Clyne v Director of Public Prosecutions

[1984] HCA 56

HIGH COURT OF AUSTRALIA

Gibbs C.J., Mason, Brennan, Deane and Dawson JJ.

PETER CLYNE v. THE DIRECTOR OF PUBLIC PROSECUTIONS FOR THE COMMONWEALTH OF AUSTRALIA AND THE ATTORNEY-GENERAL FOR THE COMMONWEALTH OF AUSTRALIA

(1984) 154 CLR 640

3 September 1984

Criminal Law

Criminal Law—Statutory offence—Mode of trial—Power to make regulations prescribing penalties for offences against regulations—Regulation prescribing penalties varying according to whether summary trial or trial on indictment—Validity—Whether regulation prescribes mode of trial—Whether confers discretion as to mode of prosecution—Banking (Foreign Exchange) Regulations—Banking Act 1959 (Cth), ss. 39(2), 70—Acts Interpretation Act 1901 (Cth),ss. 42, 43.

Decisions

GIBBS C.J. Before the Court is a demurrer to the statement of claim filed by the plaintiff in an action commenced in the original jurisdiction of this Court. The statement of claim alleges that the plaintiff has been charged with a breach of reg.40 of the Banking (Foreign Exchange) Regulations ("the Regulations") made in intended exercise of the powers conferred by the Banking Act 1959 (Cth), as amended ("the Act") and has been committed for trial before the District Court of New South Wales. The first defendant, the Director of Public Prosecutions for the Commonwealth, has taken over the prosecution and has informed the plaintiff that a bill of indictment is to be presented. The plaintiff claims that reg.42 of the Regulations is ultra vires and null and void and that therefore a breach of reg.40 would not expose him to any penalty or punishment. He claims a declaration that regs.40 and 42 are void and an injunction restraining the first defendant from proceeding with the trial.

2. This Court has in a number of cases said that it is wrong that the ordinary course of proceedings in the criminal courts should be interrupted by applications for declarations as to questions that will or may arise in the criminal proceedings: see Crouch v. The Commonwealth (1948) 77 CLR 339, at p 348 and Sankey v. Whitlam (1978) 142 CLR 1, at p 26; cf. Reg. v. Iorlano (1983) 58 ALJR 22; 50 ALR 291. In the present case it would have been open to the defendants to apply to stay the proceedings as vexatious or as an abuse of the process of the court. However no such application was made, and the defendants chose to demur. Now that the demurrer has been set down for hearing before us it is convenient to determine it.

3. Regulation 40 of the Regulations provides as follows:

"A person shall not make -

(b) to any Commonwealth officer;

(c) to any officer of the Bank or of an agent of the Bank; or

(d) to any person to whom application is made for the issue of a money order payable outside Australia,

any statement, whether oral or in writing, relating to any act, transaction, matter or thing to which any provision of these Regulations applies, which he knows to be untrue, or which is misleading, in any particular, or which is made by him without his having first made proper inquiries to ascertain the truth thereof."

4. Like a number of other regulations in Part V of the Regulations, reg.40 does not itself provide any penalty for its contravention. However, reg.42(1) of the Regulations provides as follows:

"A person shall not contravene or attempt to contravene, or fail to comply with, any of the
provisions of these Regulations.

Penalty -

(a) if the offence is prosecuted summarily - a fine not exceeding One thousand dollars or imprisonment for a term not exceeding six months; or

(b) if the offence is prosecuted upon indictment - a fine not exceeding One hundred thousand dollars or imprisonment for a period not exceeding five years."

5. A power to make regulations for various purposes related to, inter alia, foreign exchange and the protection of the currency is conferred on the Governor-General by s.39(1) of the Act. By s.39(2), it is provided, inter alia, as follows:

"The regulations authorized to be made by this

section are regulations (being regulations with respect to matters with respect to which the Parliament has power to make laws) making provision for or in relation to -

...

(q) prescribing penalties not exceeding a fine of $100,000, or imprisonment for a period not exceeding 5 years, for offences against the regulations made under this section".

The only other provision of the Act to which it seems necessary to refer is s.70(2), which provides as follows:

"An offence arising -

(a) under regulations made under section 39; or

(b) under Part IV,

may be prosecuted summarily with the consent in writing of a person authorized in writing by the Treasurer to consent to the summary prosecution of offences under those regulations or that Part."

6. The argument presented on behalf of the plaintiff, that reg.42 is not a valid exercise of the power conferred by s.39(2)(q) of the Act, is in substance that the power given by that provision to make regulations prescribing penalties for offences does not enable the Governor-General to prescribe penalties the upper limit of which is different depending on whether the offence is prosecuted summarily or upon indictment. In other words it is submitted that the provision empowers the Governor-General to do no more than prescribe one maximum penalty for each offence, however it is tried. Support for this argument is sought to be found in the provisions of ss.42 and 43 of the Acts Interpretation Act 1901 (Cth), as amended, and s.21 of the Crimes Act 1914 (Cth), as amended.

