South Australia calls that

not an object of the law, and why, on the other hand,

it calls litter control an object, and we acknowledge

that in there again there is an element of impression

in this.

DAWSON J:	We are not really concerned with litter control, are
we? We are confined really to conservation of resources and environmental reasons on the - - -
MR DOYLE:	Differential. We are, Your Honour, but, with respect,
we urge Your Honours to, as it were, keep the whole
picture in mind because the two are interlocked and
some of the things in the law serve both purposes.
That is, a return system serves both purposes,
conservation of resources and litter. The deposit
differential, we acknowledge, does seem to serve
only one purpose; discouraging the particular container with a view to promoting conservation of
energy.

(Continued on page 150)

ClT26/2/FK -	149	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  Your Honours, we submit that

the object of the law is to be identified by

considering what I have called its direct

effects but, as I put to the Court a moment

ago, I do not draw some kind of rigid a priori

distinction there, we do submit that the more

important things to look at are the direct effects

and we would characterize the effects on the

pla1ntiffs here as either, if you like, rather

indirect or relatively remote, without in any

sense suggesting that we were not aware of them

when the law was enacted - using "we" there as

if I were the legislator.

McHUGH J: Before you leave paragraph 8(d), I am not

quite following your argument. Why is it necessary

on your argument to have the "unless" clause

in paragraph 8(d) when the hypothesis that

subparagraphs (a), (b), (c) and the first part

of subparagraph (d) operate on is that the law

has an object or objects which are not protectionist,

but nevertheless it does an adverse effect on

interstate trade. From what you were putting earlier

I thought that that was all you needed to put, but

then you have this "unless" clause.

MR DOYLE:	Your Honour, we acknowledge that one has to go
further because,however one comes at it, there
may be an adverse effect on interstate trade,
there may be an improvement to the competitive
position of local traders, the law may, on its
face, have objects which are not protectionist but you may still have to inquire further. If I could use the example, say, which featured
in the conv2~tion debates of South Australia's
ban against ·,1ines containing phylloxera. At a time - could I put it slightly differently?
We will assume South Australia bans the import
of vines, and the facts tell the Court that that is related to disease in vines. If that is a
problem at the time, one would say that this
law does affect interstate trade in vines
adversely, keeps it out; does advantage local
producers of vines, gives them the market to
themselves; does have an object which is not
protectionist. But if, on the other.hand one
that in truth disease was not a problem at
the time, one might say a law
which simply bans imports of vines,as distinct from banning imports of diseased vines, looks
very much like a law which is, as it were,
concealing its real object.

McHUGH J: That is a concession then that a non-protectionist

law may offend section 92.

MR DOYLE:	No, Your Honour. Again, I do not want to seem
pedantic.  We would submit that you cannot decide

CIT27/l/JM	150	31/5/89
Castlemaine(2)

unequivocally that a law is protectionist or

A, Band C, and if it gets through steps A, Band C,	non-protectionist just by going through steps
we could say prima facie it is valid, if you like.
But we acknowledge that even though it gets through steps A, Band C you may be able to show
in the factual picture that there is something
more to be looked into. We would put this case
really in that - no.

McHUGH J: Supposing you had an agricultural State,

basically a __ non-manufacturing State, that said,

"We don't want anybody in this State to eat

canned goods, therefore we'll ban all canned

goods." What would be the position there with

section 92?

MR DOYLE: It would, unfortunately, depend on the facts,

but one might say, "Paragraph 8(a), yes,

it has an adverse effect on interstate trade.

Paragraph 8 (b) '-' - if you regarded the local foods competitively then you would say.- "Yes,

it does advantage the local traders". Then

you would have to ask yourself: does it have

objects which are not protectionist? In that
short example I am not sure myself what
objects could be identified of a non-protectionist
nature but let us assume that the local parliament,

on the basis of material before it, believed that

canned goods were harmful to health.

(Gontinued on ~age 152)

CIT27/2/JM 151 31/5/89

Castlemaine(2)

MR DOYLE (continuing): Then, in our submission, prima facie,

the law is valid but we accept that you would not

ordinarily stop there and say, as a matter of law,

no further inquiry can be made. So, we accept that

for this case, even though we would say the law only

affects particular individuals engaged in the trade

- well, no, perhaps I cannot really fit this case

readily as an example of the point I am seeking to

make here.

If I could just say again that we acknowledge

that, at times, a law can get through A, Band C as

it were but that a further inquiry might demonstrate

that the law was, in truth, protectionist because it

will show you that either because of the way

Parliament has gone about achieving the relevant objective or because the law cannot reasonably be regarded as appropriate or capable of achieving it - - -

McHUGH J: That means because of the effects on the law,

does it?

MR DOYLE:  Yes, you certainly have to look at the effects.

We do not deny that, Your Honour. We deny that

effects are always to be equated with objects of the

law; that something more is required before an effect

is regarded as an object of the law; but we do not

for one moment deny the relevance of the effects of

the law but we do seek to say that the more important

effects are the more direct, more immediate ones compared

with the, what we would contend are here, the

remoter effects.

DAWSON J: That comes very close to Mr Jackson's test of whether

the law is more protectionist than not.

MR DOYLE:  Yes. Well, we differ, with respect, from that only

in the sense that we submit that, if a law has certain

objectives, it is impossible, really, to say, "Well,

it has got certain objectives but",on an almost"but

for'test, we would really say its real objective is

or that it is more this or more that. That, in our	submission, is something that probably is almost
incapable of decision except in a few cases where
one might be able to ascribe to a law, a predominant
objective or a single predominant character.

So, while we define "objects" relatively

narrowly, we accept that if, so defined, one of them

is protectionism, then the law goes, even it one can

say, "Well, the others were genuine and valid objects".

ClT28/l/SH-	152	31/5/89
Castlemaine(2)

Your Honours, we submit, coming back to

paragraph 5 of the outline,because I had jumped ahead	to try to give, as it ·were,· :i.IIIrediately, the answer to the
issue raised by paragraph 5, tnat the Court is concerned to ascertain or identify the objects of
the law and we do submit that motives of individual
members of Parliament and, indeed, even ministers,
are irrelevant but as my friend himself has not
sought in any significant way to advance an argument
along those lines, I will not seek to develop it here
except to repeat my earlier submission that use cannot
properly be made in this case of what the relevant
minister said in debate in committee.

So, in our respectful submission then, going to

paragraph 8 of the outline, the inquiry one has to

embark upon and, in a moment, I will endeavour to

apply this to the present law - at the moment, I

am really seeking to indicate to the law the type

of approach we submit is the right one - first of

all, one does look to see if the law has an adverse

effect on interstate trade as such and not just

individuals engaged in the trade and, once again,

those words "as such" obviously carry a bit of

weight and I do not suggest that that is, again, a

rigid, as it were, intellectual line but one is

looking for effects on what one might call "the

trade", not just some of those who engage in it.

So, it is not a simple volume of trade argument,

in our submission. The volume of interstate trade

may diminish or be restrained or limited as a result of a non-protectionist law and so the mere fact that you have identified an effect on the volume of trade does not mean that you have even, as it were, presumptively identified a protectionist law. Then, in our submission, you have to find an

improvement in the competitive position of local

traders as against interstate competitors and, again,

in our·submission, it is clear that a product standard

which applies equally to locals and out of State traders

may produce no such effect. It can obviously affect

them all or burden them all equally.

ClT28/2/SH _	153	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  And the other point we would seek to

make, although it is not of particular importance

for this case,is that you may find a law which

does significantly burden or perhaps even prohibit

altogether a particular trade from one State

to another but, in our submission, if there is

no competitive advantage to local traders then

the law cannot be protectionist and it is important,

in our submission, to bear in mind that the two

must be there: both the imposing of the disadvantage

and the conferring of the advantage.

It is also our respectful submission, just

repeating the point made earlier, that one does

not in these two steps engage in some kind

of wane of the respective advantages and disadvantages.

Could I make one other point, Your Honours, which

may be important in this case. In my submission,

one cannot say, either, that one has to identify

a specifically local benefit. There were hints

of that in my learned friend's argument yesterday

and, in particular, the proposition which we
do not deny, that if the bottles are made in
another State then no South Australian resources

are being wasted so, as it were, why worry and

this proves that the law is protectionist.

If I could give an example taken on slightly

different facts; if one postulated that in

South Australia there were either no people producing

products which contained chlorofluorocarbons which,

I think, damage the ozone layer and parliament

enacted a law which prohibited the production

of such products, or the selling of them, thereby

preventing interstate producers selling them

in South Australia, or one could vary the facts

and assume that they were being produced in

South Australia, that as soon as the law was

passed production ceased and so, in a sense, we have

a relatively comparable situation. The local

producer adjusts to the law, the interstater

on me - it is protectionist", and it could be	says, "Well, this law is now bearing entirely	said, quite fairly,"Wl:lat difference to the ozone
layer will it make whether South Australia does
or does not ban the sale of products with
chlorof.luorocarbons in them?"

