diction of the High Court, i.e., its power to exercise the judicial power of the Commonwealth, shall be exclusive of the jurisdiction of the several Courts of the States except as provided by that section. Without the proviso the jurisdiction of the State Courts would have been entirely ousted. But the Parliament might on the next day have passed another law investing the State Courts with Federal jurisdiction. And the fact that they proceeded to do so by the same Act can make no more difference in the result than the fact that a power of revocation and new appointment is exercised by one instrument instead of two. The result is that the jurisdiction of the State Courts is now derived from a new source, with all the incidents of jurisdiction derived from that new source, one of which is an appeal in all cases to the High Court."

Mr. Justice ISAACS held that State jurisdiction was the authority which State Courts possess to adjudicate under the State Constitutions and laws; Federal jurisdiction was the authority to adjudicate derived from the Commonwealth Constitution and laws. The first is that which "belongs to "the State Courts within the meaning of section 77; the latter must be " vested in " them by Parliament. Now section 77 (II.) is a power to exclude jurisdiction, and this power has been exerted in this first sub-section of section 39, the result being that, so long as the provision stands unrepealed, no State jurisdiction can exist. Section 77 (II.) on the other hand, is a power to invest with Federal jurisdiction, not to restore State jurisdiction, and an exercise of that power in sub-section (2) of section 39 of the Judiciary Act is no contradiction of the deprivation contained in the prior sub-section, and works no restoration of the State jurisdiction. It is, therefore, clearly an error to say that the Federal Parliament has in the same section purported to take away and to return the same jurisdiction, with or without the power of appeal to the Privy Council, or that the conjoint effect of sub-sections (1) and (2) of section 39 of the Judiciary Act is to leave the jurisdiction of the State Courts as it previously stood. They still have jurisdiction in respect of the same subject matters, but their authority to exercise judicial power with regard to those matters springs from another source quite as much as if an Imperial Act had enacted by one section that their State jurisdiction should cease, and by the next section that henceforth they should have similar jurisdiction but should exercise it under the authority of that Statute. The authority which is given by section 39-namely, Federal jurisdic

66

tion-has never been taken away, because it had never belonged to a State Court; that which was taken away-namely State jurisdiction has never even nominally been returned. Section 39 (2) confers Federal jurisdiction" only; none other is in the power of the Commonwealth Parliament to grant, and in the result either the State Courts possess Federal jurisdiction only in these matters or they possess none at all.”

'I feel no doubt that the State Courts in these cases possessed, and necessarily exercised Federal jurisdiction, and that these appeals are competent." Per ISAACS, J., 4 C.L.R., at pp. 1142-1145.

Baxter v. Commissioner of Taxation.

The preliminary objection having been over-ruled, the Court proceeded to deal with the main constitutional issues involved, namely, the liability of Commonwealth officers to State taxation. The majority of the Court, per GRIFFITH, C.J., BARTON and O'CONNOR JJ. held that the High Court was, by the Constitution, the ultimate arbiter upon all such questions, unless it was of opinion that the question at issue in any particular case was one upon which it should submit itself to the guidance of the Privy Council. It was, therefore, not bound to follow the decision in Webb v. Outtrim, (1907) A.C., 81, but should follow its own considered decision in Deakin v. Webb, (1901) 1 C.L.R., 585, in which it had refused to grant a certificate under section 74, unless upon a reconsideration of the question for whatever reason it should come to a different conclusion. Assuming the fact that the Privy Council had given a decision in direct conflict with the High Court on the same point to be a sufficient reason for a reconsideration of the whole matter by the High Court, there was nothing in the reasons of the Judicial Committee to throw any new light on the question involved, either with regard to the necessity for the implication of the rule of implied prohibition laid down in M'Culloch v. Maryland, 4 Wheat., 316, and adopted in D'Emden v. Pedder, 1 C.L.R., 91, or as to the applicability of the rule to the particular question. The rule in D'Emden v. Pedder, 1 C.L.R., 91, was therefore reaffirmed and the appeal was allowed: Baxter v. Commissioner of Taxation (N.S.W.), (1907) 4 C.L.R., at p. 1088.

Mr. Justice ISAACS was of opinion that, apart from any consideration of its history, the words of section 74 of the Constitution were clear and strong enough to lead to the conclusion that on questions coming within the section the decision of the High Court was final, and, therefore, the Court had a right to decline to follow

L.P.

47

the decision of the Privy Council upon any such question, but the respect and weight due to the judgment of the Privy Council made it the duty of the High Court under the circumstances to re-consider the question decided in Deakin v. Webb, 1 C.L.R., 585. Further consideration, in the light of the decision in Webb v. Outtrim, (1907) A.C., 81, left the authority of D' Emden v. Pedder, 1 C.L. R., 585, unimpaired, but the Land and Income Tax Act of New South Wales, considered apart from authority, could not be regarded as an infringement of the rule of non-interference laid down in the latter case.

Mr. Justice HIGGINS held that the King in Council being still the appellate Court from the High Court, and the High Court a Court from which appeal can be brought to the King in Council, it was the duty of the High Court to accept the decision of the King in Council as the final statement of the law. The Land and Income Tax Act of New South Wales was not, in his opinion, an interference with Federal instrumentalities.

