Constitutional Implications in Australia
351
12.1.2. Federalism
In the domain of federalism, two implied doctrines operate, albeit in different
ways and to different degrees, to protect the structural integrity of the state and
Commonwealth governments: the Melbourne Corporation and Cigamatic
doctrines.
The High Court relies on the Melbourne Corporation doctrine to protect
the role of the states under the Constitution. This doctrine holds that the
Commonwealth may not interfere with the states as independent constitu-
tional entities within the Australian federal system.
The current iteration of the principle was first identified in 1947, in
Melbourne Corporation v.
Commonwealth, as the basis of a decision by
the Court striking down attempts by the Commonwealth Parliament to
compel state governments (and their instrumentalities) to bank with the
Commonwealth Bank of Australia.
31
The Court reasoned that, while giving
broad power to the Commonwealth Parliament to make various laws under
section 51 of the Constitution, the Constitution also contemplated both ‘a cen-
tral government and a number of state governments separately organised’, or
‘the continued existence [of states] as independent entities’.
32
This, a majority
of the Court found, further implied a limitation on Commonwealth power
preventing the Commonwealth from passing laws ‘preventing a state from
continuing to exist and function’ as an independent entity, or ‘restricting or
controlling’ a state in the exercise of its constitutional functions. Justice Dixon
in particular also emphasised the connection between this limitation and the
notion that the Commonwealth does not have power to pass laws imposing
‘special burdens’ or ‘disabilities’ compared to other actors.
In subsequent cases, the Court has repeatedly affirmed the status of the
Melbourne Corporation doctrine as an independent (implied) limitation on
Commonwealth power, not simply a limitation on the kinds of laws that may
reasonably be characterised as within the scope of the Commonwealth’s express
power under section 51.
33
For the last thirty-five years at least, the only debate
as to the scope of the doctrine has been as to the relationship between the
first and second aspects of the Court’s reasoning in Melbourne Corporation –
i.e., the concern with the continued existence of states of independent entities
and the principle of non-discrimination identified by Dixon J. In the Court’s
31
(1947) 74 CLR 31.
32
Ibid.
, 82 (Dixon J).
33
See
Fairfax v.
Federal Commissioner of Taxation (1965) 114 CLR 1;
Victoria v.
Commonwealth
(1971) 122 CLR 353 (‘Payroll Tax Case’) (Menzies, Walsh Gibbs JJ) (Barwick CJ, McTiernan J
dissenting); Commonwealth v. Tasmania (1983) 158 CLR 1.
352
Rosalind Dixon and Gabrielle Appleby
more recent jurisprudence, Austin
34
and Clarke,
35
it has held that the doctrine
is best articulated as a single, unified principle, with discrimination only one
of several indicators of whether the limitation is in fact engaged.
In its various formulations, the Court has applied the doctrine across a wide
variety of important policy areas limiting the Commonwealth’s capacity to
affect state governments. These have included industrial relations, tax and
superannuation, education and environmental policy.
36
Most notably, the
Court has held that the principle protects the states’ autonomy in determin-
ing the terms and conditions of higher-level employees,
37
and the numbers
and identity (although not minimum conditions) of all other employees.
38
In
Austin and
Clarke, the Court also held that the principle prevents the
Commonwealth from levying certain kinds of superannuation tax on state
judicial and legislative officers, which might have the capacity to impair the
ability of states to recruit and retain suitably qualified individuals.
The High Court has implied a markedly broader protection for the
Commonwealth and its constitutional powers, known as the Cigamatic doc-
trine. This doctrine was first recognised by Dixon J in his dissent in the 1947
decision In re Foreman & Sons Pty Ltd; Uther v. Federal Commissioner of
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