Wakim Ex parte McNally and Ors

The High Court of Australia considered an application for a writ of prohibition in *Wakim Ex parte McNally and Ors*. The applicants, Mr McNally and others, sought to prevent the Commonwealth Director of Public Prosecutions from continuing committal proceedings against them in the Supreme Court of Queensland. The core of the dispute concerned the constitutional validity of certain provisions of the *Corporations Law* as they applied to the applicants, who were directors of companies incorporated in Victoria.

The central legal issue before the High Court was whether the *Corporations Law*, as enacted by the Australian Capital Territory (ACT) legislature and applied by the *Australian Securities and Investments Commission Act 2001* (Cth) to the states, was constitutionally valid. Specifically, the Court had to determine if the Commonwealth Parliament could validly legislate with respect to corporations in a manner that purported to apply to companies incorporated in states, thereby encroaching upon state legislative power. This raised fundamental questions about the division of powers between the Commonwealth and the states under the Australian Constitution.

The High Court held that the *Corporations Law*, as applied to the states through Commonwealth legislation, was invalid. The Court reasoned that the Commonwealth Parliament did not have the constitutional power to legislate with respect to corporations in a way that applied to companies incorporated in the states. Such legislation was found to be beyond the scope of the powers conferred upon the Commonwealth by the Constitution, particularly in relation to the implied prohibition against the Commonwealth legislating in a manner that would impair the constitutional independence of the states. The Court emphasised that the power to regulate companies incorporated in a state resides with that state.

Consequently, the High Court made absolute the order nisi for a writ of prohibition, preventing the committal proceedings from continuing in the Supreme Court of Queensland.