7. The crux of the argument submitted for the plaintiff is that reg.42 does not prescribe a penalty for an offence against the regulations; at best it prescribes alternative penalties and at worst it delegates to the prosecution the power to determine the maximum penalty. Alternatively, the regulation goes beyond prescribing a penalty, and prescribes alternative modes of trial.

8. I cannot accept that reg.42 prescribes the mode of trial of offences against the Regulations. What the regulation does is to leave it to the prosecutor to select one of the two modes of trial available under the general law and to provide for different penalties according to whether the offence is prosecuted summarily or on indictment. It is an "old principle that where an Act of Parliament creates an offence and prescribes no remedy for it, the offence is indictable at common law" (Reg. v. Hall (1891) 1 QB 747, at p 767) unless of course the statute reveals an intention to exclude procedure by way of indictment (Rathbone v. Bundock (1962) 2 QB 260, at p 277). For the purposes of the application of this principle, the regulation must be treated as a provision of the Act under which it was made (see Rathbone v. Bundock, at p 274, and cases there cited). Section 70(2) of the Act, by providing that an offence may be prosecuted summarily if the requisite consent is given, impliedly recognizes that where the consent is not given or the discretion to proceed summarily is not exercised, the offence may be prosecuted on indictment. Regulation 42 proceeds upon the assumption which is, in my opinion, correct, that an offence against the Regulations may be prosecuted either summarily or upon indictment. It then provides a maximum penalty in each case.

9. The real question is whether s.39(2)(q) empowers the Governor-General to make regulations which prescribe penalties which vary according to the mode of trial. The words which introduce s.39(2) are wide and general, and authorize the making of regulations which make provision not only "for" but also "in relation to" the matters specified in the following paragraphs. The words of par.(q) do not in terms provide that the regulations may prescribe only one penalty, or one maximum penalty, for an offence. It is by no means uncommon in legislation in Australia to find that the penalties that may be imposed for an offence are different depending on whether the offence is prosecuted summarily or on indictment. The words of s.39(2)(q) are wide enough to enable the regulations made under it to prescribe penalties which vary according to whether there was a summary trial or a trial on indictment. There seems no reason to read into those words a restriction which is not expressed, and which would prevent the Governor-General from following what is a usual and convenient course.

10. In my opinion, ss.42 and 43 of the Acts Interpretation Act and s.21 of the Crimes Act do not assist the argument of the plaintiff. Sections 42 and 43 of the Acts Interpretation Act provide as follows:

"42. Offences against any Act which are punishable by imprisonment for a period exceeding 6 months shall, unless the contrary intention appears, be indictable offences.

43. Offences against any Act which -

(a) are punishable by imprisonment, but not for a period exceeding 6 months; or

(b) not being punishable by imprisonment, are not declared to be indictable offences,

shall, unless the contrary intention appears, be punishable on summary conviction."

Those sections directly apply only to Acts, but they are indirectly applied to regulations by s.46 of the Acts Interpretation Act. However they do not apply, according to their own terms, either to the Act or to the Regulations now under consideration. The combined effect of ss.42, 43 and 46 is that if an Act (or a regulation) provides that an offence is punishable by imprisonment for a period exceeding six months, then, unless the contrary intention appears, the offence will be indictable, whereas if, inter alia, an Act (or regulation) makes an offence punishable by imprisonment for a lesser period, the offence will, unless the contrary intention appears, be punishable on summary conviction. There is no provision of the Act to which ss.42 and 43 could sensibly be applied, because the Act itself does not provide whether offences under it are to be punishable by imprisonment for a term exceeding six months or for a lesser period. By s.39(2)(q), the prescription of penalties is left to the Regulations. However, the manner in which reg.42 is drafted leaves no room for the application to that regulation of ss.42 and 43 of the Acts Interpretation Act, as rendered applicable to regulations by s.46. Regulation 42 does not distinguish between offences that are punishable by imprisonment for more than six months and those that are punishable by imprisonment for less than that period. It approaches the matter from a different standpoint, and indicates the respective maximum penalties that may be imposed if the offence is tried summarily and if it is tried on indictment. Sections 42 and 43 are inapplicable to a provision in that form.

11. The argument for the plaintiff necessarily involves the proposition that ss.42 and 43 in some way operate as a restraint on regulation-making power. In my opinion it is impossible to consider them as having that effect. They are intended to aid in the interpretation of particular statutory provisions, by indicating what mode of trial must, in the absence of a contrary intention, be used if a particular punishment is provided. They do not in my opinion affect the width of the power conferred by s.39(2)(q) or invalidate the provisions of reg.42.