In our respectful submission, while in one

sense it can be said South Australia cannot legislate

for the welfare of other places, one cannot and

must not turn that into the converse, that a

South Australian law will be protectionist unless

its objects are purely local objects because,

in our respectful submission, in a federation,

if the South Australian Parliament thinks that

the question of the ozone layer is so important

that a law of this type should be enacted, its

ClT29/l/SDL	154	31/5/89
Castlemaine(2)

inability to demonstrate local benefits is, in a

sense, neither here nor there. One still engages

in the sort of inquiry which we have postulated

here but one does not say that because

South Australia's contribution to the ozone layer

is imperceptible that the law must be protectionist.

So, in our submission, it i9 no answer here to

say, "Well, 'these bottles are going to

be made in Queensland, Victoria and Western Australia

and therefore the supposed local object is just

an illusory one", or "therefore, in the relevant

sense the law cannot be regarded as capable or

appropriate of achieving its objects".

In my submission, one should not approach the matter on the basis that the object has to

be that local benefit and the parliament can

legitimately say, "Well, in effect, there is an

element of setting a standard here and we want

to show that in this State we are opposed to

wastage of that type.".

So they are the first two steps and then

at the third step, in our submission, one has

to look more broadly and under paragraph (c)

one looks to see whether the law appears to have

objects which are not protectionist. Could I

just make one other point, I am sorry to go back,

but if one fixed _too rigidly on the requirement

of a local benefit or took too much notice of

inconvenience to interstate traders, the other

consequence of that would be, in any federation,

probably, that gradually the trading conditions

in the federation would be reduced or raised,

whichever you like, to those which prevailed
in what was the biggest market in the country

because one could suggest, in my submission,

quite reasonably, that if New South Wales had

enacted a law like the South Australian law,

refillable containers would be the predominant

container in the market.

(Continued on page 156)

C1T29/2/SDL	155	31/5/89
Castlemaine(2)

MR DOYLE (continuing): Maybe. I should use a different product

rather than liquor, perhaps something relating to

motor vehicles. And, again, in my submission, this

comes back to the point we made earlier, one has to

be careful not to approach the matter almost with

an unconscious premise that the section is there to

enable this uniform course of trade or free movement
of goods around Australia. It is there, in our

submission, and relatively narrowly drawn, to allow

the local parliaments to pursue local policies

provided that their real object is not the disadvantagini

of those who trade from another State. And it does not

matter, in a sense, at all that the pursuit of those

local policies does disadvantage such people. The

question is; what was the object of the law,

So, we submit, then one comes to that final

balancing and, we submit, that it - I should not have

said "balancing" - that final consideration. Can the

law reasonably be regarded as capable

of achieving a non-protectionist object or, on the
other hand, has it chosen means to achieve the object

which are unreasonable in the sense that the same

object could so evidently be achieved by other means
readily available which would have no significant

effect on interstate trade. And if one answers in

the affirmative to those thal, in my submission, it

is looking as if the law is protectionist. I do not

suggest that is the absolute end of the inquiry but,

in our submission, that is the relevant inquiry to

be made at that stage.

Before I then go to apply our test, as it were, or

our approach to the particular legislation, just one

other point on the .American approach. We do submit

that it is not part of that test to engage in

what I have called the PIKE type of balancing, that

one does not, at any stag~ in our approach balance

the worth or value of the local policy against the

disadvantages inflicted on interstate trade. We

express that approach, can be put to one side and	submit that the .American cases, in so far as they	that the .American cases really proceed on a very
different basis. And so while at times, when they
talk about protectionism, they are useful in seeing how another court has grappled with the issue, their use does not extend beyond that.
The .American cases, in our submission, clearly proceed from the commerce clause. That is a clause
which is read, as we understand the .American cases,
as marking out an area of exclusive control for Congress. In other words, interstate trade is
exclusively the legislative province of Congress. function of which is to divide areas of responsibility
and is a clause which does in fact have the wider
· purpose which I , in my submissions, deny can be

ClT30/l/DR	156	31/5/89
Castlemaine(2)

attributed to section 92. I do not ask for Your Honours

to get the case but it was expressed very conveniently

in one sentence in HUNT V WASHINGTON APPLE ADVERTISING

COMMISSION, 432 US 333 at 350, and I will just read

this single sentence. Their Honours said:

Rather -

this is at the bottom of the left-hand page,

when such state legislation comes into conflict

with the Commerce Clause's overriding requirement
of a national "common market", we are confronted

with the task of effecting an accommodation of

the competing national and local interests.

And what Their Honours are there saying, in our submission, is that, first of all, the function of

this clause is the achieving of the national common

market and so it has a much broader function. On

the other hand, as the cases indicate, the ability

of local laws to affect interstate trade is such

that if that policy were pursued rigidly the State

power to legislate on what the Americans call
police matters, would almost evaporate. As a matter

of necessity, their clause being one which allocates areas of responsibility, they approach the matter on

the basis that if the State is legislating for a local

or police matter, then provided the effect on interstate
trade is insignificant they will do some kind of
balancing and if it is insignificant they will allow

the State to pursue its local policy.

But the point is, in my submission, they are

engaged in quite a different sort of exercise because

they are deciding whether the State is trespassing

into an area of Congress concern to an extent that

cannot be allowed, having regard to the fact that

this is an area which is exclusively Congress's

concern.

(Continued on page 158)

ClT30/2/DR	157	31/5/89
Castlemaine(2)

MR DOYLE (continuing).:  And so it is a very different

inquiry leading to different approaches and that

is why, in our submission, while the American

cases can at times be used to illustrate points

one cannot rely on them to provide a test and

the other thing about the American cases which

emerges very clearly from the commentators is

that in this area the Americans in fact have

several tests which are deployed depending on

the sort of fact situation which is thrown up.

And so, again, one has to bear in mind that they

are applying what I think some of the articles

call a multifaceted approach and, furthermore,

it is overlaid with considerations under the

equal protection clause and the rights and

privileges clause.

And so our broad submission is that at

times there are useful things to be gleaned from

the cases and at the end of my submissions I

want to make one or two points on them, using

them, as it were, as convenient ·comparisons to

test our test but that, apart from that, one

should not adopt the American approach and, in

particular, there are good reasons of law why

the PIKE balancing approach should not find a

place in our approach to section 92.

BRENNAN J:  Do decisions of the European court have

anything of assistance to offer?

MR DOYLE:  Not, Your Honour, so far as we are aware. We

do have one case here which, perhaps, I will

provide to the Court now but we really provide

it, somewhat apologetically, just as some further

interesting material and as showing how, within

the European community this very same problem

of beverage containers and litter has raised

similar issues of protectionism as against the

interests of a common market but this is the

only case we are aware of which discusses the

problem in any detail and the method of analysis

is not one which we suggest provides any guidance

here.

The case itself, I am not sure how correctly

to cite it but, in effect, it is the COMMISSION

OF THE EUROPEAN COMMUNITIES V DENMARK with the

United Kingdom su2portin3 thecommission and attacking

Denmark laws which, in effect, were aimed at

either excluding or disadvantaging non-refillable

beer containers.

BRENNAN J:  I do not know whether you have a reference

to the recent SAUSAGE case which attracted some

press publicity but it seemed tome to raise the

same sorts of problems.

C 1 T3 l /1 /ND	158	31/5/89
Castlemaine(2)

MR DOYLE:  No, I do not to that, Your Honour. Was that

in the Economist? I did read a short article in the Economist which, as it were, commented

on the Denmark case and said there were other

problems of this type but that was the only - - -

BRENNAN J: There is only one proposition I can advance

in relation to that matter and that is that if

it is in the Economist I have not read it there.

MR DOYLE:  Your Honours, could I go then to endeavour to

apply our approach to the laws in this case and

so having touched on these points earlier I will

not at this stage of the submissions go over.
again paragraphs 9, 10 or 11 or 12 of the outline,
perhaps just invite Your Honours' attention to

paragraph 13 where we try to say negatively what

our approach ,is not.

Your Honours, I go then to the 1975 Act

because although amendments have been made and

the sections under particular attack are sections

which were inserted in 1986, my submission is

that primarily we are concerned here with a law

enacted in 1975, amended, as I would submit.to

tighten the scheme in 1986 and that it is wrong,

as a matter of approach, to look at the 1986 amendments in isolation. What we have to do

is approach this as a 1975 law which has been

amended along the way.

(Continued on page 160)

ClT31/2/ND-	159	31/5/89
Castlemaine(2)

MR OOYLE ( continuing) :  And so, my first approach and submission is that

it is quite proper to test this in terms of

circumstances in 1975 because unless an

argument is advanced,as it does not seem to

have been advanced here, that a law valid when

passed will become invalid for protectionist

reasons because of changes in the circumstances

then, unless such an argument is advanced, if the

law in 1975 was valid, it remains valid.

Now, in this particular case, my submission

will also deal with the 1986 sections and I do not need, in my submission, to go so far as to

assert here that a law, initially valid, could

never become invalid because of changes in facts

but I do simply invite the Court's attention to

the fact that, if my premise is right, that it is

the right approach to approach this as a 1975 Act
then,in reality, if my first argument is sound,

that in 1975 it was not protectionist, the argument

against me really has to be that it became

protectionist or that it is proper to look in isolation at later amendments and in some way

regard them as protectionist, even though the

law into which they are fitted, and whose purposes

they serve, is not a protectionist law.

