High Court of Australia Barwick C.J. Taylor, Menzies, Windeyer and Owen JJ. O'Sullivan v Miracle Foods (SA) Pty Ltd [1966] HCA 64 ORDER Complaints alleging offences under s. 23 of the Margarine Act, 1939-1956 and reg. 6a (6) of the Margarine Regulations, 1930 dismissed. Defendant convicted of the offence alleged under s. 24 (a) of the Margarine Act, 1939-1956 and this matter remitted to the magistrate to be dealt with according to law. Complainant to pay two-thirds of defendant's costs in High Court including proceedings taken to remove prosecutions to High Court. Cur. adv. vult. The following written judgments were delivered: Sept. 9 Barwick C.J. Miracle Foods (S.A.) Pty. Limited (the defendant) was charged before a stipendiary magistrate in the Adelaide Police Court upon the complaint of J. L. O'Sullivan (the complainant) with three offences under the Margarine Act, 1939-1956 (the Act) and the Regulations made thereunder (the Regulations). The first charge was that the defendant on a specified date in a suburb of Adelaide had sold, or had in its possession for sale, margarine in a package on which there was not written or printed in bold faced sans serif black capital letters not less than 30 points face measurement the word "margarine" contrary to the provisions of s. 24 of the Act. The second was that on the same date at the same place the defendant sold, or offered for sale, table margarine in respect of the manufacture of which records had not been kept as required by reg. 6a (6) of the Regulations. The third was that on the same day and at the same place the defendant sold, or had in its possession for sale, margarine of which less than one-tenth of one per centum by weight consisted of dry starch or arrowroot intimately mixed with the other constituents of the margarine, contrary to s. 23 of the Act. At the hearing of these charges, a good deal of evidence was led by the complainant and by the defendant. Having reserved his decision, the magistrate prepared reasons for judgment by which he proposed to convict the defendant on all three charges. At this point the matter was removed into this Court by an order made under s. 40 of the Judiciary Act. Upon the matter being called on for hearing in this Court, and after some discussion with the Court, by consent, the complaints and the charges were amended by deleting from the first and third complaint and charge the words "or had in its possession" and from the second complaint and charge the words "or offered for sale". In the result, therefore, each charge is in respect of selling packaged margarine in the particular circumstances respectively alleged. The evidence given before the magistrate warrants the conclusion that the defendant had sold in South Australia packaged margarine on which the word "margarine" was not printed in bold face sans serif black capital letters of not less than 30 points face measurement. The word "margarine" was in fact very prominently displayed on the defendant's package in letters of the required kind in the requisite bold face sans serif type but there may be some small room to question whether they were printed in jet black or in such a deep blue-black as to be indistinguishable from black as that shade is spoken of and identified in common usage. However, in any case, the letters are of only twenty-four points face measurement. The difference between twenty-four and thirty points face measurement is, we are told, about one-twelfth of an inch. There was some evidence that the records for which reg. 6a (6) called were not in fact kept but in any case the defendant in this Court made it plain that it did not seek to take advantage of whatever deficiency there was in that evidence. It conceded that in fact there were no records kept as required by the Regulations. The evidence also established that the margarine sold on the day in question by the defendant did not contain one-tenth of one per centum by weight of dry starch or arrowroot; indeed, it contained no starch or arrowroot at all. The matter thus turns exclusively upon the applicability of the Act and the Regulations to the transactions in question having regard to constitutional considerations. There is no question but that the sale which is forbidden by the Act and Regulations is the sale of packaged margarine in South Australia; and, in my opinion, there is also no question that the prohibition is universal in respect of all persons who sell and all sales of such margarine in South Australia irrespective of the place of manufacture of the margarine. In other words, the Act and Regulations in the relevant respect, apart from the operation of s. 3 (2), cannot be construed as limited to the sale of packaged margarine manufactured by a South Australian manufacturer or to any particular category of sale. The Act and Regulations as now amended are at pains to emphasize that no such limitation is intended: see particularly s. 25a. However, s. 3 (2) of the Act requires its construction subject to the Commonwealth Constitution and so as not to exceed the legislative powers of the State. Consequently, the question in this case is whether or not s. 23 and 24 and reg. 6a (6) could validly operate in terms with respect to the sale in South Australia of margarine manufactured outside South Australia and brought thereto for sale; for