12. The argument based on s.21 of the Crimes Act is that reg.42 in effect overrides the provisions of that section and that it could not have been intended by the Parliament to give the Governor-General power to make a regulation having that effect. Section 21 provides for the times within which prosecutions may be commenced for offences against laws of the Commonwealth. In my opinion reg.42 has no affect whatever on the operation of s.21 of the Crimes Act. If, as the judgment of Rich and McTiernan JJ. in In re Burley (1932) 47 CLR 53, at p 57, suggests, s.21 does not contemplate provisions which make the amount of the penalty depend upon the mode of trial or prosecution, and so is inapplicable to a statutory provision such as reg.42, that shows that the provisions of s.21 remain unaffected by reg.42. If, on the other hand, s.21 does on its proper construction apply to reg.42, then that of course disposes of this argument.

13. What appears to be suggested is that s.21 of the Crimes Act, and ss.42 and 43 of the Acts Interpretation Act as well, must have been regarded by the Parliament as inviolable provisions from which no detraction was intended to be allowed by regulations made under a general power. There is in my opinion simply no reason for reading down the power given by s.39(2)(q) in a way that would require it to be exercised only by making regulations that would necessarily attract the operation of s.21 of the Crimes Act and ss.42 and 43 of the Acts Interpretation Act.

14. It follows from what I have said that even if reg.42 were invalid that would not mean that an offender against reg.40 could not be tried on indictment for a breach of that section.

15. In my opinion reg.40 and reg.42 are both valid. I would allow the demurrer.

MASON and BRENNAN JJ. Sections 42 and 43 of the Acts Interpretation Act 1901 (Cth) prescribe rules for determining whether an offence created by a Commonwealth Act is indictable or is punishable on summary conviction. We need not repeat their provisions. Sections 42 and 43 take the severity of the prescribed penalty as the criterion for determining whether an offence is to be prosecuted on indictment or is to be prosecuted summarily. The severity of a maximum penalty is oftentimes a fair indication of the seriousness of the offence, and ss.42 and 43 are enacted on that assumption. But the assumption is not valid in all cases. Sometimes an offence is created in terms which comprehend very serious cases and cases of quite minor significance. It would be undesirable if the prescription of a single maximum penalty required even cases of minor significance to be prosecuted on indictment. To avoid that result, it has been found convenient to prescribe some penalties in terms which preclude the application of ss.42 and 43. A higher penalty is prescribed for conviction on indictment than for summary conviction, the assumption being that the more serious cases will be prosecuted on indictment, the less serious summarily.

2. When penalties are prescribed by reference to the mode of prosecution and ss.42 and 43 do not apply, provision has to be made for determining what the mode of prosecution is to be. Usually a discretion is conferred expressly on the prosecutor. A prosecutor, armed with such a discretion, has a power that is capable of working oppression. The prosecutor may, by prosecuting summarily, deny the accused the protection of trial by jury given him by s.80 of the Constitution; or the prosecutor may, by prosecuting on indictment, place a heavier burden on the accused than the seriousness of the case warrants. Nevertheless, the legislative practice of conferring such a discretion is longstanding. Perhaps the most notable example was s.10 of the National Security Act 1939 (Cth).

3. Sections 42 and 43 cannot and do not purport to restrict the Parliament's liberty to prescribe penalties in any manner that it chooses. It is submitted, however, that where a power is conferred upon the Governor-General to make regulations prescribing penalties for offences created by the same regulations that power must be exercised so as to permit the operation of ss.42 and 43. Section 46(a) of the Acts Interpretation Act applies the provisions of that Act to regulations as if the regulations were an Act.

4. This submission is the foundation of an attack upon the validity of the Banking (Foreign Exchange) Regulations which create offences and prescribe penalties for those offences in terms to which ss.42 and 43 of the Acts Interpretation Act cannot apply. Regulation 42(1) provides:

" A person shall not contravene or attempt to contravene, or fail to comply with, any of the provisions of these Regulations.

Penalty -

(a) if the offence is prosecuted summarily - a fine not exceeding One thousand dollars or imprisonment for a term not exceeding six months; or

(b) if the offence is prosecuted upon indictment - a fine not exceeding One hundred thousand dollars or imprisonment for a period not exceeding five years."

5. The plaintiff, who has been charged with an offence arising under the Regulations and is awaiting trial on that charge, contends that the Governor-General did not validly exercise the power to prescribe penalties conferred upon him by s.39(2)(q) of the Banking Act 1959 (Cth). The ground assigned for the attack is the disconformity which exists between the manner of prescribing penalties envisaged by ss.42 and 43 of the Acts Interpretation Act and the terms of reg.42(1). But ss.42 and 43 of the Acts Interpretation Act do not purport to limit, or to govern the exercise of, the subordinate legislative power conferred by s.39(2) of the Banking Act. On their face, ss.42 and 43 apply to those provisions in regulations which attract their operation, but they do not compel the making of regulations that permit their operation or prohibit the making of regulations that do not. It was not argued that the power to prescribe penalties granted in the general terms of s.39(2)(q) was to be read down to exclude a power to prescribe higher penalties for conviction on indictment than for summary conviction. The only tenable foundation for such an argument would require s.39(2)(q) to be read together with ss.42 and 43 of the Acts Interpretation Act and to attribute to ss.42 and 43 a restrictive operation upon the grant of power which those sections do not have. The primary ground of attack fails.

