R v Gates

The case of *R v Gates* involved a prosecution under the *Secret Commissions Prohibition Act 1919* (NSW). The accused, Silas Young Maling, was an agent for the Municipal Council of Sydney and was charged with corruptly receiving a substantial sum of money from Babcock & Wilcox Ltd. This payment was alleged to be a reward for recommending the Council to accept the company's tender for steam-raising plant for a power station. The contract between the Council and Babcock & Wilcox Ltd. involved the supply and erection of this plant, with a significant portion of the materials to be manufactured overseas and imported into Australia. The matter was removed to the High Court of Australia from the Supreme Court of New South Wales due to a constitutional question concerning the potential inconsistency between Commonwealth and State legislation.

The central legal issues before the High Court were whether the contract for the steam-raising plant constituted "trade and commerce with other countries" within the meaning of section 51(I) of the Australian Constitution, and consequently, whether the Commonwealth's *Secret Commissions Act 1905* applied to the exclusion of the New South Wales Act. The applicant argued that if the State Act purported to apply to transactions involving foreign trade, it was invalid due to inconsistency with the Commonwealth Act. A further issue concerned the admissibility of certain statements made by the applicant to a police inspector, which the applicant contended were improperly admitted as evidence due to being induced by threats.

The High Court, by majority, held that the contract, on its true construction, was an entire and indivisible contract for the provision of work and materials to create a complete steam-raising plant, affixed to the land in New South Wales. This was not considered to be "trade and commerce with other countries" for the purposes of section 51(I) of the Constitution, even though materials were imported. Therefore, the Commonwealth *Secret Commissions Act 1905* did not apply to the transaction. Consequently, the provisions of the New South Wales *Secret Commissions Prohibition Act 1919* were not invalid due to inconsistency with the Commonwealth Act. The Court also found that the statements made by the applicant to the police inspector were voluntary and properly admitted into evidence.

The rule nisi for a writ of prohibition was discharged, and the conviction of Silas Young Maling under the New South Wales Act was affirmed.