Smith v Capewell

[1979] HCA 48

HIGH COURT OF AUSTRALIA

Barwick C.J., Gibbs, Stephen, Mason, Murphy and Aickin JJ.

SMITH v. CAPEWELL

(1979) 142 CLR 509

4 October 1979

Constitutional Law (Cth)

Constitutional Law (Cth)—Freedom of interstate trade, commerce and intercourse—Sale of goods—Goods imported from one State to another—Contract of sale made in State of delivery—Source not stipulated—Goods brought from other State to fulfil contract—Whether interstate trade—Statutory control of skin dealers—Prohibition of carrying on business of skin dealer without licence—Carrying on business—The Constitution (63 &64 Vict. c. 12), s. 92—National Parks and Wildlife Act, 1974 (N.S.W.) s.105 (a).

Decisions

Oct. 4.
The following written judgments were delivered: -
BARWICK C.J. The respondent is a dealer in, amongst other things, kangaroo skins. His place of business is in Charleville, Queensland. He obtains such skins in Queensland, having authority under the legislation of that State to be in possession of them. He obtains from time to time authority under that legislation to sell them to purchasers, including purchasers in other States. (at p511)

2. The respondent sold certain kangaroo skins which he had procured in Queensland to a purchaser in New South Wales. He delivered them from Queensland to the buyer in New South Wales. However, the purchaser rejected the skins for disconformity with the contract of sale. The respondent thereupon sold these skins (the rejected skins) to another purchaser in New South Wales. (at p511)

3. The respondent also sold to the same purchaser other kangaroo skins which he brought from Queensland and delivered in New South Wales in satisfaction of the purchase. This transaction I will refer to as the "other sale". (at p511)

4. But in neither contract of sale was there a stipulation that the skins be delivered from Queensland into New South Wales. The export of all these skins from Queensland into New South Wales was covered by an authority under the legislation of that State. (at p511)

5. The respondent was charged with a breach of s. 105 (a) of the National Parks and Wildlife Act, 1974 (N.S.W.), as amended ("the Act"), which sub-section I set out in full:
"A person shall not -
(a) exercise or carry on; . . . the business of a skin dealer, unless he does so under and in accordance with the authority conferred - (d) by a skin dealer's licence under section 125; or (e) in so far as the act constituting the offence forms part of the business of a fauna dealer - by a fauna dealer's licence under section 124." The respondent had no such licence under the Act. It is quite clear from the provisions of s. 125 of the Act that such a licence is not obtainable as of right. Its grant lies in the discretion of a government official. (at p512)

6. There was some confusion in the court papers as to the sale which was the subject of that charge. (at p512)

7. The magistrate before whom the respondent was charged appears to have treated the sale of the rejected skins as the subject matter of the charge. But, from a comparison of dates, it would appear that the other sale to the same purchaser was that subject matter. The magistrate found that the respondent had carried on in New South Wales the business of a skin dealer as charged but dismissed the information on the ground that the relevant section of the Act did not validly apply to the transaction, i.e. the sale of the rejected skins, upon which he thought the prosecution had relied to establish the charge because that sub-section transgressed s. 92 of the Constitution. (at p512)

8. This appeal is brought by the prosecution by the special leave of this Court. (at p512)

9. The first question is whether s. 105 (a) infringes the freedom of interstate trade guaranteed by s. 92. The sub-section does not expressly limit its prohibition to the carrying on of business as a skin dealer in New South Wales. But s. 14A (1) of the Interpretation Act, 1897 (N.S.W.), as amended, would effect such a limitation. (at p512)

10. Of course, some part of an interstate trade in animal skins, as indeed of all interstate trade in goods, must take place within each of the States between which the interstate trade takes place. (at p512)

11. If the evidence of the interstate trade be established by proof of the transport of the goods from one State to another, only the actual transit over the border itself will not take place in one State or the other. (at p512)

12. If the existence of the trade is to be made out by proof of contractual arrangements, probably, though perhaps not necessarily, some part of the steps to form the contract would have taken place in each State. But to establish the existence of the trade merely by the existence of a contract, the transport of the subject matter from one State to another must necessarily occur if the contract is to be duly performed. Thus, in general, the evidence of the interstate trade by means only of a contract will only be possible if delivery from one State to another is a term of the contract, express or implied. Of course, if a contract of sale so stipulates, the contract itself is part of interstate trade and commerce. (at p513)

13. But it would seem such a trade may be established where it is implicit in the nature of the transaction relied upon to establish such trade or by a course of dealing, that it was the common contemplation of the parties that the subject matter of their agreement would be transported interstate. Reg. v. Wilkinson; Ex parte Brazell, Garlick &Co. (1952) 85 CLR 467 is, in my opinion, an illustration of such an occasion. It was established in that case that the vendor only sold to the purchaser because the purchaser assured him that he was "buying for interstate". There was no written contract and, in my opinion, the evidence did not go so far as to establish a contractual obligation on the part of the purchaser to transport the potatoes interstate. In fact, he did so: and, clearly, it was in mutual contemplation that he would do so. But as a generalisation it can, in my opinion, be said that only a contract which stipulates for interstate movement or delivery will itself form part of interstate trade. It may also establish the existence of such a trade. (at p513)