And that is why I go back to the 1975 Act to begin these submissions.	lhe first submission -we
make as to	the 1975 Act is that it could not be

regarded as what we have classed as an overtly

discriminatory law. On its terms it imposes no discriminatory burden on interstate trade and so

we can safely say, in our submission, that it is

not in that catagory.

Your Honours, I will not go back through it

now but I would, as it were, notionally put in
here again, from our submissions on the facts,

our precis of what the 1975 Act did in terms of

making refund amounts compulsory for containers,	specifying a five cent deposit,and so forth. In
our respectful submission, when one looks at what
the 1975 Act does aided if necessary by reference to the second reading speech to identify mischief, although we submit that is hardly necessary, one
can quite clearly say that litter control and
resource conservation, by discouraging non-
refillable containers, are the objects of the
1975 Act.

CIT32/l/CM	160	31/5/89
Castlemaine(2)

MR .OOYI.E (continuing):· On our approach, perhaps using paragraph 8

as the examole, we have said it is not overtly

discriminatory so we come to paragraph 8 and, in

answer to (c), we have said, "Well, it does have

an object or objects which are not protectionist"

and, in our submission, in answer to (a), one would

say, "Well, certainly on its terms, there is no

adverse effect on interstate trade or even

individuals" and, in the light of the facts as

we know them, quite apart from the terms, there is
no adverse effect on interstate trade because there

is no fact before this Court which suggests that in 1975 the South Australian legislation disadvantaged

interstate traders and gave thereby a competitive

advantage to local traders. The facts indicate that in 1975 the trend to cans and non-refillable bottles

was a general trend and occurring in South Australia

as well as elsewhere and it was the Act which stopped

it in that State.

So, our submission is that, applying that approach

to the 1975 Act, one comes to the conclusion that the

law has non-protectionist objects; there is no

indication of an adverse effect on interstate trade;

no indication of an improvement of the competitive

position of local traders and, therefore, prima facie,

the law is valid. Then, in our submission, if one

wants to make a final check, looks at whether the

law was capable or could reasonably be regarded as

capable or appropriate of achieving its objects-and

one would say, in our submission, yes - then one says,

"Well, do the means chosen in some way either inflict

or are they likely to inflict disadvantage on

interstate traders which could be avoided by some

obviously more convenient or more readily avai1able

approach to the problem"? Our s>lution	is, clearly,
no.

(Continued on page 162)

ClT33/l/SH -	161	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  We submit that one can come to

a very firm conclusion that the 1975 Act was

not a protectionist Act and that there is

simply no basis for asserting the contrary.

Then if we come to the 1986 Act and

Regulations, in our respectful submission,

if one accepts the earlier submissions made,

one comes to tte same conclusion because if one

accepts that all that happened in 1986 was

tighter control over refillable bottles -that

in no sense speaks of protectionism; restoring

the 1975 relativities in deposit levels -that

in no sense reflects protectionism because it

is just doing exactly what was done 10 years ago

and pursuing the same policy; thirdly, bringing

in wine cooler bottles, which has no indications

of protectionism about it because the facts in the special case indicate that it had an equal

impact on local and out of State traders; and, other than that, simply some tidying up of the

legislation. So, in our submission, on that

approach, and looking at it in context, one would

come again very readily, in our submission, to the
conclusion that the legislation is not protectionist.

However, obviously for present purposes, I should then turn to the more confined inquiry and, as it were,

putting the history aside, as I say one should not

do, and looking at the 1986 provisions in isolation,

do they disclose protectionism, either because

of the means chosen, or the inability of the law to -

or becaas.e one could not reasonably regard the law

as appropriate to achieve some non-protectionist

object.

(Continued on page 163)

CIT34/l/JM	162	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  Now, as to that, our respectful

submission is that when one goes to the facts,

that first of all we acknowledge there is an

adverse effect on some of those from out of the

State who wish to trade in the State, namely the

plaintiffs in particular, because cans and

non-refillable bottles are widely used by them,

they are discouraged in South Australia - I again

just remind the Court that as to cans there is

no difference between the local producer and them;

it is only in one aspect of the market, non-refillable

bottles.

However, although there is an adverse effect,

first of all, that is not by reference to something

which is linked to them being in interstate trade.

It is not linked to them being a trader in another

State. It has no relationship to any natural

advantage enjoyed by interstate traders. So, however

one looks at it, there is nothing in what is done

which, as it were, smacks of protectionism in the sense

of it being a means which, in its nature,indicate8

something aimed at those who are trading interstate.

And, it has no relationship to anything which

distinguishes interstate goods from local goods. It
operates by reference to a method of trading which
is used almost exclusively by the plaintiffs but,

on the other hand, it is not used by another

interstate trader, CUB, and, again, one can point to

the fact that there is no attempt, or no apparent

attempt, to discourage that interstate t~ader from

the market and that interstate trader has found it

worth its while to use the preferred type of

container and has gained what, on anyon_e' s teIT.J.s

is a very significant segment of the local market.

(Continued on page 164)

ClT35/1/JH	163	31/5/89
Castlemaine(2)

MR DOYLE (continuing):  So, in our respectful submission,

it is, picking up one aspect of the American

approach, fair to say here that there is no barrier

to interstate trade as such. One can fairly

say that here there is a barrier to those who

wish to trade from another State using a particular

container. And I do not suggest that means that

is the end of the inquiry but I submit that it
is significant if one can say it is not a barrier

to interstate trade as such but only to certain
people who wish to trade in a certain manner.

And so while one must, as it were, ask more questions, in my submission, at this stage

there is a favourable and relevantly favourable

answer to the inquiry as to the effects of the

law.

DEANE J: Mr Solicitor, is there any explanation of Sb

being confined in the way it is other than

discrimination? I mean, why should not you allow

both refillable and non-refillable containers

to- have collection depots instead of having to

go to the particular retailer? If I can follow it

through, if the collection depots are not going

to be as effective then why should not the

refillables go to the.retailer to stop litter?

If the collection agents or depots qre going to

be as effective, why preclude the non-refillable

except to discriminate? Perhaps you might like

lunch-time to identify the reasons. I have been

thinking about it; it is hard to see any.

(Continued on page 165)

C 1 T 3 6 /1 / ND- 164 31/5/89

Cast l ema in e ( 2)

MR DOYLE:	Your Honour, on that cautionary note perhaps I had better use the lunch-hour rather than rush
into an answer. I would just make one point first of all, if I could, and that is that -
and I am obviously labouring the history of the matter - when we look at it in context we find it is, in fact, a narrowing of the favourable
treatment to refillable containers and in this
area matters like that may be significant.
In other words, the answer may be different if it were done for the first time rather than, as happened, by way of contracting an immunity.

DEANE J: I follow that but, just looking at it now - - -

MR DOYLE: 

Yes, I would like to think about that over

the lunch-hour because I am not completely f ami 1 iar
with all the things in the special case and I

would rather get it right than guess. So if

I could come back to that straight after lunch.

First of all, my submission was one gets

a favourable answer at that stage. Then, in

my submission, one has to bear in mind the fact

that to the extent that the law does have a different

effect on the plaintiffs it has it because of

a marketing trend which has been opposed by the

South Australian Parliament since 1975. Now,

that does not make their opposition, as it were,

good. The submission is that it is not as if

this effect could in any sense be suggested as

having been selected to meet the interstate trader,

it arises because the interstate trader has followed

a trend for reasons that made good sense to itself,

to refillable bottles. It was a trend which

was opposed by the South Australian Parliament

through its legislation before there was any

significant in_terstate trade in this type of

container.

Once again, when one looks at the means,

we submit, examined that way, there is nothing

protectionist or smacking of protectionism in

discouraging the particular container. Would

that be a convenient moment, Your Honour?

MASON CJ:  Yes, it would. We will adjourn now and resume

at 2. 15.

AT 12.44 PM LUNCHEON ADJOURNMENT

C 1 T 3 7 /1 / SD L 165 31/5/89

Castlemaine(2)

UPON RESUMING AT 2.14 PM:

MASON CJ: Yes, Mr Solicitor?

MR DOYLE:	If the Court pleases, I just want to complete the
submissions, looking at the 1986 in isolation, just to
deal with a couple of matters first of all. Your Honour
Justice Brennan, we will endeavour to provide written
answers to those matters Your Honour raised before
lunch and we will do that as quickly as we can,
hopefully in a few days, that is both the points
Your Honour raised.
In answer to Your Honour Justice Deane - those questions relating to bottle costs and the like - just
in case this is relevant: the way we submit the facts
should be seen are that for the non-refillable bottle, the bottle cost is 16 cents which,I did not perhaps
stress adequately before, includes the deposit of
5 cents, so that brings you back to 11 cents as the
cost of that container. For the refillable bottle
it is 16.65 cents and, if one takes out 4 cents as
the applicable deposit, that brings you back to
12.65 cents. But, unfortunately, the way the facts
are expressed that includes what I might call the recurring handling costs each time it goes out and get refilled.

So, we do not, in the special case, have

information which enables you to arrive at what might
be, I suppose, the sort of"glass cost" of the bottle.

On the question of soft drinks which Your Honour

raised with me, if I could just add this, that the

beer and soft drinks are obviously different markets.

