South Australia v Commonwealth

South Australia (the applicant) sought a declaration that the Commonwealth (the respondent) had acted unconstitutionally in its dealings with the applicant concerning the acquisition of land for the purposes of the Adelaide to Melbourne railway. The dispute arose from the Commonwealth's purported exercise of its powers under s 51(xxxvii) of the Constitution, which allows the Parliament to make laws with respect to matters referred to the Parliament of the Commonwealth by the Parliament or Parliaments of any State or States, but not including matters referred by the Parliament of a single State. The High Court of Australia was required to determine the constitutional validity of the Commonwealth's actions.

The central legal issue before the High Court was whether the Commonwealth's acquisition of land for the Adelaide to Melbourne railway was a valid exercise of its constitutional powers. Specifically, the Court had to consider whether the referral of power by South Australia to the Commonwealth under s 51(xxxvii) of the Constitution was effective, given that the Commonwealth's legislation purported to rely on a referral from a single State for a matter that, by its nature, involved more than one State. The Court also had to consider the scope of the Commonwealth's legislative power in relation to inter-state railway construction and the constitutional implications of the Commonwealth's acquisition of land for such a project.

The High Court held that the Commonwealth's acquisition of land was invalid. The Court reasoned that s 51(xxxvii) of the Constitution requires a referral of power from the Parliament of a State, and that such a referral must be of a matter that is within the legislative competence of that State. In this instance, the matter of constructing a railway between South Australia and Victoria was not a matter within the exclusive legislative competence of South Australia alone, but rather a matter that necessarily involved the legislative powers of both states. Therefore, a referral from South Australia alone was insufficient to empower the Commonwealth to legislate in relation to this inter-state project. The Court applied the principle that the Commonwealth's legislative power under s 51(xxxvii) is limited to matters referred by the Parliaments of the States, and that such referrals must be constitutionally valid.