14. But it is proper to observe that that instance of a transaction given in W. &A. McArthur Ltd. v. Queensland (1920) 28 CLR 530, at p 540 does not purport to exhaust the way in which interstate trade in goods may take place. The instances given in McArthur's Case were peculiarly relevant to the facts of that case. Transport over the border for sale, whether or not in pursuance of a contract of sale requiring such transport, is clearly part of interstate trade and commerce. To prevent the sale of the delivery on importation of the imported goods must necessarily offend s. 92. (at p513)

15. Here, no doubt, an interstate trade could not be established in relation to the subject skins merely by the terms of a contract of sale. (at p513)

16. In the present instance, on the facts to which I have referred, the respondent was undoubtedly engaged in transporting skins from Queensland to New South Wales for sale in New South Wales, or in performance of a contract of sale, i.e., one which did not stipulate for interstate delivery. He had imported the rejected skins, for delivery to a purchaser and he had imported the skins the subject of the other sale for delivery to a purchaser. (at p513)

17. The sub-section of the Act deals with the carrying on of the business of a skin dealer, without a licence under the Act. Part of the respondent's business in selling skins and transporting them from one State to another for delivery to a buyer in the second State must inevitably take place in New South Wales. If no other part, at least the act of delivery itself; but also the solicitation of business and the negotiation of terms of sale. It is convenient to recall the width of the concept of interstate trade in McArthur's Case (1920) 28 CLR, at p 547 . Therefore, if the sub-section, properly read, would prevent the sale or delivery upon importation of the skins in the course of the business of a skin dealer, it would, in my opinion, be pro tanto inoperative. (at p514)

18. I have elsewhere indicated that sale in the second State of goods brought in the course of business into that State for sale forms part of the interstate trade in the subject matter of the transportation. To forbid the trader who has so imported for sale from selling or delivering the imported article in the second State is, in my opinion, in clear conflict with s. 92. If carrying on business within the meaning and operation of the sub-section embraces the sale upon importation of a commodity brought interstate for sale, it is, in my opinion, inoperative. (at p514)

19. To relate these propositions to the instant case, it is apparent that the skins the subject of the other sale were imported into New South Wales by the respondent for delivery there to the purchaser. (at p514)

20. Although the sale of the rejected skins was not the subject of the charge, I would reiterate that they were imported from Queensland into New South Wales for sale there. The sale of those skins, made subsequent to their rejection, was a sale made immediately on importation. The intervening delivery to and rejection by the original purchaser does not preclude that conclusion. On their rejection the skins did not cease to be skins imported for sale and as yet unsold. The abortive transaction did not act as a mediating circumstance precluding the subsequent sale being a sale immediately on importation; in other words, a first sale on importation for sale. (at p514)

21. Thus, if entering into and completing the transaction with the other skins would constitute carrying on business within the terms of s. 105 (a) of the Act, the section would be inoperative to render the respondent liable under the section because of s. 92. The operation must be confined to purely intrastate activities. (at p514)

22. There is a second approach to this charge which in some sense is but a reflection of what I have already said, namely, one of fact. Did the respondent carry on business as a skin dealer in New South Wales within the meaning of the sub-section? (at p514)

23. The expression "carry on business" would in general refer to some repetitive act in a trade and only rarely be satisfied by the proof of only one transaction. Further, as it appears in the sub-section, the expression necessarily refers to carrying on a business at a place in New South Wales. By this I do not mean that in order to satisfy the sub-section there must be use of business premises: it would suffice if the acts constituting the carrying on of a business occurred in a street without the panoply of an office or shop. But at least the business must be carried on in New South Wales. The fact that the respondent had his place of business in the sense of his office, shop, or headquarters in Queensland does not deny the possibility of concluding that, in relation to some specific period of time, he carried on business in New South Wales. But, allowing that proof of a single transaction may establish the carrying on of a business within the intention of the sub-section, the circumstances under which a single transaction takes place must be considered. Also, the interstate nature of the respondent's operation cannot be left out of consideration when determining whether a particular transaction amounts to carrying on a business in New South Wales. (at p515)

24. Here, if it be thought that the sale in the rejected skins, either alone or in conjunction with the sale of the skins the subject of the other sale, assisted to support a conclusion that a business was being carried on in New South Wales, it should be pointed out that we know the circumstances in which the transaction in the rejected skins took place and it was, as I have indicated, a transaction in the course of interstate trade. The sale to the purchaser who rejected the goods could not possibly be held, in my opinion, for the reasons I have given to be a carrying on or to form part of carrying on of the business in contravention of the sub-section. Both the concluded sales occurred in the "business" of importing goods into the State for sale or for delivery there. If the other sale of skins is relied upon to establish the carrying on of a business, what I have already said equally applies. I would not find that in either case the single sale in the circumstances of this case amounted itself to the carrying on of a business as a skin dealer within the operation of the sub-section; nor would I find that a combination of all the sales warranted that conclusion though they were business transactions entered into by the respondent as a skin dealer, and though the selling took place in New South Wales. (at p515)

25. Thus, in my opinion, whilst I think he was in error in finding that the respondent relevantly carried on business as a skin dealer in New South Wales, the magistrate was correct in dismissing the information. I would dismiss the appeal. (at p515)