The minister in the second reading speech, from which

I read at page 180, said that there was no immediate

problem there and it is clear when one reads that

second reading speech tha~ as to beer, there was

a problem there and so to some extent. they were

dealing with a particular problem which had arisen

then. And he did say that they were going to have an

inquiry generally into the effects of the Act but

that while this case was pending there was no point

in proceeding with the inquiry.

(Continued on page 167)

ClT38/l/FK -	166	31/5/89
Castlemaine(2)

MR DOYLE (continuing): And that is said by him both at

pages 248 and 197 and so he perhaps seem, to accept

that there is some anomaly there and that is the

explanation he gives. As to section Sb, Your Honour,

and the question, "Well, why cannot non-refillable

bottles get an exemption from the point of sale

requirement?", our submission is that that is, in

fact, intentional because we acknowledge that the

point of sale requirement is some discouragement

because liquor retailers do not like handling them

and so it is part of the discouragement - the higher

deposit and insisting that they go back to the point

of sale.

Your Honours. returning then to those submissions

and looking at the 1986 amendments in isolation - our

submission is that to the extent there is an

improvement in the competitive position of the local

brewer, it is only because it had previously adapted

to the legislation, after 1975. and, obviously, if for
some reason it switched to non-refillable bottles

there would be no gain, or if Bond switched to

refillable bottles then subject to Bond's own costings

there are no gains in terms of the legislation.

We would also submit that it is a relevant fact that if there is a benefit to the South Australian

Brewing Company there is also a benefit to Carlton

United because they are both trading in the

South Australian market in refillable bottles. So

it cannot be said that it is a benefit which, as it

were, goes unerringly to the local producer. So

when one looks at the 1986 amendments in isolation,

we submit. that the same objects can be seen for those amendments, that is, litter control and resource

conservation, and if one then looks at the means

adopted and also considers whether the legislation -

those amendments - are reasonably capable of

achieving those ends, we submit that if you look at,

first of all, the power to exempt refillable bottles -

and, if anything, as I put earlier, more tightly	that is obviously related to the relevant objective -
expressed, so that now you get the exemption only if

you satisfy the relevant person that the arrangements

have been made.

Again the amendments indicate a reliance

on a long-standing system of litter control and so

there is no hint of protectionism in that and, in

our submission again, nothing disproportionate in

either the deposit differential which arose in 1986

or the insistance on point of sale.

ClT39/l/DR	167	31/5/89
Castlemaine(2)

MR DOYLE (continuing): Neither are new things but, again,

even in isolation in our submission, nothing
disproportionate, provided one accepts that it is
legitimate to prefer the refillable containers.

So, we submit that when one subjects the 1986 amendments to the sort of scrutiny we proposed in

paragraph 8 of our outline, that again one comes to

the conclusion that protectionism is not an object

of those amendments.

If I could just for a moment make a comparison

with the facts of COLE V WHITFIELD, not anything from the judgments, there the Court said that Tasmania was

entitled tc. exclude undersized crayfish from the

Tasmanian market. It said that, although the result

of that was to protect the Tasmanian stock of crayfish

and, in our submission, when one looks at the judgment

there is, first of all, no hint there that the Court

was balancing whether that was a worthwhile objective

as against, or compared with, the disadvantage

inflicted on traders from other States who had legally

obtained smaller crayfish. So, first of all, in our

submission, there is no hint in COLE V WHITFIELD of

any sort of balancing of the worth of the local

benefi~ preserving the crayfish stock, as against the

harm being done to the interstate traders. The Court,

in our submission, appeared to accept simply that is

a non-protectionist object; presumably the Court

reasoned that it was bona fide adopted by the

Tasmanian Parliament and that was the end of that

inquiry.

Having said that much, the Court then said that,

because it was impossible to tell where a crayfish
came from by any means, therefore, the size prohibition

was the only way of effectively protecting the Tasmanian

stock and, again, in our respectful submission, it can

be said here if one accepts that conservation of energy

and resources is a legitimate objective, the only

successful way of doing it is by discouraging or

prohibiting the use of containers which, in effect,
contribute to waste rather than conservation.	So,

once again, if one accepts that premise that the

object is a legitimate one, in our submission, whether

the law banned them or simply provided a very significant

commercial discouragement, it should be valid.

(Continued on page 169)

ClT40/l/SH	168	31/5/89
Castlemaine(2)

MR DOYLE (continuing): If one does not accept that premise,

in my submission, one can, as it were, almost

rhetorically say, "Well, why can't parliament

pursue that policy of discouraging non-refillable

containers? Is it because the resources aren't

scarce enough?", and if that is the sort of

inquiry then, in our submission, those who pursue

that line are really asking the Court to go into

policy areas that are for parliament. "Is it

because the resources involved aren't exclusively

South Australian?", and I dealt with that this morning and used the example of the law banning

chlorofluorocarbons. "Is it because parliament hasn't controlled wastage in other areas?" And, again, if that is the line of inquiry, in my

submission, again, it takes one into something

which is a matter for parliament and not for

the Court.

So, we submit that, again, those sort of questions highlight that, in a sense, if one

is to deny the premise that the discouragement

policy is a good one, one must come up with some
persuasive reason that does not involve the Court

moving into the area of policy which is the

parliament. If one accepts the premise, then,

in our submission, one cannot say there is anything
disproportionate about the way in which it is

pursued which causes one to say that the damage

done to interstate traders must, in truth, be

one of the objects of the law.

So, in the end, it is our respectful submission

that the question confronting Your Honours is

whether the objects disclosed on the face of

the Act, and having regard to the factual context,

of litter control and conservation of resources

are the real objects of the Act or whether, in

truth, preserving some of the market for the

local brewer is, in fact, another object of the

Act, albeit not disclosed.	And we would submit
that it is not.

Could I go then, Your Honours, briefly to

the American cases and I have prepared a short

written submission which, in the interest of

time, I will speak to very briefly, if that could

just be provided to Your Honours. And I just

want to draw a few points out of this. First

of all, as to the American and Canadian legislation

which we provided to the Court yesterday, we

really provide that simply to show that this

legislation is not some idiosyncratic South

Australian notion, there are other people with

similar concerns who, interestingly enough, pursue

similar legislative means to achieve them.

C1T41/1/ND 169 31/5/89

Castlemaine(2) (Continued on page 169A)

And, in our submission, while that sort

of material is of little assistance to the Court,

again one might, if one found a totally
idiosyncratic approach to a problem, one might
start to view it with some kind of suspicion.

As to the American material, Your Honours, could

I just make these points:

(Continued on page 170)

-

C 1 T 4 1 / 2 / 169A 31/5/89

Castlemaine(2)

MR DOYLE (continuing): First of all, paragraph 11.

If Your Honours would just look at paragraph 10,

our submission is that when the American Court

inquires as to whether a law is discriminatory,

as PHILADELPHIAVNEW JERSEY showed, it looks

to see if there is a burden, not on the local
trade and no reason other than the origin of

the goods to treat them differently. If that is

a sound approach to the issue of discrimination,

and it may'bein some situations, then, as we

submit in paragraph 11, on that approach the

present Act is not discriminatory at all and
the Americans, in our submission, would not

regard it as discriminatory.

• On its terms, it applies to both; in its

practical affect, we would sub~it that it is the

same on both local and out of State producers,

and the only difference arises because the local

producer has already changed, in answer to,

in effect, the economic pressures the Act exerts,

and that is the only reason why there is an

initial appearance of different impact. We would

also make the point in paragraph 12, as an important

one, that, in our submission, in the present case,

the plaintiffs are really relying on their

preference for a particular method of trading,

which is, in their economic interests, rather than

against anything which smacks to discrimination

against interstate trade as such.

In paragraph 14 we refer to the AMERICAN CAN

COMPANY case Could I ask Your Honours in particular

to consider, in due course, pages 697 to 703.·

Your Honours may find it helpful - I am not going

to read from it, but that was a case dealing with

American legislation dealing with the very same

problem of non-refillable containers. In a

similar way and the similar complaints being made, that out of State producers and sellers were being

were being advantaged, and it also dealt with the	disadvantaged and that local producers and sellers
problem of extra haulage distance ,which,in our submission, the Court correctly characterized as
something applying to anyone further from the relevant market and nothing to do with it being
interstate trade.

CIT42/l/CM 170 31/5/89

Castlemaine(2)
MR DOYLE (continuing): Paragraph 18, Your Honours, in our

submission, is another important point. In

TOOMER V WHITSELL, which my friend read from

yesterday, the Court said that the American court
would take into account the fact that the law
increased costs for interstate trade generally
and diverted to the legislating State employment

and business which might otherwise go to another

State. In paragraph 19 we submit that if that

is a helpful test, aeain there is nothing in

the present law, that is the South Australian

BEVERAGE CONTAINER ACT, tending to require

business operations to be transferred from other

States to South Australia. To be closer to the

market the producer might prefer to locate there
and see obvious benefits in doing so, but, in

our submission, if these plaintiffs are minded

to use refillable containers, there is no
incentive other than the obvious one of distance

to produce their beer in South Australia rather

than in another State, no increased cost imposed

on interstate trade generally, and the law itself

does not have a tendency to divert trade or

employment to South Australia, except indirectly

in so far as one can say, "Well, if its effect

is to hold the local brewers' market share", then I acknowledge then that would obviously mean some employment and business for the local

economy. But it is only an indirect consequence
and it is also one which flows to Carlton and

United Brewery and through that to the Victorian

economy presumably.