the defendant only sells margarine which is manufactured in New South Wales which it purchases from the manufacturer and brings to South Australia for sale there. Section 24 (a) which is the foundation of the first charge is in the following terms: "24. No person shall sell or have in his possession for sale—(a) any margarine in a package unless there is written or printed on the package in boldfaced sans-serif black capital letters of not less than 30 points face measurement the word "margarine":". Section 25a inserted in the Act by amendment in 1941 reads as follows: "Every provision of this Act relating to—(a) the entry and search of any place where table margarine or any fats, oils, or other substance commonly used in the manufacture of table margarine are suspected to be stored, packed, or sold; (b) the inspection and obtaining samples of any such table margarine or other substance; (c) the inspection and making copies of and taking extracts from any accounts, books, or documents relating to table margarine or any such substance; (d) the securing of information as to table margarine or any such substance; (e) the sale and having in possession for sale of any table margarine or other such substance; (f) the ingredients of table margarine; (g) the making of regulations, shall apply in relation to all table margarine and every such other substance in the State irrespective of whether that table margarine or other substance was or was not manufactured in the State." Regulation 6a was inserted in the Regulations after the enactment of s. 25a. Its relevant provisions are as follows: "6a (2) All ingredients, used in the manufacture of table margarine, shall be submitted for inspection by an inspector before such ingredients are used in the manufacture of table margarine, and no table margarine (whether manufactured in South Australia or elsewhere) shall be sold or offered for sale or placed on the market in South Australia, unless, prior to manufacture, the ingredients thereof have been submitted for inspection, and approved by an inspector, in accordance with these regulations. (4) Where table margarine, which is manufactured outside South Australia, is sold or offered for sale or marketed in South Australia, or is intended so to be, the ingredients shall be submitted for inspection and inspected, at an inspection depot in South Australia provided by and at the expense of the manufacturer and approved by the Minister. (6) No person shall sell, offer for sale, or place on the market in South Australia any table margarine unless, in respect of the manufacture thereof, records have been kept showing: (a) that the ingredients thereof have been submitted for inspection and approved by an inspector in accordance with these regulations: (b) the time when and the person by whom such ingredients have been submitted as aforesaid, and the date of such approval: (c) the quantities of each ingredient approved as aforesaid: (d) satisfactory evidence that the said table margarine sold, offered for sale, or placed on the market in South Australia has been manufactured solely from ingredients all of which have been approved pursuant to these regulations." Sub-regulation (7) gives the Minister power "to require any person who sells, offers for sale or places on the market in South Australia, any table margarine (whether manufactured in South Australia or elsewhere), to produce or cause to be produced within five days from the receipt of such notice such records as are mentioned in the last preceding sub-paragraph, for inspection by an inspector", and it is provided that in the case of table margarine manufactured elsewhere the records shall be produced at such place in South Australia as the Minister nominates. The prohibition on sale in sub-reg. 6a (6) is thus in terms a prohibition universally binding on those who sell, offer for sale, or place on the market in South Australia any table margarine wherever manufactured unless the ingredients from which the margarine is manufactured were first submitted in South Australia for inspection by South Australian inspectors, and that records are made and preserved showing that these inspections have taken place and that evidence is available in such records that the table margarine sold, offered for sale, or placed on the market in South Australia has been manufactured solely from the ingredients all of which have been approved pursuant to these Regulations. Section 23 of the Act provides that: "No person shall manufacture, sell or have in his possession for sale any margarine unless one-tenth of one per centum by weight of such margarine consists of dry starch or arrowroot intimately mixed with the other constituents of the margarine." It is clear from the evidence that starch or arrowroot in any proportion is not an ingredient of margarine as such. It is a substance foreign to the manufacture of margarine. We are told that the purpose of insisting that the stated proportions of arrowroot or starch should be mixed into the margarine is to facilitate the detection by the inspectors of the South Australian Government of margarine and thus, so it is said, to prevent it masquerading as butter. It would appear that there is no arrowroot or starch naturally found in butter, and that neither is found in margarine unless in compliance with the