GIBBS J. The respondent was charged in the Central Court of Petty Sessions, Sydney, on the information of the appellant that between 1st April 1976 and 10th April 1976 at Botany in the State of New South Wales he did carry on the business of a skin dealer, otherwise than under and in accordance with the authority conferred by a licence issued under s. 124 or s. 125 of the National Parks and Wildlife Act, 1974 (N.S.W.), as amended ("the Act"). The magistrate who heard the proceedings appears to have accepted, or assumed, that the respondent did carry on the business of a skin dealer at Botany, for he said that the only question was whether the respondent was required to hold a licence under the Act or whether he was exempted from that requirement because of the interstate nature of the transaction. He answered that question favourably to the respondent and dismissed the information. (at p516)

2. The evidence was not altogether clear, but there now seems to be no dispute that the following facts were established by the evidence. The respondent carried on business at Charleville, in Queensland, as a fauna dealer, and was registered under the relevant Queensland legislation. However, he did not hold a licence under s. 124 or s. 125 of the Act. In March 1976 the respondent agreed to sell some skins to Furedy and Co., of Botany, but after he had brought the skins to New South Wales he found that the prices offered by that company had dropped and instead sold the skins to Gee Bros. Pty. Ltd., also of Botany. This transaction was completed before 1st April 1976, the former of the dates mentioned in the information, but, in any case, no reliance is placed on it by the appellant, apparently because it is considered to have been of an interstate character. (at p516)

3. Early in April 1976 the respondent called at the premises of Gee Bros. Pty. Ltd., at Botany, and spoke to Mr. Gee, a director of that company, about the earlier transaction. During the discussion, Mr. Gee "negotiated a further order". The evidence did not disclose the precise nature of this further order, but pursuant to it the respondent delivered a quantity of kangaroo skins to Mr. Gee on about 9th April 1976 at Botany, where the skins were off-loaded from the respondent's truck on to one of Mr. Gee's trucks. The skins were obtained in Queensland, and the respondent was granted a permit under the Queensland legislation to remove them from Charleville to Wallangarra, on the border between Queensland and New South Wales. Each skin bore a numbered plastic tag issued by a department of the Queensland Government. Mr. Gee knew that the respondent carried on business in Queensland, and it can be inferred that when he placed the order he believed that the skins would be brought from Queensland, and since the skins were tagged he must have known that they had come from Queensland. However, there was no evidence that it was an express stipulation of the contract that the skins would be brought from Queensland. (at p517)

4. To determine whether the respondent was within the protection of s. 92 of the Constitution, it is necessary to ascertain with precision what were the acts and events which, in the absence of that constitutional guarantee, would render him liable to be convicted of the offence with which he was charged. The section of the Act which created that offence was s. 105, which provides, inter alia, as follows:
"A person shall not -
(a) exercise or carry on; ... the business of a skin dealer, unless he does so under and in accordance with the authority conferred- (d) by a skin dealer's licence under section 125; or (e) in so far as the act constituting the offence forms part of the business of a fauna dealer - by a fauna dealer's licence under section 124." By s. 125 (1) an authorized officer may issue a licence, referred to as a skin dealer's licence, authorizing a person to buy or sell skins as a skin dealer, and otherwise to exercise or carry on the business of a skin dealer. The expression "skin dealer" is defined in s. 5 as follows:

"'Skin dealer' means a person who exercises or carries on- (a) the business of dealing in the skins of protected fauna, whether by buying or selling or by buying and selling, and whether or not he deals in other things; or (b) the business of tanning the skins of protected fauna, whether or not he tans other skins, or both, and whether on his own behalf or on behalf of any other person, and whether or not he exercises or carries on any other business."

"Sell" is defined by the same section to include offer for sale. The expression "carry on" is not anywhere defined. Kangaroos are protected fauna: see s. 5 ("protected fauna") and sch. 11. (at p517)

