Morgan v Commonwealth

Arthur Edward Morgan, a butcher and small goods manufacturer, and certain of his employees were indicted for conspiracy to supply rationed meat unlawfully and for black marketing offences. Concurrently, Morgan commenced actions against the Commonwealth and the Rationing Commission, and the Commonwealth and the Commonwealth Prices Commissioner, challenging the validity of Rationing Order No. 37 and Prices Regulation Order No. 1817, respectively, and their subsequent amendments. These orders, which applied only to Victoria, were alleged to contravene section 99 of the Constitution. The matters were referred by Dixon J. to the Full Court of the High Court for determination.

The legal issues before the Full Court concerned the validity of the National Security (Rationing) Regulations and the National Security (Prices) Regulations, and the specific orders made thereunder, particularly in relation to section 99 of the Constitution, which prohibits any law or regulation of trade or commerce from giving preference to one State or part of a State over another. The court was required to determine whether the rationing and pricing orders, by reason of their differential application or the prices they fixed across different states or parts of states, constituted a contravention of section 99. Additionally, the court considered whether these regulations and orders were validly made under the defence power of the Constitution, or if they were laws with respect to trade and commerce, and whether the Rationing Commission was empowered to make orders not applicable generally throughout Australia.

The Court held that sections 98 to 102 of the Constitution should be read as applying only to laws that could be made under the power conferred by section 51(i). It found that the National Security (Rationing) Regulations, National Security (Prices) Regulations, and the orders made under them were provisions with respect to defence. Although these regulations had effects on trade and commerce, they were not laws or regulations of trade or commerce within the meaning of section 99 of the Constitution because they could not have been made by virtue of the legislative power conferred by section 51(i). The Court also determined that the Rationing Commission was empowered by the relevant regulations to make an order relating to the rationing of goods that was not applicable generally throughout Australia.

The Court's determination meant that the challenges to the validity of the rationing and pricing orders based on section 99 of the Constitution failed. Consequently, the indictments against Morgan and his employees for conspiracy and black marketing offences, which relied on the validity of these orders, would proceed. The Court did not make specific orders regarding the outcome of the criminal proceedings but clarified the legal basis for the regulations and orders in question.