The whole Court held that even if section 39, sub-section (2) (a) of the Judiciary Act 1903 purported to take away the right of appeal to the Privy Council, and the section was to that extent ultra vires and inoperative, its failure in that respect did not affect the validity of the grant of Federal jurisdiction to State Courts contained in the rest of the section and the consequent right of appeal to the High Court. The certificate for leave to appeal to the Privy Council was refused.

Flint v. Webb.

The case of Flint v. Webb, which was a similar proceeding by the Victorian Commissioner of Taxes to recover State income tax against Arthur L. Flint, a Commonwealth officer, was argued in the Melbourne sittings of the High Court in May 1907 and the decision of the main question was given at the same time as that in Baxter's Case and was to the same effect. Consequently notwithstanding the decision of the Privy Council in Webb v. Outtrim, the whole of the Commonwealth officers, except Mr. Outtrim, by the decision of the High Court, escaped State taxation: 4 C.L.R., 1178.

Proceedings against Commonwealth or State.

78. The Parliament may make laws conferring rights to proceed against the Commonwealth 143 or a State in respect of matters within the limits of the judicial power.

§ 143. "PROCEED AGAINST THE COMMONWEALTH."

By the Judiciary Act 1903, Part IX., provision is made for the institution and conduct of suits by and against the Commonwealth and the States, as follows:-(1) Suits in contract or tort of any person against the Commonwealth. (2) Suits in contract or tort of any person against a State in respect of a matter in which the High Court has jurisdiction. (3) Suits in contract or tort by a State against the Commonwealth. (4) Suits by a State against a State. (5) Suits by the Commonwealth. No execution or attachment, or process in the nature thereof, shall be issued against the property or revenues of the Commonwealth or a State in any such suit; but when any judgment is given against the Commonwealth or a State, the Registrar shall give to the party in whose favour the judgment is given a certificate in the form of the Schedule to this Act, or to a like effect. On receipt of the certificate of a judgment against the Commonwealth or a State the Treasurer of the Commonwealth or of the State as the case may be shall satisfy the judgment out of moneys legally available. When in any such suit a judgment is given in favour of the Commonwealth or of a State and against any person, the Commonwealth or the State, as the case may be, may enforce the judgment against that person by process of extent, or by such execution, attachment, or other process as could be had in a suit between subject and subject.

Claims against the Commonwealth.

In an action brought by Thomas Henry Gyton against Frank Leon Outtrim, Deputy Postmaster-General of Victoria to recover damages for injuries sustained by reason of the negligence of persons in the service of the Commonwealth it was held by Mr. Justice HOOD that apart from Statute the Crown was not liable for the negligence of its employees. Taking that proposition to be correct, he said, until the Claims against the Government Act 1902 was passed there was no cause of action against the Commonwealth because the Commonwealth was not liable for the wrongful act of the person who caused the injury. Then that Act steps in and practically enacts that the Commonwealth shall be liable for the wrongful act of its servants and employees, so completing a cause of action at that time incomplete. That shows that the Act is not a mere procedure Act: Gyton v. Outtrim, (1904) 29 V.L.R., 646; 25 A.L.T., 174; 10 A.L.R., 67.

Action for Tort against the Commonwealth.

The Commonwealth is responsible in an action for the tortious acts of its servants in every case in which the gist of the cause of action is an infringement of a legal right, if the act complained of is not justified by law, and the person doing it is not exercising an independent discretion imposed upon him by Statute, but is performing merely a ministerial duty. The Collector of Customs, New South Wales, pending the passing of entries, took and detained certain imported goods liable to ad valorem duty for the purpose of ascertaining their true value for duty, and upon the passing of the entries delivered the goods to the importer. It was decided by the High Court that, in refusing to pass entries until the ascertainment of the true value for duty, the Collector was performing a quasijudicial duty prescribed by the Statute to be performed by him personally, in the performance of which he was required to exercise independent judgment on a preliminary question of fact, and that an action would not lie against the Commonwealth for a wrongful refusal to pass entries owing to a mistake of facts or even mala fides on the part of the Collector. Tobin v. The Queen, 16 C.B.N.S., 310, and Enever v. The King, 3 C.L.R., 969, followed. Barry v. Arnaud, 10 A. & E., 646, and Barrow v. Arnaud, 8 Q.B., 595, distinguished. It was further held, that the neglect or refusal by the Customs Department to furnish the importer with copies of books and documents impounded or retained under sections 214 and 215 of the Customs Act 1901 was a breach of an absolute duty cast by the latter section on the department, for which an action would lie against the Commonwealth; and that, though the impounding and retaining of the books and documents in the first instance were justified by the Act, the unreasonable detention of them after the expiration of the period necessarily occupied in the ascertainment of the value of the goods was unlawful, and rendered the Commonwealth liable to an action for conversion; but that, in either case, the damages recoverable were limited to the pecuniary loss actually suffered by the plaintiff by reason of the wrongful acts: Baume v. Commonwealth, (1906) 4 C.L.R., 97.

Tortious act of Commonwealth Servant.

In the case of Strachan v. The Commonwealth, (1906) 4 C.L.R., 455, the plaintiff, owner of a British ship called the Envy brought an action against the Commonwealth to recover damages in respect of alleged wrongful acts of officers of the British Possession of New