5. In my opinion, an isolated sale of kangaroo skins, not made in the course of carrying on a wider business of selling such skins, would not be an offence against s. 105 (a) of the Act. The expression "carry on business", in its ordinary meaning, signifies a course of conduct involving the performance of a succession of acts, and not simply the effecting of one solitary transaction. In Smith v. Anderson (1880) 15 Ch D 247 , where the Court of Appeal considered the effect of s. 4 of the Companies Act, 1862 (U.K.) which spoke of an "association...formed...for the purpose of carrying on any... business", Brett L.J. said (1880) 15 Ch D, at pp 277-278 : "The expression 'carrying on' implies a repetition of acts, and excludes the case of an association formed for doing one particular act which is never to be repeated." In Kirkwood v. Gadd (1910) AC 422, at p423 , Lord Loreburn L.C. said: "What is carrying on business? It imports a series or repetition of acts." In the same case Lord Atkinson (1910) AC, at p 431 , referred with apparent approval to the statement of Brett L.J. in Smith v. Anderson (1880) 15 Ch D, at pp 277-278 . Similarly, in Premier Automatic Ticket Issuers Ltd. v. Federal Commissioner of Taxation (1933) 50 CLR 268, at p 298 , Dixon J., in a passage frequently quoted, said that "the carrying on or carrying out of any profit-making undertaking or scheme" in a taxation statute, "appears to cover, on the one hand, the habitual pursuit of a course of conduct, and, on the other, the carrying into execution of a plan or venture which does not involve repetition or system..." The decision in Cornelius v. Phillips (1918) AC 199 is not authority for any different view of the meaning of the expression. It was there held that a money-lender had carried on the business of money-lending at an hotel which was not his registered address although he had effected only one transaction at the hotel. In that case, which was recently discussed and distinguished in Yango Pastoral Co. Pty. Ltd. v. First Chicago Aust. Ltd. (1978) 139 CLR 410 , the single transaction which fell within the statutory prohibition was conducted by a person who was, on any view, carrying on a money-lending business. Similarly, in Lowe v. Cant (1961) SASR 333 , it was held that a milk vendor who had been allotted a zone under regulations governing the supply of milk and who, on one occasion, delivered milk to a householder in another zone, had carried on business as a retail vendor of milk within a zone other than that allotted to him. Again, there was no doubt that the milk vendor was carrying on business as such or that the isolated transaction which occurred outside his allotted zone was done in the course of carrying on that business. In these cases, although the defendant engaged in only one transaction of the kind proscribed, that transaction was done in the course of carrying on a business. A single transaction may amount to the carrying on of a business, although no other transaction has so far been effected, if it is proved that there was an intention to carry on a business and that the transaction was undertaken in pursuance of that intention: Fairway Estates Pty. Ltd. v. Federal Commissioner of Taxation (1970) 123 CLR 153, at pp 164-165 . It seems clear that a solitary transaction of sale or purchase of skins in New South Wales will only constitute an offence against s. 105 (a) of the Act, if the sale of purchase has been made by the defendant with the intention that it shall be the first of several transactions in a business which he thereby commences to carry on, or if it has been made in the course of a business which the defendant is carrying on elsewhere. (at p519)

6. The Act contains in s. 101 a provision which makes it unlawful to sell kangaroo skins unless the case falls with one of the exceptions provided by that section. Section 101 in terms refers, inter alia, to the buying or selling of "any protected fauna" but, by s. 5, "fauna" is defined to include any mammal and "mammal" is defined to include the skin of a mammal. The fact that s. 101 prohibits a sale of kangaroo skins supports the conclusion that s. 105 (a) does not simply duplicate the prohibition, but applies to the case of an individual sale of such skins only if it was effected in the course of carrying on a business. (at p519)

7. The question whether s. 105 (a) would infringe s. 92 of the Constitution in its application to the present case depends on whether the respondent, in the course of carrying on the business of a skin dealer, engaged in acts of interstate trade and commerce. If he did, the section, if it applied, would directly and immediately restrict or burden that interstate trade, for it would prohibit the respondent from carrying on the trade, and although the prohibition would be relaxed if the respondent were licensed, a licence was not obtainable either as of right or if definite and reasonable conditions were satisfied - the grant of the licences was purely discretionary. (at p519)

8. There is no doubt that the agreement made early in April between the respondent and Mr. Gee, considered alone, was an intrastate transaction which the law might validly prohibit. That agreement contained no express stipulation that the skins would be supplied from Queensland, and it was not suggested that there was any necessary implication to that effect. In those circumstances the agreement is indistinguishable from the first and third of the methods discussed in W. &A. McArthur Ltd. v. Queensland (1920) 28 CLR 530, at pp 540, 559-560 , and on the authority of that case, which on this point has often been followed, the agreement, considered in isolation, was not of an interstate character. Moreover, the fact that the respondent carried on business in Queensland as well as in New South Wales did not necessarily mean that he engaged in acts of interstate trade, for "it is very clear that a person may carry on business in every State of the Commonwealth and yet never engage in an act of interstate commerce": Hospital Provident Fund Pty. Ltd. v. Victoria (1953) 87 CLR 1, at p 38 . However, the respondent did in fact engage in acts of interstate trade in carrying on the business. The carriage of the skins from Queensland to New South Wales was beyond doubt an act of interstate trade. The respondent carried the skins in the course of, and for the purpose of, his business as a skin dealer, and completed the carriage by delivering the skins to Mr. Gee. The carrying on by the respondent of his business in New South Wales consisted of one inseverable transaction - he brought the skins across the border and delivered them in pursuance of the order previously placed by Mr. Gee. I cannot distinguish the present case from North Eastern Dairy Co. Ltd. v. Dairy Industry Authority of N.S.W. (1975) 134 CLR 559 . In that case, the owner of goods took them over the border for the purpose of selling them, and it was held that s. 92 protected the sale as well as the carriage. The case was not one in which goods were sold within a State by a person who had bought them from an interstate seller; the person making the first sale within the State had himself brought the goods across the border - he was what Jacobs J. called an "exporter-importer" (1975) 134 CLR, at p 629 . My reason for holding that s. 92 applied was that the sale, although in itself of an intrastate character, was "an inseparable concomitant or consequence" of an interstate transaction (1975) 134 CLR, at p 599 . In the present case also the respondent is an "exporter-importer". It is true that in Northern Eastern Dairy Co. Ltd. v. Dairy Industry Authority of N.S.W. the contract of sale was made after the goods had crossed the border, whereas in the present case the contract of sale may have already been made - at least an order had been placed - before the goods were brought from Queensland to New South Wales. With all respect to those who take a different view, that difference does not seem to be material. In each case the actual carriage of the goods across the border was an act of interstate trade, and the delivery of the skins for the purpose of satisfying an anterior contract or order is just as inseparable from that carriage as was the subsequent sale from the carriage in the North Eastern Dairy Case. Indeed, the argument for regarding the sale and delivery in the present case as inseparable from the interstate carriage is in one respect stronger than that which prevailed in the North Eastern Dairy Case. The sale and delivery to Mr. Gee only came within s. 105 (a) if it occurred in the course of carrying on a business. The circumstances which show that this single transaction was done in the course of carrying on a business also show that an integral part of the transaction was the carriage of the skins by the respondent from Queensland to New South Wales. (at p521)