Paragraph 20, in our submission, if the relevant

test, or if a relevant approach is the PHILADELPHIA V

NEW JERSEY one, in other words, does the law impose only on the out of State traders the cost

of dealing with a local problem, again, in our

submission, it does not because it imposes all the

same costs on the local producers as are imposed

on the out of State producers.

They are the only points I wish to stress in

particular. Our fundamental submission is that

while sometimes the American cases provide approaches

which may be useful to deploy to a limited extent,

the overall American approach is so different

that no significant reliance can be placed on

those cases. They are our submissions, if the

Court pleases.

(Continued on pagel72)

CIT43/l/JM	171	31/5/89
Castlemaine(2)

MASON CJ: Thank you, Mr Solicitor.

DEANE J:  Mr Solicitor, what about the answers to the questions?

MR DOYLE:  Yes. One general comment: first of all, it may be

that Your Honours, on a certain approach, might

conclude that it is only the regulations which are
invalid but question (a) having gone, we would

submit that it is "no" to (b) and "no" to (c) but,

being a little more discriminating, we would submit

that, really, there is nothing protectionist about

sections 4, Sor 6 and that the real complaint lies
in the differential deposit which is contained in
the regulations and, in our submission, the power to

do that by regulations is not a protectionist power. The other complaint which we would submit must

be a much lesser one would be the inability of

non-refillable containers to be exempted from

section 7; so, in other words, I suppose the

provisions of section Sb(2). So, our submission

is that really there is nothing to be said about

sections 4, Sand 6 but in terms of the case

advanced an argument which might, if accepted, lead

to the invalidity of those parts of the regulations

which impose the differential deposits for beer

containers. So, they would be regulations 7(c) and

(d) and then, perhaps, also section Sb.

DEANE J: Well, it would not really be Sb, would it, in that -

or would it be section 7?

MR DOYLE:	Yes.
DEANE J:	We are not asked about section 7 - I am sorry, no,
I see.

(Continued on page 173)

ClT44 / 1/ SH -	172	31/5/89
Castlemaine(2)

MR DOYLE:	If section Sb were found to be invalid then it would
be difficult to confine invalidity, I suppose, to
that because it is clear that the ability to exempt
refillable containers is central to the scheme of
the Act.  So a difficult question of severance would
arise quite apart from just the mechanical point of
whether that is the real source of the problem.
DEANE J:	It is section 7 that imposes the burden.
MR DOYLE:	Yes. So, Your Honour, with respect, may well be right.
Perhaps it is section 7 that is the real problem.
We would argue further that no real criticism can be
made of the notice provided one accepts the practical
enforcement rationalethat we advanced this morning.
DEANE J:	One of the possibilities, and there are many of course, would be that invalidity was seen as flowing only from
the differential. Well now, if that was so, there is nothing that would revive here, is there?
MR DOYLE:	No, Your Honour. If they were held in -
DEANE J:	What I have in mind is if, for example, sections 4, 5
and 6 were invalid there would be something to be said
for the view that the sections of the earlier Act, or the sections before the '86 amendment would revive, but there is nothing that could be done in that regard in terms of regulations here, is there?
MR DOYLE:	In our submission, no, Your Honour. We have not put
a submission on whether if the 1986 sections went
the earlier sections would revive, but - - -
DEANE J:	I mean the point is - - -
MR DOYLE:	- - - 7 is a completely new one.
DEANE J:	- - - we have been looking at it as if it were two
Acts. There is only one Act.
MR DOYLE:	Yes.
DEANE J:	Am I right that it is not suggested that if one were
to say, "Well, the 1986 regulations were bad", that the earlier regulations would automatically revive.
MR DOYLE:	No, we do not suggest it, Your Honour, and, in
particular, if regulation 7 as a whole or if, in
particular, subparagraph (c) and (d) were declared
invalid, as I understand it, they were new regulations from 1986 and so there is nothing to revive.
DEANE J:	I see. They did not repeal?
MR DOYLE:	No, they were new.
DEANE J:	I see.

ClT45/l/DR	173	31/5/89
Castlemaine(2)
MR DOYLE: If the Court pleases.

MASON CJ: Thank you. Yes, Mr Solicitor for New South Wales.

MR MASON:  I hand up an outline of our submissions, Your Honours.

(Continued on page 175)

ClT45/2/DR	174	31/5/89
Castlemaine(2)

MR MASON:	Your Honours, we, in paragraph 1, put the very
broad submission that there is a dual requirement
to strike down legislation under section 92,
namely that there be shown to be discriminatory
effect and a proscribed purpose or object,
namely, this protectionist ground.  The difficulty
arises, as we perceive, because the Court accepts
that one can look at the legal and factual
operation of the Act and is not confined to any
criterion of operation theory.
We wish to say, just very briefly, something about the reference to the concept of equalization
as it emerged in the American cases and to put the
submission that you cannot take a proscription of
equalization to such a level as would deprive the States of their capacity to initiate distinctive
policies, and to give an example, if the New
South Wales Parliament decided to abolish workers compensation with respect to travel injuries,
that would not be per sea breach of section 92.
Let it be conceded that one might be able to argue in certain circumstances it could be, but per se
it would not be, certainly because there would be
a legitimate purpose, the reduction of costs in
relation to New South Wales industry. That, of
course, might have an effect upon the competitive capacity of New South Wales industry vis-a-vis
Queensland industry, for example, if the Queensland
law was not equivalent in the level of its protection it required for workers and the
corresponding level of premiums.

Let it be assumed that subsequently Queensland,

thinking it was a good idea, followed suit and

made a similar amendment. Our submission would be

that that per se would not amount to a breach of

section 92, even though on a simplistic equalization

analysis if one confines oneself solely to the legal

and factual operation of the legislation, it may be

said to have an effect upon the movement of trade

from Queensland to New South Wales. We would

submit that if those examples are accepted it
emphasizes the need to find a proscribed protectionist

purpose in all cases and not to look simply at the

consequences of a law.

In paragraph 2 we put the submission that

a law is not discriminatory against interstate

trade and commerce unless it denies equality of
trading rights to interstate traders. Perhaps

the thrust of the submission there is that one

looks at interstate traders as a class. It is

the interstate trade, and not interstate traders

which are to have the protection of section 92

and the mere fact that a particular interstate

trader shows that it has an impact upon its trade

CIT46/l/JM	175	31/5/89
Castlemaine(2)

does not establish a breach of section 92

even though, I reiterate, the legal and factual

impact of legislation may be enough to constitute

a breach of section 92. Our submission is that

on the material before the Court her~ the laws

that are challenged are not discriminatory in

the sense which the cases require and one does

not, for that reason, even get to a question of

examining the protectionist aspects of them.

(Continued on page 177)

CIT46/2/JM	176	31/5/89
Castlemaine(2)

MR MASON:	Paragraph 3, I think, does not really arise with the
force that·we expected it would, in view of the way
the case has proceeded, so, if I may, I will pass
over it to look at paragraph 4.
BRENNAN J:	Are you saying, if I could just take you back to

paragraph 2, that, in order to be offensive to

section 92, a law must be discriminatory against

interstate trade by reason of the fact that it is

interstate?

MR MASON:  No. I do not intend to encompass that in the submission.

What I am intending to put is that the mere fact that
an interstate trader shows an impact upon its business

does not, in itself, establish that the law discriminates

against interstate trade. This present law is

facially neutral and has an impact upon intra and
interstate trade, but it must be accepted that a

facially neutral law can offend section 92 if the

way the industry just happens to be functioning is

such that it must inevitably strike at an interstate

trader. What one thinks of the VACUT.J}'I OIL situation,

where a law that looks very innocent is obviously

directed at interstate traders because all petrol

comes from outside Queensland and only Queensland

makes sugar petrol.

I am simply wishing to put the submission that

the plaintiffs' case in this situation has stopped

short of showing that the South Australian laws

erect a barrier to entry into the South Australian

beer market, and they confine themselves to complaining

about the impact upon the particuler trader and regard

to the particular way it has geared up its own business.

BRENNAN J:  It may not be necessary for a law that falls under

section 92 to be directed against interstate trade

according to its terms, but must it be necessary for

that law, having regard to the circumstances in which

it operates, to select the interstate origin of the

trade which it adversely affects as the reason for,

or criterion of, its operation? Putting it another way, could Castlemaine Tooheys

complain if the law now under attack was enacted by

Queensland?

MR MASON:  My submission is that they could not. That example

shows, really, what they have established only shows

they have standing to make the challenge. It does

not show that they have made the challenge good.

The example Your Honour has put to me is one that,

perhaps, even removes the standing - am I right in

assuming that Castlemaine Tooheys is a Queensland

company - beer producing company?

BRENNAN J: Well, it used to be.

ClT47/l/FK	177	31/5/89
Castlemaine(2)

MR MASON:	Your Honours~ in paragraph 4 we address the situation
of object or purpose, that being the second leg that
must be satisfied in order to strike down the law, and in a way that I believe departs from that put by the plaintiff, and also by my learned friend, Mr Doyle,
we propose a different test for resolving the question
about a plurality of purposes. The plaintiffs'
suggested test is that it is a general balancing test
which, in our submission, is not helpful at any time
and is certainly unhelpful when one is not balancing
like against like.