6. However, the challenge brings to light another ground of attack. Regulation 42(1) envisages a discretion as to the mode of prosecution, and it is argued that reg.42(1) itself impliedly, though not expressly, confers such a discretion. If that step in the argument be right, the next step is that s.39(2) of the Banking Act does not include the conferring of such a discretion among the subjects with respect to which the Governor-General is authorized to make regulations. The conclusion of the argument is that, as a discretion as to the mode of prosecution cannot be conferred by regulation, reg.42(1) must be invalid. An answer to this argument lies in s.70 of the Banking Act. The relevant provisions of that section are:

" (1) Subject to the next succeeding sub-section, proceedings for an offence against this Act or the regulations shall not be instituted without the consent in writing of the Treasurer.

(2) An offence arising -

(a) under regulations made under section 39; or

(b) under Part IV,

may be prosecuted summarily with the consent in writing of a person authorized in writing by the Treasurer to consent to the summary prosecution of offences under those regulations or that Part."

7. It may be said, and said truly, that s.70(2) is an exception to the general restriction on prosecution imposed by s.70(1). But s.70(2) also confers a power to prosecute an offence summarily when consent is given in writing by an authorized person. No doubt an offence arising under Part IV of the Act (when that Part was in operation) could have been prosecuted summarily only if the prosecutor decided so to do in exercise of the discretion conferred by s.49(2) (which applied to Part IV offences) and consent was given under s.70(2). In cases which arose under Part IV, s.70(2) was not the source of the power to prosecute summarily. However, that subsection is the source of the power to prosecute summarily offences arising under the Regulations. That subsection clearly envisages that some offences arising under the Regulations will be prosecuted summarily and there are no other provisions of the Act which purport to confer the requisite power. Without such a power, breaches of the regulations would have to be prosecuted on indictment as common law misdemeanours: see Ex parte Nomarhas; Re Comans (1944) 44 SR(NSW) 187, at pp 190-191; Ex parte Gerard &Co.Pty Ltd.; re Craig (1944) 44 SR(NSW) 370, at p 375. The power to prosecute summarily offences arising under the Regulations is conferred by the Act itself. It is not necessary to imply that power from the terms of reg.42(1). Accordingly, reg.42(1) is not to be construed as purporting to confer that power. The argument fails at the first step. The penalties prescribed by reg.42 are ascertained in each case according to the mode of prosecution adopted, and the mode of prosecution which may lawfully be adopted depends on the consent given under s.70.

8. It follows that the plaintiff's action for a declaration of invalidity of the regulations under which he is charged fails and the defendants' demurrer to his statement of claim must be allowed.

DEANE J. I agree with the judgment of Dawson J. I add some comments of my own.

2. The ordinary common law procedure for bringing offenders to justice on criminal charges is by indictment before a jury (Chitty's Criminal Law, 2nd ed. (1826), vol.1, p.162). In England, "the most usual and constitutional course" was for the indictment itself to be presented by a grand jury (see Broom, The Common Law, 6th ed. (1880), p.961 and Reg. v. Slator (1881) 8 QBD 267). While the grand jury system of indictment was introduced in some of the Australian Colonies and remains available in Victoria as a "special procedure" (see Rex v. McInnes, Erskine and Calwell (1940) VLR 416, at p 420; Crimes Act 1958 (Vict.), s.354, as amended) it did not obtain general acceptance in this country where "indictment", "information" or "presentment" by the Attorney-General or other law officer either after committal or ex officio became established as the ordinary method of prosecuting serious offences before a jury. Notwithstanding differences in methods of "indictment" however, the jury system itself came to be universally accepted here, as in England, as the established and ordinary method of trial for serious offences. At Federation, "the laws of all the States provided for the trial by jury of persons tried on indictment, and it was thought desirable to lay down the rule that the trial of persons charged with new indictable offences created by the Commonwealth Parliament should be tried in the same way" (per Griffith C.J., Rex v. Bernasconi (1915) 19 CLR 629, at p 635; Constitution, s.80). In this country, as in England, no court, judge or magistrate possesses jurisdiction summarily to try or punish an offence against the law and no prosecutor is empowered to institute summary proceedings against an alleged offender unless there be some identifiable applicable statutory authority for such summary prosecution and trial. This is an inevitable consequence of the fact that all summary jurisdiction in criminal matters "is the creature of statute" (per Blackburn J., White v. Feast (1872) LR 7 QB 353, at p 358) to which "the common law is a stranger ... unless in the case of contempts" (Blackstone's Commentaries on the Laws of England, 15th ed. (1809), vol.4, p.280).