9. It was not contended in the present case that s. 105 (a) could be upheld as a regulatory measure for the protection of native fauna-no doubt the decision in Fergusson v. Stevenson (1951) 84 CLR 421 inhibited the appellant from advancing any such argument. (at p521)

10. For these reasons, in my opinion, the provisions of s. 105 (a) of the Act could not validly apply to the acts with which the respondent was charged. I therefore consider that the magistrate correctly dismissed the information and that this appeal should be dismissed. (at p521)

STEPHEN J. The respondent, a skin dealer from Charleville in Queensland, in April 1976 visited the premises of a skin-buying firm in Botany, New South Wales, and agreed to sell and deliver to that firm some kangaroo skins. A few days later he delivered the skins to the premises of the Botany buyer. These skins he had obtained in the Charleville district and had processed at his own Charleville works. (at p521)

2. He was later charged, under s. 105 (a) of the National Parks and Wildlife Act, 1974 (N.S.W.), with the offence of carrying on at Botany the business of a skin dealer while not being licensed to do so. The information was dismissed by the magistrate upon the ground that the "transaction", that is the sale of the skins, was "an example of direct trade between the two States" which was directly burdened by the provisions of s. 105: since that burden was not merely regulatory his Worship held it to be offensive to s. 92 of the Constitution. Section 105 was accordingly held to have no valid application. (at p521)

3. On this appeal only two issues arise: one relating to s. 92, the other concerned with whether the respondent was in any event shown to be carrying on business at Botany as charged. As to the latter there was evidence that he did, in the words of s. 105 (a), "carry on the business of a skin dealer" in Charleville and that his visits to Botany in April 1976 were in the course of that business, as had been an earlier visit by him to Botany in March of that year. His sale and delivery of skins at Botany was no isolated transaction but was a part of his regular activities as a skin dealer, albeit that most of those activities were conducted in Queensland. That being so all the ingredients of the offence charged were made out and the only remaining issue is that concerning s. 92. (at p522)

4. It too may be dealt with quite shortly. In my view, the conduct which constituted the offence charged, the sale and delivery of skins to the Botany buyer, was not an instance of interstate trade and does not attract the protection of s. 92. Put another way, the terms of s. 105 have not operated upon any interstate trade of the respondent so as unconstitutionally to burden it and this because that conduct contained no relevant interstate feature. The only interstate flavour lent to the conduct derives from two factors: the respondent's residence in Queensland, where he conducts his principal business activities, and the place of origin of the skins, Queensland. Neither of these factors, whether viewed singly or in combination, suffices to attract to his conduct the protection of s. 92, they do not serve to make the transaction into which he entered one of interstate trade. (at p522)

5. The fact that the places of residence or of business of the parties to a sale of goods are in different States does not confer any interstate quality upon their transaction in trade, nor does the fact that the goods which the vendor sells in fact originate in one State and are carried into another State for delivery to the purchaser there. That movement of the goods will itself be an instance of interstate trade but what is here relevant, the carrying on of business by the vendor in New South Wales, constituted by the sale and delivery in the course of his business activities, itself possesses no interstate character. It would be a different matter if the transaction which constituted the offence of carrying on business while unlicensed was one which stipulated that the skins which the vendor was to sell and deliver were to come from Queensland. Had it done so, the transaction would indeed possess an interstate character. But this was no part of the bargain between the parties. (at p522)

6. As authority for the foregoing propositions it is enough to cite the early case of W. &A. McArthur Ltd. v. Queensland (1920) 28 CLR 530, esp at p 559 , and a recent decision which reaffirmed and applied its doctrine: H.C. Sleigh Ltd. v. South Australia (1977) 136 CLR 475, at pp 495, 507-508 . (at p522)

7. In an appropriate case the constitutional protection of the freedom of interstate movement, as an example of interstate trade, may require that the first sale following that movement should itself be the subject of constitutional protection. That cannot be the case here. Interstate movement may be burdened by restrictions or prohibitions upon the subsequent sale of what is moved, but a sale which precedes the interstate movement and does not, by its terms, call for that movement lacks the character of interstate trade and cannot retrospectively acquire the protection of s. 92 simply because delivery of what is sold turns out to involve such movement. A law which validly applies to the sale at the time it is made, because that sale is no part of interstate trade, will not become unconstitutional because the vendor chooses to perform the contract by supplying goods from interstate. (at p523)