(Continued on page 179)

C 1 T 4 7 / 2 / FK - 178 31/5/89

Castlemaine(2)

MR MASON (continuing):  My learned friend,Mr Doyle ,accepted

that if there were a plurality of purposes,

one of which was protectionist, then the law is

bad. Our submission is that . where there is a

plurality of purposes there is a well-established

way in Australian law to resolve that by the rule

that was applied in the SAMREIN case. I just take

Your Honours very briefly to that in 56.ALJR 678.

Your Honours may recollect that that was a

challenge to an administrative act, namely the
resumption of some land, where the land was

resumed by the Water Board for the purpose of

a joint development property that was going to be

constructed with money from the Government

Insurance Office, the top 20 floors of which

were to go to the GIO, the bottom 20 were to be

used and occupied by the Water Board.

It was argued that since the Water Board had

power to resume, for its purposes, but not for the purposes of the GIO, and since the GIO did not have power to resume, the resumption was

vitiated by an improper purpose and the test

the Court applied was one taken from THOMPSON'S

case, it is at 679E, in the right-hand column:

The attempted exercise of power will be vitiated

even if the ulterior purpose was not the sole

purpose of the acquisition; it will be an

abuse of the Board's powers if the ulterior

purpose is a substantial purpose in the

sense that no attempt would have been made

to acquire the land if it had not been

desired to achieve the unauthorized purpose.

Your Honours, in our submission, there is no

reason why that test is incapable of application

to delegate a legislation or to legislation

itself where that is liable to challenge under

section 92 for an improper object or purpose. It

is true that the test requires the Court to impose

a hypothetical question and one that is really

hypothetical and directed at the hypothetical
subjective intention of the law maker or the

administrative actor, but it does provide, in

our submission, a certain and satisfactory rule

to resolve this question of a plurality of

purposes.

Your Honours, at page 95 of the transcript

yesterday, my learned friend Mr Jackson appeared to accept that there was at least a good purpose

in the South Australian legislation. We make

reference to the American case of MOUNT HEALTHY

CITY SCHOOL and could I take the Court very

CIT48/l/CM	179	31/5/89
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briefly to that, in 429 US. for an indication

that that Court seems to accept a similar

approach to resolving the validity of actions

which are vitiated and yet have a good purpose

as well. A school teacher was dismissed for

two reasons: One, it was his inappropriate

behaviour towards students, clearly a proper

reason. The other was the fact that he, as it were

blew the whistle upon the principal by making	'
a complaint to a local radio station,	an

improper reason for dismissal, in view of the

right of free speech which the Court held that

he had, and the question was how the Court should

deal with his constitutional rights in that

situation.

And in the opinion of the Court, given by

Mr Justice Rehnquist, at page 285, about point 6,

His Honour said that:

A rule of causation which focuses solely

on whether protected conduct played a part,

"substantial" or otherwise, in a decision

not to rehire, could place an employee

in a better position as a result of the

exercise of constitutionally protected

conduct than he would have occupied had he

done nothing. The difficulty with the rule

enunciated by the District Court is that

it would require reinstatement in cases

where a dramatic and perhaps abrasive

incident is inevitably on the minds of those

responsible for the decision to rehire, and

does indeed play a part in that decision- -

even if the same decision would have been

reached had the incident not occurred.

(Continued on page 181)

CIT48/2/CM	180	31/5/89
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MR MASON:  And going over the page, about point 6:

In other areas of constitutional law, this Court

has found it necessary to formulate a test of

causation which distinguishes between a result

caused by a constitutional violation and one not

so caused.

And then there is reference in the next paragraph

to some criminal law cases and about half-way down
287:

Initially, in this case, the burden was properly place upon respondent to show that his conduct

was constitutionally protected, and that this

conduct was a "substantial factor" - or, to put

it in other words, that it was a "motivating

factor" in the Board's decision not to rehire him.

Respondent having carried that burden, however,

the District Court should have gone on to determine

whether the Board had shown by a preponderance of

the evidence that it would have reached the same

decision as to respondent's re-employment even

in the absence of the protected conduct.

That, in our submission, is the same as the

SAMREIN approach although the onus is thrust upon the governmental agency to satisfy the Court on the

hypothetical question. Your Honours, the only other

thing we wish to address is the appropriateness of the DEAN MILK test which, at 340 US 354 - I do not

need to take the Court to it - said that a law

would be invalid:

if reasonable nondiscriminatory alternatives,

adequate to conserve legitimate local interests,

are available.

We would disagree with that test and we would

respectfully suggest that the proviso to my learned

friend, Mr Doyle's, 8(d) perhaps has some of the

difficulties which we would see as being associated
with that test.	May I just give four reasons why

we submit the test is inappropriate? The first is
that, on a doctrinal basis, it arises from an

American system where the negative commerce clause

operates as an exclusive grant of power to Congress

and thereby, by implication, withdraws from the

States the power to legislate with respect to certain types of conduct.

By contrast, in Australia, the States have full

power to legislate with respect to interstate trade

and commerce and so there is that distinction.

Secondly, the DEAN test puts the Court in the role of a quasi legislator inquiring about alternative

schemes which were not before Parliament. Thirdly,

what is reasonable leaves a very broad range of

ClT49/l/DR	181	31/5/89
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decision making and the Court may be in the position

of deciding that a particular alternative is the

most reasonable one to the invalid one, where that

particular alternative was politically unacceptable

to the legislators of the particular State. Now,

the answer to that may be, "Well, so be it. If

the CONSTITUTION provides that, so be it." But, in

our submission, it is an undesirable consequence if

there is an alternative effective test. And, fourthly,

the American approach tends to preclude innovation and experimentation because the Court's preferred solution

becomes the national bench-mark.

Experience shows that what may at first sight

seem to be an inappropriate way of addressing a

problem	may, with experience and fine tuning, be
seen to be the best way.	May I just quote two short

passages from the AMERICAN CAN CO. case,

517 P 2d.- The first is a passage

relevant to this innovation point I have just made

and it is at page 700 of the report in the left-hand

column, paragraph 6.

(Continued on page 183)

ClT49/2/DR -	182	31/5/89
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MR MASON·(continuing):

Selection of a reasonable means to accomplish a state purpose is clearly a

legislative, not a judicial, function .....

In particular, the courts -

about point 3, on the left-hand side -

may not invalidate legislation upon the

speculation that machines may be developed

or because additional and complementary

means of accomplishing the same goal may also exist. The legislature may look to

its imagination rather than to traditional

methods such as those which plaintiffs suggest,

to develop suitable means of dealing with

state problems, even though their methods

may be unique. Each state is a laboratory

for innovation and experimentation in a healthy federal system. What fails may

be abandoned and what succeeds may be emulated

by other states. The bottle bill is now

unique; it may later be regarded as seminal.

DEANE J: But, really, do not all these cases talk as if

they are laying down rules but all they are really

doing is arguing about their own facts? I mean,

take this case, you have got a starting point

where when you read Sb, 7 and 9 of the Act together,

what they say - what the Solicitor has said

is that any manufacturer's product will be

disadvantaged unless the manufacturer maintains

a local depot. Why should not you say, "Well,

now, if you've got an Act that says that, you're

in an area where some sort of justification for

saying that somebody will be disadvantaged if

he doesn't maintain a local collection depot

for his product."? And all these rules, really,

tend to be beside the point. I see the force

of your focusing in on characterization but beyond

that, must you not just look at the facts and

see whether it can be characterized as a law

of the forbidden type?

MR MASON:  The problem is that if one gets into too close

an exercise of fine tuning, what the Court is

being invited to do is to consider whether a
better solution which is less destructive of

the rights of the interstate trader can be devised

and, in my submission, whilst that may ultimately

be what the CONSTITUTION requires, there is the

danger that the Court, in so doing, may by an

instant of time in resolving a particular

constitutional case create a benchmark which

ought to be one in which there is a level of
trial and error of legislative judgment which

~s greater than such a benchmark would allow.

ClTS0/1/ND	183	31/5/89
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DEANE J:	But we will end up going down the track again
of rules and by-rules and everything else until
in 50 years time nobody will understand where
it has all got to again.

MR MASON:  My submission is that the test suggested by

the plaintiff is not terribly helpful, namely
that you just weigh the two effects, one against
the other. We are dealing with the situation

where the actual section that Your Honour has
put to me, let it be assumed, has a good and

a bad purpose and it is how one resolves the

question of validity of that section in that

situation that I am suggesting should be a rule.

DEANE J: All I was raising with you was that there is

a danger in this area of seeing logical arguments

in terms of principles of law. I mean, what

is wrong in this case of saying, "Well, you start
with a law that says the manufacturer's products

will be disadvantaged unless the manufacturer

maintains a local collection depot."? That will

need a lot of justification so far as the

interstate trader in section 92 is concerned

but then if it is aimed at preventing or
encouraging the use of reusable containers you

can see it is probably the only way of doing

it. You then go on and look at the differential.