3. Section 43 of the Acts Interpretation Act 1901 (Cth) provides that offences against any Act which are not punishable by imprisonment or are punishable by imprisonment for not more than six months shall, unless the contrary intention appears, be punishable on summary conviction. Plainly, that section does not authorize the bringing of summary proceedings in respect of an alleged offence punishable under the impugned reg.42 of the Banking (Foreign Exchange) Regulations ("the Regulations") since the penalty for such an offence is not known unless and until the question whether the proceedings will be summary or by indictment has been determined. Nor do the provisions of s.70(2) of the Banking Act 1959 (Cth) have the unlikely effect of conferring upon any "person authorized in writing by the Treasurer" a discretion to decide whether the prosecution of a particular offence against the Regulations should or should not be upon indictment before a jury. As Dawson J. points out, that sub-section is properly to be seen as merely relaxing the general requirement, contained in s.70(1), that proceedings for an offence against the Act or the Regulations should not be instituted without the written consent of the Treasurer himself. It is framed on the basis that the question whether proceedings should be prosecuted summarily or upon indictment would already have been determined either by the appropriate law officer where there is a discretion as to the method of prosecution in the particular case (cf. s.49 of the Banking Act) or by the general provisions of the Acts Interpretation Act operating upon "penalties" prescribed by the Regulations. It is not suggested that there is any provision in any other Act of the Parliament which authorizes the Commonwealth to bring summary proceedings in respect of an alleged offence against the Regulations. If such authority exists, it must be because it is impliedly conferred by the provisions of reg.42 itself which is framed on the basis that there exists a discretion in the Executive to proceed either summarily or by indictment in respect of such an offence. It is common ground that reg.42 was made in purported pursuance of the regulation-making power conferred by par.(q) of s.39(2) of the Banking Act. The question arises whether the provisions of that paragraph, which confer upon the Governor-General power to make regulations "making provision for or in relation to - ... prescribing penalties ... for offences against the regulations made under this section", can properly be construed as evincing a legislative intent that the Governor-General (i.e., the Executive) should be empowered to make a regulation having the effect that the procedure which determines the mode of trial and the maximum penalty for such offences should be left to the choice of the Executive itself in the particular case. I agree with Dawson J., for the reasons which he gives, that that question must be answered in the negative and that it follows that reg.42 of the Regulations is void in so far as it purports to impose a penalty for any offence and that the demurrer should be overruled.

4. The guarantee of trial by jury which is contained in s.80 of the Constitution has been drained of most of its strength by the combined effect of legislation of the Parliament and decisions of the Court (see, e.g., Zarb v. Kennedy (1968) 121 CLR 283, at pp 294, 297 and 298-299). It will indeed have been reduced to the status of "a mere procedural provision" (see Spratt v. Hermes (1965) 114 CLR 226, at p 244) if, on a question of statutory construction, it is inadequate to provide strong support for the presumption that the Parliament would not have intended either that a statutory grant of an Executive power to make regulations prescribing penalties should be construed as encompassing a grant of an Executive power to confer upon itself a discretion to choose the manner of trial in any particular case and thereby determine whether the provisions of s.80 are applicable or that, in the context of a statutory provision dealing with the Treasurer's consent to prosecutions under the Banking Act, a provision relaxing the need for the consent of the Treasurer himself should be construed as conferring such a discretion upon any "person authorized by the Treasurer".

DAWSON J. The plaintiff has been charged with a breach of reg. 40 of the Banking (Foreign Exchange) Regulations which is a regulation prohibiting the making of false statements in specified circumstances. The prohibition may be contained in reg. 40, but strictly speaking the offence is created by reg. 42 which, so far as is relevant, provides:

"(1) A person shall not contravene or attempt

to contravene, or fail to comply with, any of the provisions of these Regulations.

Penalty -

(a) if the offence is prosecuted summarily - a fine not exceeding One thousand dollars or imprisonment for a term not exceeding six months; or

(b) if the offence is prosecuted upon indictment - a fine not exceeding One hundred thousand dollars or imprisonment for a period not exceeding five years."

Nothing turns upon whether the relevant offence is created by reg. 40 or reg. 42. It is to the validity of the penalties which reg. 42 prescribes that the plaintiff directs his argument. That regulation purports to have been made pursuant to s. 39(2)(q) of the Banking Act 1959 (Cth), which authorizes the Governor-General to make regulations "making provision for or in relation to -

(q) prescribing penalties not exceeding a fine of $100,000, or imprisonment for a period not exceeding 5 years, for offences against the regulations made under this section;"

The offence with which the plaintiff is charged is, of course, an offence against a regulation made under s. 39.