law of South Australia. Thus the finding of the stated proportion of arrowroot or starch in the substance does not itself establish that the substance is margarine or table margarine. It merely establishes that the law of South Australia in this respect has been observed. It is quite clear that no question of health or safeguard from danger to human life is involved in the requirement of the intermixing of the arrowroot or starch in the margarine. Finally, it is conceded that it would be quite impracticable to attempt to introduce the arrowroot or starch into the margarine except at the point of and as part of the process of manufacture. I shall deal with the charges in the order I have described them. The Act and Regulations are dealing with a substance which is being sold in a packaged condition. It must be contemplated that the package will be opaque. The situation is quite different, to take a recent example, from that of the sale of a hen egg which is identifiable as such between vendor and purchaser without being specifically branded. In my opinion, in relation to dealings between buyer and seller of a commodity which either of necessity must be, or is in the ordinary course of commercial dealing, handled in a packaged or wrapped condition, a law which prohibits sale of such a commodity in a packaged or wrapped condition unless the contents of the package or wrapping are announced on the exterior of the package or wrapping in a legible fashion is of a regulatory nature. To require such branding for the purposes of sale is not, in my opinion, necessarily a burden on the freedom of the parties to trade and deal in the packaged or wrapped commodity. Within the limits of reason, a law of that nature may specify the size and colour of the lettering which announces the identity of the packaged and wrapped substance. Of course that specification may itself on examination against the background of particular facts show that in truth because of its extent or unreasonableness otherwise in the circumstances it transcends what may reasonably be required for the identification of the contents of a package or wrapping so that the law is not regulatory but its qualified prohibition on sale is a relevant burden on the freedom of the trader. In the present case there is no suggestion that the size, colour or face type of the lettering required on the packages of the margarine is of such a kind that by its very specification it transcends the limits of what might be regarded as regulatory. The packages in which the commodity appears presently to be used in inter-State trade are large enough to bear the letters of the prescribed size, colour and type face. It seems to me that the Act should not be struck down because of the theoretical possibility that traders may hereafter choose to trade in the substance packaged in a way that makes compliance with the Act impractical and burdensome in the relevant sense. I am of the opinion that the law in this instance and in relation to present commercial usage is regulatory in its nature and that it does not impose a relevant burden on the freedom of inter-State trade or commerce. It of course strikes one immediately as somewhat incongruous that the bold lettering which is on the packages of the defendant exhibited in the case should be insufficient for all the relevant purposes of identification to which I have referred, and it does seem somewhat absurd and considerably wasteful that the States of the Commonwealth should not by this time have settled upon some common prescription of the endorsement to be placed on the package of such a substance in common use in trade as margarine. But of course these observations do not touch the legal situation. If the law is regulatory in nature, having in mind the considerations I have mentioned, and the particular specification in the circumstances not beyond reason, the fact that the letters on the defendant's wrapping are smaller by an imperceptible amount—imperceptible for all the practical purposes of those who handle packaged margarine—is beside the point. Consequently, I conclude that s. 24 (a) may validly apply in terms to the sale which has been found to have been made by the defendant. However, in my opinion, the second and third charges cannot be maintained because neither s. 23 nor reg. 6a (6) can, in my opinion, validly apply to the sales the subject of these charges. The claim is made by the State of South Australia through counsel for the complainant that the State is entitled to forbid the sale in South Australia of any manufactured commodity, including the sale by its importer from another State for delivery in a third State, unless the method of manufacture of that commodity conforms to conditions or standards unconnected with health or danger to human life set up by the legislation of South Australia. The instant case is not regarded by counsel for the complainant as in any sense extreme, or that it is founded on any particular considerations solely relating to it, but it is sought to be supported on general universally applicable principles. What the Regulations relevantly provide is that manufacturers in other States of margarine, an ordinary commodity of trade which, though manufactured in different ways by different people, has a sufficiently recognisable essential quality to