I mean, it is not rules of law if it is - - -

MR MASON:  In a sense it is partly due to the judicial

method of this Court. This Court approaches

problems.via principle and enunciates principle

as it resolves problems.

DEANE J:	But the principle is: is the law a protectionist law?
MR MASON:	Yes, I accept that and I do accept that there

comes a time when it is just an application of

that to the facts without subrules, if that is

the thrust of what Your Honour is putting to

me.

DEANE J: What I am suggesting is if we get ,invo,lved in- these

subrules and lay them all down we are going to

wake up one morning and find that we have just

erected another forest.

MR MASON:  I accept that. Your Honours, the only other

point in the AMERICAN CAN case is to refer to

a passage and· I will not read it but it is at

pages 697 and 698 where the point is made that

the PIKE V BRUCE CHURCH rule may be appropriate for ,

balancing can-parables such as a 60 and an 80 foot long truck
where it is agreed that there is no safety differential but
gives you no assistance when you are balancing incanparables

~uch as an environmental impact against a cost to a trader.

C1T50/2/ND	184	31/5/89
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MR MASON (continuing):  Not even in the American law, as this

passage makes plain, does the PIKE case provide the

assistance which the plaintiff would seek to have

in a case such as we have here today, if the Court

pleases.

MASON CJ: Yes, thank you, Mr Solicitor. Yes, Mr Jackson.

MR JACKSON:  Your Honours, may I first mention just one matter

and that is that we are in agreement with our learned

friends about providing the information that was sought

by the C.Ourt and we will endeavour to do so in an agreed fonn as

soon as possible. The second matter I wanted to mention

is this, Your Honours, that some of the argument of our

learned friends, some of the questions from Your Honours

really worked on the assumption that it might be the

consumer who normally or most often perhaps was the

person who was returning bottles to whatever return

place it might be. Of course, there are people who,

themselves, do that to obtain the money and that

fact is recognized at page 180 in the second reading

speech in 1985 and Your Honours will see a reference

there to the fact that there are scavengers who engage·

in this. I do not mean scavengers in any derogatory

sense but there are persons who do so and it is not

unknown, Your Honours, for small children to do it too.

Your Honours, could I turn then to another matter

and that concerns the fact that there is no refund

amount in respect of wine bottles and a lot, it was

said, of course, go outside South Australia.

Your Honours, all that is required by the Act,of

course,is that the bottles have a sticker of some

approved kind, of course, on them under section 6(1)

and that is all that has to happen to them and there

is nothing really why a sticker could not say, "If

they are returned to a dealer in South Ausralia, you

will get 6 cents deposit" or whatever else the amount

may be.

Your Honour, the third matter I wanted to deal

with was this: much emphasis was placa:iby our learned
friends on what had happened in 1975 and the events

leading to the enactment of the first version of the

legislation. What the Court is concerned with, of

course, is what happened in 1986 when there was a

rapid and, in our submission, excessive reaction to

an issue which was a marketing issue. As to the

amount of the deposit and its comparison with what

went on before, the refund amount - the one cent

refund amount which had gone up to four cents, of

course, was an amount which was not provided for by

a statute; it was a voluntary amount and, of course,

on the material, the figure of six cents is enough

to achieve any litter aim.

ClT51/l/SH _	185	31/5/89
Cascle:.:.aine(2)

The validity of comparisons of that nature

is a matter of some doubt in our submission, in any

event, because beer, as appears from the material in

the special case,is something which is price-sensitive

and it is really a question of relativity, one would

think, not of the sums to each other but, perhaps, to

the price and maybe to other factors. Could I refer

Your Honours to paragraphs 22 and 28.

Your Honours, in relation to the notice under

section 5b(2) - it is at the last page of the volume

of material - the point which we make about the notice

is not its specificity but, rather, that it encompassed

all substantial participants in the market other than

ourselves and that it was part of the system, in our

submission, which came into force at that time.

If I could go, then, to another matter that was

raised and that concerns section lO(la). Your Honours,

the fact that section lO(la) provides, at page 20 of

the volume of statutes that:

This section does not apply to containers to

which section 7 applies -

means merely that section 10(1) and section 10(2),

of course, do not apply to containers to which section 7

applies. That does not mean that section 9 and
section 11 and section 12 cannot operate or do not

have an operation in relation to containers to which

section 7 applies.

An observation which was made by Your Honour

Justice Dawson was that the effect of the legislation

and the delegated legislation was to prevent the Bond

Group and is effective because they used non-refillable

bottles.

(Continued on page 187)

ClTSl/2/SH	186	31/5/89
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MR JACKSON (continuing):  Your Honours, that is so in a sense,

but it achieves the effect or object of having

the bottles returned by legislating for a refund

amount and which imposes a refund amount sufficient

not merely to get bottles returned and to achieve

that aim, but also to keep out the intruder from

interstate.

Your Honours, one other matter that I wanted

to mention concerns the approach to amendments.

Our learned friend's submissions say in effect

that the law derives it character from the

original form of its enactment. Your Honours,

as a broad proposition that may be true in

some cases, but the character of the law

at any time must change in accordance with its

amended form. Your Honours, if one were to

look, for example, at a provision of,say, the

INCOME TAX ASSESSMENT ACT, which gave a deduction

for money invested in Australian films, or mining

ventures, or anything of that kind and provided,

for example, that the income from those investment~

woiild be exempt income, then the INCOME TAX

ASSESSMENT ACT might be said to have amongst

its manifold characters the character of

encouraging investment in those activities. But

if those provisions were repealed then, Your Honours,

the character of the enactment,and its objects,

perhaps, would seem to have changed and it would

not be right to describe it as something which had the same character or object as it originally had.

Your Honours, may I add one matter in relation

to the argument concerning resources and the

effusion of carbon dioxide into the atmosphere?

The weight which was given to that at the time
appears from another reference to the parliamentary

material. That was the speech of the Attorney-General

on the motion for disallowance of the regulation

which was to amend the refund amount to six cents.

It appears at page 236. Your Honour, I really

do not wish to discuss everything on page 236.

MASON CJ: No, I would not have thought so. We are familiar

with it in any event.

MR JACKSON:  Your Honour, I. did have that impression.

MASON CJ:	The only interesting material in the whole case
was - - -
MR JACKSON:	I had the impression the Court might have observed it actually. May I refer particularly
to the third last paragraph on page 236 where what is said by the Attorney-General in the
second sentence is:

CIT52/l/JM	187	31/5/89
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In so far as the use of resource and pollution is

concerned, the available evidence is subject to dispute. On the one hand, it is argued

that the use of refillable bottles may save

some raw material and energy. On the other hand, because refillable bottles have to be washed, the use of refillable bottles may use

more water and water pollution than

non-refillable bottles. The resources involved

are not in short supply and the pollution

would not appear to be significant.	The problem
the effective commercial prohibition of	is whether this reason could reasonably justify
non-refillable bottles.
Your Honours, may I move on from that to the

arguments advanced by our - Your Honours, I should

also say carbon dioxide does not figure in that.

Your Honours, could I move on to the arguments

advanced by our learned friends on more substantive

points? One of the themes which underlies the

argument for South Australia is that the essence

of protectionism is the improving of the competitive

position of local traders as against interstate

competitors because they are local traders. In

consequence,that protectionism is more than a
question of effect with the consequence which is

stated in paragraph 3 of the outline of submissions

on behalf of South Australia, and that is that a

non-protectionist law may have the same effect

on interstate trade as a protectionist law and

the protectionism is mre_ than a question of effect.

Your Honours, we would seek to say two things

about that proposition. One is that if some

element more than a protectionist effect is

required, what is the additionall. element which is

required and that does not appear to be ever

very clearly made out. Secondly, the proposition

that sanething uore than a protectionist effect is required

sits, in our submission, uncomfortably with the

observations of the Court in ·coLE V WHITFIELD,

to which I referred first yesterday and those

are the observations, Your Honours, at page 317

in the bottom left column, in the last paragraph
in the left column and also the paragraph commencing

in the right column, ''In the case of a State law'.'.

(Continued on page 189)

CIT52/2/JM	188	31/5/89
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MR JACKSON (continuing):  Your Honours, the second feature

decisions which deal with problems which are

is that that proposition seems to derive no

support from the United States' decisions.

similar and provide solutions which seem rational

enough to issues which are similar to those which

arise in cases under section 92 in the light of

COLE V WHITFIELD.

Your Honours, if I might indicate,very briefly,

the places that provide some indications that a test

of that nature is one that is not - has been

discovered, as it were, in the United States.	May I
give Your Honours references too; CITY OF

PHILADELPHIA V NEW JERSEY 437 US 617 at pages 623
and 625, DEAN MILK COMPANY V MADISON, 340 US 349

at 353 and 354 and HUGHES V OKLOHAMA, 441 US 322 at 336.

Your Honours, the terms in which the

observations of the court are there made make it

clear that the question is one of effect and they

look at effect with a view to determining whether

the provisions are protectionist in effect.

Your Honours, the next matter with which I wish

to deal is this: the proposition is advanced by our

learned friends that section 92 is not concerned with

individuals, or what is described as an "individual
right to trade". Assuming that means an individual's

right to trade, stated in that way the proposition

perhaps leaves little room for disagreement, but,

what must be remembered, of course, is that section 92
does not allow individual traders, that is the persons
who carry on in interstate trade, to be discriminated

against to the advantage of those traders who operate

from within the State with a view to - in ·

circumstances where that amounts to protectionism.