2. The plaintiff submits that reg. 42(1) is beyond the power conferred upon the Governor-General by s. 39(2)(q) of the Banking Act. At the heart of that submission is the argument that reg. 42(1) does not prescribe a penalty for the offence which it creates or, if it does, it does so only when the choice which the regulation confers is exercised. That choice, it is said, is a choice between two alternative modes of prosecution - summary prosecution or prosecution upon indictment - and its exercise is left (subject to s. 70 of the Banking Act to which I shall refer later) to whoever prosecutes the offence.

3. If reg. 42(1) does not prescribe a penalty at all then the regulation can have no relevant operation for reasons which I shall deal with later and that is an end to the matter; no question of power really arises then because the regulation fails to do what it purports to do.

4. On the other hand, if the regulation does fix penalties but does so only by reference to the mode of prosecution adopted it must, even if only impliedly, confer a power upon the prosecution to choose the mode and this, it is said, goes beyond the power to prescribe penalties which s. 39(2)(q) of the Banking Act confers upon the Governor-General.

5. A sharper focus is given to the plaintiff's argument by reference to ss. 42 and 43 of the Acts Interpretation Act 1901 (Cth), because those sections form part of the statutory context in which the provisions of the Banking Act, and, in particular, s. 39(2)(q) and s. 70(1) and (2), must be construed. Section 42 provides that offences against any Act which are punishable by imprisonment for a period exceeding 6 months shall, unless the contrary intention appears, be indictable offences. Section 43 provides that offences against any Act which are punishable by imprisonment, but not for a period exceeding 6 months or, not being punishable by imprisonment, are not declared to be indictable offences shall, unless the contrary intention appears, be punishable on summary conviction.

6. The Acts Interpretation Act is made applicable to regulations by s. 46(a) of that Act as if each regulation were a section of an Act. But the applicability of the Act is subject to a contrary intention appearing (s. 2) and for that reason it cannot be contended that ss. 42 or 43 of the Act has any operation in relation to reg. 42(1) of the Banking (Foreign Exchange) Regulations. A contrary intention appears because the operation of those sections to determine whether an offence may be prosecuted upon indictment or summarily is made dependent upon the nature and extent of the penalty provided and reg. 42(1) does not provide any penalty until it is first determined whether the prosecution is summary or upon indictment. A determination under reg. 42(1) which led to an offence being prosecuted summarily or upon indictment would, if it were validly made, render unnecessary any recourse to the Acts Interpretation Act. That is to say, any attempt to give s. 42 or s. 43 of the Acts Interpretation Act an operation in relation to reg. 42(1) of the Banking (Foreign Exchange) Regulations must involve the application of a circular mode of reasoning leading to no answer.

7. The problem cannot be overcome by reading reg. 42(1) so as to make the offence which it creates punishable by the highest penalty referred to in the regulation, namely, a fine not exceeding One hundred thousand dollars or imprisonment for a period not exceeding five years. To do so would enable an operation to be given to s. 42 of the Acts Interpretation Act but it would have the effect of making all offences under reg. 42 punishable upon indictment only and that is something which the regulation clearly does not contemplate. Cf. In re Burley (1932) 47 CLR 53. The result is that reg. 42 cannot be read together with ss. 42 and 43 of the Acts Interpretation Act. The regulation exhibits a contrary intention to those sections and so excludes them. Nevertheless, as I have already remarked, that does not mean that the existence of those sections is irrelevant to the proper construction of the relevant sections of the Banking Act.

8. It may be noted in passing that s. 12 of the Crimes Act 1914 (Cth) provides that offences against that Act, other than offences expressed to be indictable offences, shall be punishable either on indictment or on summary conviction. But that section applies only to offences under the Crimes Act, as does s. 12A which provides that any proceeding in respect of an offence against the Act, although declared indictable, may, with the consent of the defendant, be heard and determined by a court of summary jurisdiction. It may also be noted that s. 21 of the Crimes Act which has a wider application in that it applies to any law of the Commonwealth, provides differing time limits for the commencement of the prosecution of offences where the maximum term of imprisonment exceeds six months and where it does not exceed six months or no term of imprisonment is provided. That section purports to apply to reg. 42 of the Banking (Foreign Exchange) Regulations although its actual application would require different time limits to be applied to the commencement of summary prosecutions and prosecutions upon indictment. What is significant, however, is that such an application of s. 21 of the Crimes Act to reg. 42(1) would leave to the prosecutor of an offence under that regulation a choice as to the time limit for the commencement of the prosecution according to whether he prosecuted the offence summarily or upon indictment. Such a choice would not appear to be something which was envisaged by s. 21 and that section is also part of the background against which the relevant sections of the Banking Act must be construed.