be described and identified as margarine, must first bring all their ingredients to South Australia or buy them there, submit them to the inspection of the inspectors appointed under the South Australian legislation, then presumably take them to their place of manufacture in another State in the containers marked by the inspectors, and there make margarine only from such ingredients, maintaining evidence that they have done so. Unless these conditions are observed, no person, including the manufacturer, may sell the margarine in South Australia or have it in his possession for sale. It is said that this prohibition does not operate upon any transaction of inter-State trade and that any consequence which it may have for inter-State trade in margarine is but economic. It seems to me that these submissions stem from a misconception of the body of doctrine which has grown up with respect to the meaning and operation of s. 92. It seems to have been thought that because the sales which would fall within the Act and the Regulations would be intra-State sales and because the conditions upon which such sales might take place relate to the process of manufacture, the Act and the Regulations are outside the purview of the constitutional guarantee. No doubt there are cases where, because of the actual provisions of the law under consideration, it must be shown, in order to obtain the protection of the constitutional guarantee, that an identifiable transaction of inter-State trade comes directly within the operation of that law. There are transactions occurring within the State with commodities which have come from or are going to another State which, in relation to the terms of a particular law, are so far removed from inter-State movement as not relevantly to form part of that movement. Also, a quota upon manufacture set by the State in which the manufacture is to take place does not deal with inter-State trade or commerce. In these cases, depending as they do on the particular terms of the legislation under challenge, intra-State transactions will fall outside the protection of s. 92, or the activity upon which challenged law operates is outside the area dealt with by s. 92. But, the law in this case forbids all sale of the commodity unless in compliance with the stated conditions. Generally speaking, the central purpose of inter-State trade and commerce in commodities is their sale in a second State. To forbid the sale of such commodities within the State is, in my opinion, directly to affect the inter-State trade, of which that sale is the end point, not merely by way of economic consequence but by legal command. Though the forbidden sale may be characterized as an intra-State sale, its prohibition directly puts an end to the commercial possibility of inter-State movement in the commodity. A prohibition of all sales of a commodity within a State, unless upon conditions which are regulatory in their nature, is, I should have thought, one of the clearest cases of an infraction of the freedom of inter-State trade. The conditions upon which the prohibition is relaxed are those I have extracted from reg. 6a (6). It needs little reflection to realise that these conditions, as relaxations of the otherwise universal prohibition on sale, are quite illusory so far as they would relate to the commodity in inter-State trade and commerce. The prohibition in reality in relation to that commodity remains absolute. The prohibition and the conditions upon which it appears to be relaxed, in my opinion, clearly constitute a burden upon inter-State trade and commerce. I have no doubt therefore that the prohibition imposed on sale of margarine by reg. 6a (6) cannot validly apply to the sale of margarine which is manufactured outside South Australia and brought there for sale. The Regulations in this respect constitute a direct and gratuitous interference with, and impose an intolerable burden upon, the inter-State trade in the commodity. In my opinion, the same conclusion must be drawn with respect to the statutory provision which founds the third charge: s. 23 of the Act. The inclusion of arrowroot or starch in the margarine is, as I have said, for the mere convenience of a South Australian official in the detection of breaches of the Act and Regulations. In my opinion, the mere convenience of an official in the detection of breaches of an Act can rarely, if ever, be regarded as a proper subject matter of a regulatory provision in reference to inter-State trade. By that very description it appears that the law does not deal with that adjustment of the respective rights of people each to other which is at the foundation of the concept of what is permissible in the field in which s. 92 operates. In my opinion, it is no answer to say that a manufacturer who wants to sell his commodity in a particular State may make up his product in special batches conforming to the particular requirements of that State. A law that woollen garments could not be sold in a State unless the yarn from which they were made contained a blue thread of artificial fibre could not be justified by the ability of the manufacturer to make garments specially with that yarn if he desired to sell for delivery into that State. In my opinion, this provision cannot validly apply to the sale of margarine manufactured outside South