And the cases relied upon by South Australia

show clearly enough that, even if the interstate

traders in question do not constitute the whole of

the interstate trade, there may still be a

discrimination in which it would contravene section 92.

Your Honours, in that regard, could I give Your Honours

the references to EXXON (X)RPQRATION V MARYIAND, (197_8) 437 US 117

at 126, and at 126, note 16 - I read out to -

Your Honours yesterday a part of note 16, we would invite Your Honours to read the whole of it, where it

deals with some particular effects. The second place

where that appears in the cases relied upon by

South Australia is in MINNESOTA V CLOVER LEAF CREAMERY

(1981) 449 US 456, at pages 471 and 472.

Your Honours, in relation to the question which

is also raised by paragraph 4 of South Australia's

outline of submissiol:13, the question of cost is a

matter of relevance. It may be seen discussed in a

ClT53/l/FK -	189	31/5/89
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number of United States cases, and what is referred

to, on occasions, is the cost to the individual.

The cost to the individual having to repack apples,

or having to establish a shed so he can pack his

cantaloupes in one State before moving them to

another, and things of that kind. And, no doubt, that
is not a matter which is decisive, but it is a matter
to which some weight should be given, and the weight

to be given to it will vary from case to case, and

it may be that the particular amount, no matter how

often multiplied, is one which should not be given

great significance compared with some other more

public interest.

But, it would seem absurd if one were not able

to say, for example, that the sudden increase in a
fee from $100 to $1 million was not a matter to which

regard might be had in determining the nature of a

law.

(Continued on page 191)

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MR JACKSON· (continuing): Your Honours, an attempt was made

by our learned friends to say that the protectionist

objects, to use that word, of a law may appear

from the direct effects of the law and of course,

Your Honours, the use of the expression ~direct

effects' suggest that there are other, namely

indirect, effects which are to be disregarded.

Your Honours, one might have thought that

notions of that kind had been decently interred

in COLE V WHITFIELD, and I would refer Your Honours

to page 314 in the right column, in consequence

of the demise of the criterion

of operation doctrine. It appears to have arisen

again to a degree, anyway.

Your Honours, to place reliance upon any such notion of directness of operation is, in

our submission, a complication and there is,

we would submit, no rational reason why it should

be brought into being as an artificial discrimin.

Indeed, Your Honours, we would submit, why adopt

one which has already been treated as discredited.

Could I move then, Your Honours, to another

matter and that is that reliance is also placed

on a "reasonably capable" test or "could clearly

be achieved". I am referring to the words used

in paragraph 8 of the State's outline of submissions

modified, I am conscious, a little by what was

said in answer to Your Honour Justice Deane.

Your Honours, to adopt some such test of

that nature does in a sense have a superficial

attraction but, in our submission, the attraction

is superficial and it is one the temptation to

adopt which should be resisted. Your Honours,

may I say a number of things about it. One is

that it has a superficial attraction because

it enables a court to say that as between itself

and a State legislature the court is, in effect,
the judge and the legislature is the jury.	By

that I mean not in any exact analogy but I mean
by this that the courts or a court's function

would be to determine whether, on the material

before the c0urt, the measure was capable of

being- regarded by the legislature as adapted

to , to use one expression, achieving a particular

non-protectionist object. If the court held that the legislature might have adopted that

view then the legislature was entitled to do so and the

legislation is valid and it would be valid whether

in truth its effect was to prefer the local to

the interstate trader in a protectionist and

discriminatory way.

Your Honours, the notion, again to use the

expression, does not sit well with COLE V WHITFIELD,

at page 317, and may I take Your Honours to that

very briefly.

C1T54/1/SDL	1 9 1	31/5/89
Castlemaine(2)

What Your Honours will see, at page 317, in the

right column, at the end of the paragraph commencing

"In the case of a St.ate law", the paragraph concludes

in this way:

But if a law, which may be otherwise justified by reference to an object which is not

protectionist, discriminates against inter-

State trade or commerce in pursuit of that

object in a way or to an extent which warrants

characterization of the law as protectionist,

a court will be justified in concluding

that it none the less offends s.92.

And, Your Honours, I should also have said,

in the same column, towards the top of the page,

when the Court is discussing the circumstances

in which a Commonwealth law might contravene

section 92, what there appears, Your Honours,

is this - if I could go to the fifth line in

the column:

Whether such a law is discriminatory in

effect and whether the discrimination is

of a protectionist character are questions

raising issues of fact and degree. The

answer to those questions may, in the ultimate,

depend upon judicial impression.

(Continued on page 192)

C1T54/2/SDL	192	31/5/89
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MR JACKSON (continuing): And the paragraph proceeds and

I ask Your Honours to read on a little further.
Your Honours, the submission made on behalf

of South Australia in that regard also seems to be the very thing which was the subject of

adverse criticism by Your Honour the Chief Justice

in the NORTH EASTERN DAIRY COMPANY case, 134 CLR

at page 608, and Your Honours will see the

paragraph commencing about half-way down the page,

in the third sentence, these words:

The defendant's case was that it was for the

legislature to choose the method of

regulation which it thought necessary or

desirable. This is to disregard the

constitutional injunction as it has been

interpreted by the Court. It is for the

defendant to show that the regulation is
permissible and, to do so, it must satisfy

the Court as a matter of fact

and so on. Your Honours, the notion that such a

doctrine should be adopted derives of course no

support from the American cases to which we have

referred. Your Honours, the reason why, in our

submission, it derives no support is really that,

as the Court said in COLE V WHITFIELD at pages 317

and 318, the means by which _ domestic industry

or trade can be advantaged are legion, and

Your Honours, the Court then went on to say, at the

top of page 318:

The consequence is that there will always be

scope for difficult questions of fact -

not to determine whether particular measures are
capable of constituting discriminatory interference

but, to adopt the Courts words:

whether particular legislative or executive

difficult questions of fact in determining

measures constitute discriminatory

interference with interstate trade.

Your Honours, it is interesting to note, also, that, just returning to the United States for a

moment, where there have been numerous cases giving

rise to challenges under the commerce clause, the

notion has been solidly rejected that the

legislative will is dominant. And Your Honours,

the reason why it cannot be treated as dominant

under section 92 is that of course the States

have their powers and their responsibilities to

enact for their people and their powers are

CIT55/l/CM	193	31/5/89
Castlemaine(2)

preserved under section 107, but section 107,

of course, requires that the powers of the States

be treated as subject to the fact that some of

those powers have been withdrawn, as it were,

from the Parliament of the State, and one of

the provisions which has an effect in that

regard is section 92.

Your Honours, the States are subject to

section 92, so to,as section 5 of the

CONSTITUTION ACT emphasises, are the people and

courts of the nation, notwithstanding anything

in the law of the State. Now,Your Honours,I

do not want to go into that in detail, but if it

is right to say that there is by virtue of

section 92 a free market throughout Australia,

then that is a matter which the States have to

take into account when legislating.

And Your Honours, whilst it may be desirable,

and I do not doubt it for a moment, for States to

seek to develop distinctive policies, they cannot

do so and contravene section 92.

Your Honours, may I deal with a number of

other matters briefly. One is in relation to

a matter that was raised by Your Honour

Justice Brennan yesterday, and that concerned

paragraph ·69 of the special case stating the

object and effect of the Act. Could I ref er

Your Honour also to paragraph368 to 78.

(Continued on page 195)

-

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MR JACKSON: 

Your Honours, one matter that I wish to mention

concerns the submissions made by my learned friend
concerning the approach taken in COLE V WHITFIELD

in relation to the facts in that case. Could I take Your Honours for just one moment back to

that case at page 318. Your Honours will see in the

left column, about two-thirds the way down the page

beside letter E, the Court says:

In that respect no discriminatory protectionist

purpose appears on the face of the law.

And then the Court goes on to discuss, as a

matter of fact, the effect of the law. The way in

which the Court approached the matter there was a

way which indicated the Court coming to its own

view on the agreed facts and the legislation in the

light of the agreed facts. Your Honours, in

relation to the United States cases and the summary

of them given by our learned friends, may I just

say two things: one is that when one comes to

paragraph 10 of it there is a reference to the

per se invalidity test used. That seems to be a

test used principally when there is discrimination

on the face of the legislation. The second thing,

Your Honours, is that if one goes to the American

cases in courts other than the supreme court, and

in particular the cases referred to in paragraphs 14 and.

one must have some doubts, with respect, whether the

courts in those cases were giving sufficient weight

to the approach taken by the supreme court in the

cases to which we have referred and were perhaps giving

rather. too much weight to the legislative will

rather than to the views adopted by the supreme court. Your Honours will have seen, in some of the cases to which we have referred, that, hardly

surprisingly, views different from those taken

in courts below have been taken on facts of particular

cases in the supreme court.

Would Your Honours excuse me just for a moment? Your Honours those are our submissions.

MASON CJ:	Yes, thank you, Mr Jackson. The Court will consider
its decision in this case.-

AT 3.30 PM THE MATTER WAS ADJOURNED SINE DIE

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