9. The inapplicable provisions of the Acts Interpretation Act and of the Crimes Act to which I have referred can have no direct effect upon the proper construction of reg. 42(1). But they do indicate that provision has been made by statute for the classification of offences into those punishable on indictment and those punishable on summary conviction and, in the case of the Acts Interpretation Act, that classifiction is made dependent upon the penalties provided. That does at least suggest caution against construing a power to prescribe penalties by regulation as extending either to the classification of the offences to which the penalties are attached as indictable or summary or (and this is the effect of reg. 42(1)) to the prescription of penalties which are dependent upon the choice of a mode of prosecution, that choice being conferred by the regulation itself. For the reasons which I have already given s. 21 of the Crimes Act would suggest a similar caution.

10. Of course, the position would be quite different if a discretion to prosecute summarily were conferred by statute rather than by regulation and different penalties were imposed according to whether the prosecution was by way of summary proceedings or upon indictment. Then no question of power would be involved. Such was the case in a number of instances given in the course of argument, presumably to indicate a legislative practice. See, for example, s.10 of the National Security Act 1939 (Cth), and Ex parte Nomarhas; Re Comans (1944) 44 SR (NSW) 187, at pp 189-190. As summary offences are entirely the creature of statute (see per Blackburn J., White v. Feast (1872) LR 7 QB 353, at p 358), and there is in this case no applicable, general provision for their creation such as is to be found in the Acts Interpretation Act or the Crimes Act, it must be to reg. 42 that one must look to find, if it is to be found at all, the classification of an offence under that regulation as either summary or indictable. It is not possible to say that reg. 42 merely recognizes a choice which is available generally between summary prosecution and prosecution on indictment.

11. In the end the question is merely one of the construction of s. 39(2)(q) of the Banking Act. There is, in my view, no basis upon which it could be said that a power, given by statute to prescribe by regulation penalties for offences created by regulation, extends to the prescription of the mode of prosecution either directly or by conferring a choice upon the prosecutor. I should have reached that conclusion in any event upon the language of s. 39(2)(q) but I should add that s. 80 of the Constitution, which provides that the trial on indictment of any offence against any law of the Commonwealth shall be by jury, warrants a jealous approach to any suggestion that the procedure which determines the mode of trial may be the subject of a discretion conferred by a mere regulation. Moreover, as Dixon J. observed in Munday v. Gill (1930) 44 CLR 38, at p 86:

"There is ... a great distinction in history,

in substance and in present practice between summary proceedings and trial upon indictment. Proceedings upon indictment, presentment, or ex officio information are pleas of the Crown. A prosecution for an offence punishable summarily is a proceeding between subject and subject. The former are solemnly determined according to a procedure considered appropriate to the highest crimes by which the State may be affected and the gravest liabilities to which a subject may be exposed. The latter are disposed of in a manner adopted by the Legislature as expedient for the efficient enforcement of certain statutory regulations with respect to the maintenance of the quiet and good order of society."

12. Counsel for the defendants submitted that if statutory authority is required for the classification of offences under the Banking (Foreign Exchange) Regulations into offences which may be prosecuted summarily and those which may be prosecuted upon indictment, it is to be found in s. 70(1) and (2) of the Banking Act. Those sub-sections provide:

"(1) Subject to the next succeeding

sub-section, proceedings for an offence against this Act or the regulations shall not be instituted without the consent in writing of the Treasurer.

(2) An offence arising -

(a) under regulations made under section 39; or

(b) under Part IV,

may be prosecuted summarily with the consent in writing of a person authorized in writing by the Treasurer to consent to the summary prosecution of offences under those regulations or that Part."

Clearly s. 70 is intended to do no more than lay down a requirement that prosecutions for the offences to which it refers shall not be instituted without consent. The sole purpose for which sub-s. (2) refers to offences which may be prosecuted summarily is to relax for those offences the requirement that the necessary consent be given by the Treasurer and to allow it to be given by some person authorized by him. Indeed, s. 70 does not suggest that it was contemplated that a distinction might be made between offences which may be prosecuted summarily and those which may not, that distinction being dependent upon the exercise of a choice by the prosecution. If that were so the type of consent required would be dependent upon the exercise of that choice. Rather, s. 70 suggests that, there being no other section dealing with the matter, reliance was placed upon some such provision as is made by s. 42 and s. 43 of the Acts Interpretation Act classifying offences into those which are indictable and those which may be prosecuted summarily. The section certainly does not make such a classification itself or provide a source of power for doing so by regulation.

13. If any further guide to the true purpose of s. 70 is needed, it may be found in s. 49(2) of the Banking Act. That section appears in Part IV of the Act and, although that Part is no longer in operation, it may nevertheless assist in the proper construction of s. 70. Section 49(2) specifically provides that an offence arising under Part IV may be prosecuted either summarily or upon indictment. Such a provision makes it impossible to suggest that, in relation to offences under Part IV, s. 70 is the provision which confers a discretion to prosecute summarily or upon indictment. Since s. 70 applies indifferently to offences under Part IV and offences under the regulations, the conclusion is, in my view, inescapable that s. 70 confers no such discretion at all.