Australia and brought there for sale. Accordingly, in my opinion, the defendant should be convicted on the first charge and the other two charges should be dismissed. Taylor and Owen JJ. In these matters, which are removed into this Court pursuant to s. 40 of the Judiciary Act, the complainant proceeds against the defendant in respect of three alleged offences. In this Court the complaints were amended and they now allege: (1) That on 21st June 1965, at a place in South Australia, the defendant sold margarine in a package on which there was not written or printed in bold-faced sans serif black capital letters of not less than 30 points face measurement the word "margarine"; (2) That on the same day and at the same place, the defendant sold table margarine in respect of the manufacture of which records had not been kept as required by reg. 6a (6) of the Margarine Regulations made under the Margarine Act, 1939-1956; and (3) That on the same day and at the same place, the defendant sold margarine of which less than one-tenth of one per centum by weight consisted of dry starch or arrowroot intimately mixed with the other constituents of the margarine. The offences alleged in (1) and (3) above are said to have been constituted by s. 24 (a) and s. 23 respectively of the Margarine Act, 1939-1956 and that alleged in (2) is, as appears from the form of the charge, said to be constituted by reg. 6a (6) of the Margarine Regulations 1930 (as amended). It appears that the defendant carries on in South Australia a business which includes the selling in that State of "Miracle" brand table margarine. However, it does not manufacture that commodity; it imports supplies from New South Wales where it is manufactured by Marrickville Margarine Pty. Limited. It was established that the factual matter alleged in each of the complaints is true; what is said is that the margarine, prepared for sale in packages identical with that in which the margarine in question was sold, was received from the defendant from New South Wales on or about 21st June 1965. There it had been manufactured by Marrickville Margarine Pty. Limited between the 10th and 18th of June 1965 and the margarine, the subject of the complaints, was sold on 21st June 1965. It is now contended that the legislation under which the complaints were laid infringes the provisions of s. 92 of the Constitution or, alternatively, that the legislation does not apply to the sales which the defendant made. Section 24 (a) provides that no person shall sell or have in his possession for sale any margarine in a package unless there is written or printed on the package in bold-faced sans serif black capital letters of not less than 30 points face measurement the word "margarine"; whilst s. 23 provides that no person shall manufacture, sell or have in his possession for sale any margarine unless one-tenth of one per centum by weight of such margarine consists of dry starch or arrowroot intimately mixed with the other constituents of the margarine. It was argued that if these provisions apply to goods in possession for sale or to the sale of goods in the course of inter-State trade they are invalid. But s. 3 (2) of the Act provides that the Act shall be construed subject to the Commonwealth of Australia Constitution Act and so as not to exceed the legislative power of the State, to the intent that, if any provision thereof would, apart from this section, be construed as being in excess of that power, it shall nevertheless be a valid enactment to the extent to which it is not in excess of that power. Consequently, s. 24 (a) and s. 23 must be read down so as to apply only to goods in possession for sale or to the sale of goods in South Australia where the prohibited acts occur outside the sphere of inter-State trade. However, an amending Act in 1941 introduced a new section —s.25a—into the Act which declared that every provision of the Act relating to, inter alia, the sale and having in possession for sale of any table margarine or other substance, the ingredients of table margarine and the authority to make regulations under the Act, shall apply in relation to all table margarine and every such other substance in the State irrespective of whether the table margarine or other substance was or was not manufactured in the State. This, to say the least of it, is a curious provision, but whatever meaning is given to it, it cannot operate to extend the provisions of s. 24 (a) and s. 23 to sales made in the course of inter-State trade. For the prosecution it is contended that the sales, the subject of the complaints, were not made in the course of inter-State trade and, in our view, this contention must be accepted for the course of inter-State trade does not, ipso facto, extend to the first intra-State sale made by the purchasers of goods in the course of inter-State trade (Wragg v. State of New South Wales [1] ). Nevertheless, the defendant contends that the effect of s. 24 (a) and of s. 23, applying as they do to intra-State sales of goods imported into South Australia from other States, is to impose burdens which are obnoxious to s. 92. In this connexion it may be observed that it is not an answer to this contention merely to assert that the impugned sections operate only after the inter-State trade has ceased (Field Peas Marketing Board (Tas.) v. Clements & Marshall Pty. Ltd. [1] and Wragg's Case [2] ). 