8. I would allow this appeal. (at p523)

MASON J. The respondent, who carries on business as a skin dealer at Charleville in Queensland, is a registered fauna dealer in that State. He was charged in Central Court of Petty Sessions, Sydney, with an offence against s. 105 (a) of the National Parks and Wildlife Act, 1974 (N.S.W.), as amended ("the Act") in that between 1st April 1976 and 10th April 1976 he did carry on the business of a skin dealer otherwise than under and in accordance with the authority conferred by a licence issued under s. 124 or s. 125 of the Act. The magistrate found that the respondent did carry on business as a skin dealer in New South Wales between the dates referred to in the charge and that he did so without a licence. However, the magistrate also found that the respondent's carrying on of business consisted of entry into a transaction of interstate trade and commerce which was protected by s. 92 of the Constitution and that, in consequence, s. 105 (a) did not validly apply to the respondent's activity which was the foundation of the alleged offence. His Worship dismissed the information and ordered the appellant to pay the respondent's costs. From that decision the appellant has appealed to this Court, pursuant to the grant of special leave. (at p523)

2. Section 105 of the Act provides:
"A person shall not -
(a) exercise or carry on; (b) advertise, notify or state that he exercises or carries on or is willing to exercise or carry on; or (c) in any way hold himself out to the public as ready to exercise or carry on, the business of a skin dealer, unless he does so under and in accordance with the authority conferred - (d) by a skin dealer's licence under section 125; or (e) in so far as the act constituting the offence forms part of the business of a fauna dealer - by a fauna dealer's licence under section 124." Section 125 provides:

"(1) An authorised officer may issue a licence (in this Act referred to as a 'skin dealer's licence'), authorising a person to buy or sell skins as a skin dealer and otherwise to exercise or carry on the business of a skin dealer. (2) A person licensed under subsection (1) shall not exercise or carry on business as a skin dealer in New South Wales at or on any premises that are not registered under this section. (3) An authorised officer may issue registration certificates in respect of each of the premises at or on which a person licensed under subsection (1) exercises or carries on business as a skin dealer in New South Wales."

Section 124 makes similar provision for the issue by an authorized officer of a fauna dealer's licence. (at p524)

3. Mr. McHugh for the appellant did not suggest that the application of the prohibition in s. 105 (a) to the carrying on of business in the course of interstate trade could be justified on the ground that it, taken together with other provisions in the Act, constitutes a permissible regulation of interstate trade which does not contravene s. 92. In this respect it seems to have been assumed that the reasoning which led this Court in Fergusson v. Stevenson (1951) 84 CLR 421 to hold that s. 19 (1) of the Fauna Protection Act, 1948 (N.S.W.) had no application to the possession of goods in the course of transport from one State to a port in another State for shipment overseas would have equal application to s. 105 (a) and to its operation in this case. The case for the appellant was that the respondent, in the course of carrying on his business of a skin dealer, entered into a contract for the sale of kangaroo skins in New South Wales without having a licence under the Act, that the contract did not form part of interstate trade and that he therefore fell outside the protection given by the constitutional provision. (at p524)

4. Before I turn to the evidence, I should emphasize that what is prohibited by s. 105 (a) is the carrying on in New South Wales of the business of a skin dealer without a licence. In order to fall within the prohibition it is necessary that the defendant should engage in activities in New South Wales that constitute the carrying on of the business of a skin dealer. It would not be enough, for example, to show that the defendant entered into a single or isolated contract for the sale of skins. If this be all that emerged from the evidence, it could not be said that he was a dealer in skins or that what he did was something done in the course of carrying on the business of a skin dealer. (at p524)

5. Furthermore, s. 105 (a) is directed only to the prohibition of the carrying on of business in New South Wales without a licence. It is not concerned with the premises at or upon which the business is carried on. Section 125 (2) constitutes a separate and distinct prohibition against the carrying on of business at or on any premises that are not registered under the section. Section 125 (3) provides for the issue of registration certificates in respect of the premises at which a licensed person carries on business in New South Wales. Thus it is the function of the registration provisions, rather than the function of the licence, to authorize the carrying on of business at particular premises. (at p525)

6. In the present case the evidence disclosed that the respondent carried on business as a skin dealer at Charleville in Queensland. In the course of the business he sold skins to customers in New South Wales and delivered skins across the border to customers in that State. In the course of carrying on the business he therefore engaged from time to time in transactions of interstate trade, at least by delivering skins across the State border and possibly by entering into contracts for sale which called for the delivery of skins from Queensland to the premises of purchasers in New South Wales. I say "possibly" because the evidence dealt with two transactions only and the critical question is whether the transaction relied upon by the appellant formed part of interstate trade and commerce. (at p525)