14. Indeed, if by some means the section could be construed so as to confer such a discretion, it would operate in such a curious way as to indicate that the construction must be erroneous. The choice to bring proceedings summarily would be left to some person authorized by the Treasurer to consent to the summary prosecution of offences. The Treasurer himself could not exercise that choice. And the exercise of that choice by the person authorized by the Treasurer would preclude the exercise of any discretion to proceed upon indictment which would otherwise be exercisable by a law officer authorized to make presentment in the name of the Crown. Moreover, if it were only the Treasurer who, under s. 70(1), consented to the institution of proceedings, without authorizing anyone else to consent, there would be no choice of any mode of prosecution. That sub-section provides that the consent in writing of the Treasurer is sufficient for any prosecution, whether summary or upon indictment, without selecting any mode or conferring any discretion.

15. Whilst only limited assistance is to be gained from a comparison of other legislative provisions with the relevant provisions of the Banking Act and the regulations made under it, it is, I think, instructive to observe that where differing penalties have in the past been prescribed according to whether an offence is prosecuted summarily or upon indictment, it has been thought necessary to provide for the mode of prosecution by statute and it has not been thought that the discretion to choose the mode of prosecution is to be found in a provision such as s. 70 of the Banking Act. A clear example is to be seen in s. 22 of the Air Navigation Act 1920 (Cth), which provides as follows:

"(1) A person who contravenes or fails to

comply with a provision of this Act is guilty of an offence.

...

(3) An offence against this Act may be

prosecuted either summarily or upon indictment, but an offender is not liable to be punished more than once in respect of the same offence.

(4) The punishment for an offence against

this Act is -

(a) if the offence is prosecuted summarily - a fine not exceeding $400 or imprisonment for a term not exceeding 6 months, or both; or

(b) if the offence is prosecuted upon indictment - a fine not exceeding $1,000 or imprisonment for a term not exceeding 2 years, or both, or, if the offender is a body corporate, a fine not exceeding $10,000.

(5) Proceedings for the commitment of a

person for trial on indictment for an offence against this Act shall not be instituted except with the consent in writing of the Secretary.

(6) Proceedings for the summary prosecution

of an offence against this Act shall not be instituted except with the consent in writing of the Secretary or a person authorized by the Secretary, by writing under his hand, to give such consents.

... "

The comparison emphasizes, in my view, the insuperable difficulties to be found in any construction of s. 70 of the Banking Act which has that section itself conferring a choice as to the mode of prosecution of an offence. It also, in my view, emphasizes that no power is to be found in s. 39(2)(q) of the Banking Act to confer such a choice by an implication contained in a regulation.

16. These proceedings come before us by way of demurrer to the whole of the action in which the plaintiff claims a declaration that regs 40 and 42 are void and of no effect. No question is raised by the defendants concerning the locus standi of the plaintiff to claim that relief. For the reasons which I have given I think that the demurrer should be overruled and that the plaintiff should have his declaration in relation to that part of reg. 42 which refers to penalty. No argument has been advanced which would indicate that reg. 40 is beyond power and the fact that no penalty is prescribed for breach of the prohibition which it imposes does not affect its validity, although it will preclude any prosecution for its breach. It was submitted that if reg. 42 fails to provide a penalty then the offence which is nevertheless created will be an indictable misdemeanour at common law which carries no fixed penalty. See Ex parte Gerard &Co. Pty. Ltd.; Re Craig (1944) 44 SR (NSW) 370, at p 375. That may ordinarily be the effect of the creation of an offence without the prescription of a penalty but it clearly cannot be so where a contrary intention is statutorily expressed. Such a contrary intention is to be found in s. 39(2)(q) of the Banking Act which provides for the prescription by the Governor-General of penalties for offences against the regulations not exceeding the specified maximum. Quite plainly that provision is inconsistent with the creation of a common law misdemeanour with an unlimited penalty. Thus there can be no penalty imposed for any breach of the prohibition imposed by reg. 40 and the continuation of the proceedings against the plaintiff, even if possible, would be futile. The plaintiff claims an injunction against the continuation of those proceedings but having regard to the declaration which the plaintiff is, in my view, entitled to, it is unnecessary to consider that claim further.

17. I should only add that this Court has recently expressed its view that it is undesirable to interrupt criminal proceedings by applications made to it in the ordinary course of those proceedings. See Reg. v. Iorlano (1983) 58 ALJR 22. In these proceedings, however, the defendants have raised the issue by way of demurrer and, having heard argument upon both sides, it is appropriate to grant relief.

18. I would overrule the demurrer and declare that reg. 42 is void and of no effect in so far as it purports to impose a penalty for any offence.

Orders

Demurrer allowed.

Judgment for the defendants in the action with costs.