7. In argument counsel for the respondent referred to the respondent's business at Charleville as an interstate business or as a business which was itself part of interstate trade. This of course was a misdescription. With the exception of banking business, which has been thought to possess unique characteristics, no business has yet been recognized as itself forming part of interstate trade, though the individual transactions entered into in the course of carrying on that business may form part of that trade. Thus, in Hospital Provident Fund Pty. Ltd. v. Victoria (1953) 87 CLR 1, at pp 14-15, 38-39 , it was held that the business of insurance did not itself constitute interstate trade. And in H. C. Sleigh Ltd. v. South Australia (1977) 136 CLR 475 , it was held that the system of refinery exchange was in the same category: see the discussion at pp. 494-495 and 505-507. (at p525)

8. When the respondent entered into contracts in New South Wales for the sale of skins, and this he did in the case of the two transactions dealt with in evidence, he did so in the course of carrying on his general business as a skin dealer, the headquarters of which were at Charleville. When the respondent said in evidence that he carried on business at Charleville, he did no more than designate Charleville as the headquarters or central place of the business. He did not convey that he had a Charleville business which was separate and disconnected from business transactions into which he entered in New South Wales. The evidence, to which I shall shortly refer, indicates that what he did in New South Wales was done in the course of carrying on his general business. (at p526)

9. I now turn to the evidence with a view to ascertaining whether there was in terms a breach of s. 105 (a) and whether the transaction giving rise to that apparent breached formed part of interstate trade and commerce, as the magistrate found. It was common ground that the respondent had no licence under s. 124 or s. 125. Mr. Gee, a director of Gee Bros. Pty. Ltd., gave evidence for the appellant of two transactions which he had with the respondent involving the sale and delivery of skins. It was the second transaction that was alleged to constitute the prohibited carrying on of business. Mr. McHugh conceded that the first transaction was one which formed part of interstate trade to which s. 105 (a) did not apply. (at p526)

10. Mr. Gee stated that on 15th March 1976 the respondent telephoned and offered to sell a load of green kangaroo skins consisting of reds and greys, the price of the reds being $3.50 each, the price of the greys being $2.50 each. On 23rd March the respondent telephoned to say that the skins were at Hornsby Cold Stores. Gee collected them and delivered them to Etherdon Tannery. After they had been tanned, it was discovered that the skins did not correspond with the skins which had been ordered. These skins had formerly been the subject of an order placed by another purchaser, Furedy &Co. of Botany, New South Wales. The respondent had brought the skins to Sydney to satisfy that order. However, Furedy &Co. were not prepared to pay a sufficient price, with the result that the respondent was compelled to sell them elsewhere and this he did to Gee Bros. Pty. Ltd. (at p526)

11. When, early in April, the respondent called at the premises of Gee Bros. Pty. Ltd., the condition of the skins was discussed and a new price was agreed upon. Gee placed a further order with the respondent in terms identical with the initial order. Delivery was made against this order on 9th April at the premises of Gee Bros. Pty. Ltd. from the respondent's semi-trailer which brought the skins from Queensland. At the time of delivery the respondent produced a Permit to Remove Fauna dated 7th April 1976 which was issued under the Fauna Conservation Act, 1974 (Q.). The Permit stated -
"P. W. &D. A. CAPEWELL

11 BAKER ST. CHARLEVILLE is hereby permitted to remove fauna described in the Schedule hereunder from KENNEDY ST. CHARLEVILLE to WALLANGARRA."

It was subject to a condition which is not presently relevant. The Schedule listed a total of 649 grey and red kangaroo skins and stated that they were consigned to "GEE BROS BOTANY N.S.W.". Wallangarra is a border town situated in Queensland. Nothing turns on the fact that the Permit was in the names of P. W. &D. A. Capewell. (at p527)

12. The respondent gave evidence that the skins which he delivered in satisfaction of the skin order were obtained in the Charleville district and came through his Charleville processing works. (at p527)

13. The magistrate seems to have confused the two transactions. However, that is not a matter of present concern because there is no dispute on the facts. The only question is whether the second transaction formed part of interstate trade and commerce. (at p527)

14. In my opinion that question must be answered in the negative. In order that a contract should form part of that trade and commerce it is necessary that it contain a stipulation calling for the delivery of goods across a State border. There must a promise or obligation to carry from one State to another. It is not enough that the promise to deliver goods may be satisfied by goods that are brought from interstate or even that the parties expect that the promise will be satisfied by goods brought from interstate. What is required is the presence of a binding contractual obligation to bring the goods from another State. I need do no more than refer to the discussion of this question in W. &A. McArthur Ltd. v. Queensland (1920) 28 CLR 530, at pp 540, 559-560 and H. C. Sleigh Ltd. v. South Australia (1977) 136 CLR, at pp 494-495, 507-508 . (at p527)

15. All that can be said here in favour of the respondent is that, having regard to the respondent's place of business and the fact that Queensland evidently was the principal or sole source of his supply of kangaroo skins, it was expected that he would satisfy the order by bringing skins from Queensland. But expectation of the parties is not a substitute for stipulation in the contract. That was decided in Ex parte H. Brazil &Co. Pty. Ltd. (1978) 138 CLR 194 . (at p527)

16. It was decided in North Eastern Dairy Co. Ltd. v. Dairy Industry Authority of New South Wales (1975) 134 CLR 559 that s. 92 protected the first sale of milk made within a State by a person who had transported the milk into that State across a State border for the purpose of sale. Had the contract in question in the present case been made by the respondent after, and not before, his transportation of the skins from Charleville to Sydney, it is very likely that the contract would have fallen within the protection given by s. 92. But this is of no avail to the respondent on the facts as they have been established. (at p528)

17. The acknowledgment that the first sale of goods made within a State by the importer after delivery across a State border falls within the constitutional guarantee is a recognition of the need to protect interstate trade from interference which inhibits the first sale within a State of goods or commodities produced in another State. The consequence is that the constitutional protection attaches to the contract once it is made. (at p528)

18. The same considerations do not apply when, as here, goods are transported across a State border in satisfaction of a contractual obligation which does not call for delivery across a State border. The contract is then already on foot. It is only the interstate delivery that needs and obtains protection under s. 92. At the time when the contract was made, it lacked any characteristic which would mark it as a transaction entered into in the course of interstate trade or connected with that trade. The subsequent delivery of goods across a State border, when that delivery is not called for by the contract, cannot endow the contract with an interstate character which it lacked at the time when it was made. (at p528)

19. In the result I would allow the appeal. (at p528)

MURPHY J. Mr. Smith appeals by special leave against the judgment of Mr. Waller S.M. dismissing an information laid by the appellant on behalf of the National Parks and Wildlife Service which laid the information against the respondent charging that (contrary to s. 105 (a) of the National Parks and Wildlife Act 1974 (N.S.W.), as amended he did carry on the business of a skin dealer otherwise than under and in accordance with the authority conferred by a licence issued under ss. 124 or 125 of the Act. The magistrate held that the provision of the Act was "invalid insofar as it related to the interstate transaction" and that Mr. Capewell's transaction was protected by s. 92 of the Constitution. (at p528)

2. The respondent, a registered fauna dealer in Queensland, sold green kangaroo skins to buyers in New South Wales pursuant to various contracts. One transaction concerned a consignment of skins which had been sent by the respondent from Queensland to a tannery in Botany, New South Wales, but after a dispute with this tannery, sold by the respondent to a licensed skin dealer in New South Wales. The transaction, subject of this information, concerned a sale of skins to the same dealer; the skins also came from Queensland. The facts show that the respondent carried on business as a skin dealer in New South Wales without a licence under ss. 124 or 125. (at p529)

3. The respondent was engaged in trade and commerce among the States even if the purchaser was not. The defendant's trade concerned more than one State (see Gibbons v. Ogden (1824) 9 Wheat 1(6 Law Ed 23) . Buying in one State and taking the goods to another and selling there is trade and commerce among the States, even if the sale is intrastate when regarded in isolation. The application of s. 92 has been bedevilled by the fallacy that there is a rigid separation between intrastate trade and commerce and trade and commerce among the States. Very early the fact that they overlap was recognized. "Commerce among the States must of necessity be commerce with the States" (Gibbons v. Ogden (1824) 9 Wheat, at p 196 (6 Law Ed, at p 70) , see also Barwick C.J. dissenting in Harper v. Victoria (1966) 114 CLR 361, at p 372 ; Attorney-General (W.A.); Ex rel. Ansett Transport Industries (Operations) Pty. Ltd. v. Australian National Airlines Commission (1976) 138 CLR 492, at pp 500-501 ; Buck v. Bavone (1976) 135 CLR 110 at p 135 ). (at p529)

4. The National Parks and Wildlife Act under s. 105 expresses a direct prohibition against a person carrying on business as a skin dealer unless he is licensed as a skin dealer (under s. 125) or as a fauna dealer (under s. 124). Section 92 is not contravened because the Act does not impose, directly or indirectly, any customs duty or any discriminatory fiscal impost. It follows that the magistrate should have found the information proved. Section 175 of the Act provides a monetary penalty for an offence under the Act which suggests that the offence is a civil offence. No submission was made that an appeal does not lie against the dismissal. (at p529)

5. In the circumstances, the appeal should be allowed. (at p529)

AICKIN J. I have had the advantage of reading the reasons for judgment prepared by the Chief Justice with which I am in full agreement. (at p529)

2. I agree that the joint judgment of Knox C.J., Isaacs and Starke JJ. in W. &A. McArthur Ltd. v. Queensland (1920) 28 CLR 530 appears sometimes to be regarded (wrongly in my opinion) as dealing exhaustively with the content of interstate trade for the purposes of s. 92. That judgment examined the four modes of trading engaged in by the plaintiff in that case as set out at p. 540. The case decided, rightly in my respectful opinion, that of those modes only the fourth constituted interstate trade. There is however nothing in that judgment to suggest that the fourth mode constitutes an exclusive statement of what comprises interstate trade nor an exclusive statement of the manner in which interstate trade in goods may occur. That case did not involve any question of the freedom of physical movement of goods or vehicles nor did it deal with the situation of transport of goods across a State border for the purpose of sale in the State of destination by the owner who had arranged such transport. It appears to me that the joint judgment contains nothing which is inconsistent with Hughes &Vale Pty. Ltd. v. New South Wales (1954) 93 CLR 1; (1955) AC 241 nor with the decision in North Eastern Dairy Co. Ltd. v. Dairy Industry Authority of N.S.W. (1975) 134 CLR 559 (at p530)

Orders

Appeal dismissed with costs.