1. (1953) 88 C.L.R. 353. 2. (1948) 76 C.L.R. 414. 3. (1953) 88 C.L.R. 353. There is, we think, a great deal to be said for the defendant's contention in relation to the provisions of s. 23. It is common ground that if a minute quantity of dry starch or arrowroot is to be mixed intimately with the other constituents of margarine it must be done at the point of manufacture; it cannot be done at any later stage. The effect of the section is, therefore, to prohibit absolutely the sale of margarine in South Australia, including margarine imported from another State, which does not conform to the statutory requirement. Upon the evidence s. 23 cannot be justified as a provision concerned with the safeguarding of public health; it is merely a provision intended to enable a simple test to be made in order to establish that the product contains dry starch or arrowroot and, presumably, that it is not butter. But the direct effect of the section is to put an end to trade in margarine between South Australia and other States where the margarine is imported into South Australia for the purpose of resale if the margarine does not conform to the requirements of s. 23. So far as the defendant is concerned it was, it was said, free to import the margarine in question here into South Australia from New South Wales but since, admittedly, it was not possible for it to correct the lack of conformity with s. 23, the effect of the section in the circumstances was, for all practical purposes, to destroy the inter-State trade in the commodity. To our minds it is merely a matter of words to say that the defendant was free to import the margarine into South Australia from New South Wales for the moment it had it in its possession for sale in the former State, or the moment it sold it in that State, it would commit an offence. To our minds it is about as clear as it can be that, in these circumstances, s. 23 operated directly to terminate its inter-State trade in margarine. This being so, to give s. 23 its full effect in relation to intra-State sales would be to give it an operation which infringes s. 92. Accordingly, the complaint alleged under that section should be dismissed. The complaint alleged under s. 24 (a) presents features which distinguish it from the first complaint. This section relates to packaging and it is, we think, impossible to deny to a State the right to legislate that margarine may be sold in the course of intra-State trade in that State only if it is contained in a package which bears an appropriate inscription. Within reason and as a general rule it is, of course, for the legislature to determine what shall be regarded as appropriate. In this case there was substantial, though not literal, compliance with s. 24 (a). The word "margarine" was printed on the package in bold-faced sans serif but it is said that the letters were of less than 30 points face measurement. In fact, the evidence shows that they were of 24 points face measurement and, therefore, one-twelfth of an inch less in height than the section required. It was also alleged that the word was not printed in black letters; it is said, in effect, that if held at certain angles the letters appear to be dark blue. But the printing, in general, appears black and the lack of conformity is quite insignificant. However, we do not think that the provisions of s. 24 (a) limited as they must be to transactions occurring outside the realm of inter-State trade, infringe the provisions of s. 92 and the complaint alleging this offence should, in our opinion, be remitted to the magistrate for the purpose of dealing with this trivial contravention. As already appears the third complaint was laid under reg. 6a (6) of the Margarine Regulations. This regulation, which was formulated shortly after the introduction into the Act of s. 25a, was characterized by counsel for the complainant as "a piece of slovenly drafting". But this is, to say the least, an understatement for a more confusing and unintelligible piece of legislation it is scarcely possible to imagine. Its opening words are: "The following provisions shall apply to the manufacture or sale of table margarine in South Australia". Then follow eight sub-regulations. The first of these merely provides that the expression "table margarine" shall have the meaning assigned to it by the Act. The second and subsequent sub-regulations make it quite clear that, at least, some of its provisions apply to all margarine whether manufactured in South Australia or elsewhere. Examination of sub-reg. (2) reveals that it contains two sets of provisions contravention of either of which constitutes an offence under the Act. The first set requires that all ingredients, used in the manufacture of table margarine, shall be submitted for inspection by an inspector before such ingredients are used in the manufacture of table margarine, and the second, that no table margarine (whether manufactured in South Australia or elsewhere) shall be sold or offered for sale or placed on the market in South Australia, unless, prior to manufacture, the ingredients thereof have been submitted for inspection and approved by an inspector, in accordance with the Regulations. Prima facie we should have thought that the positive obligation under this sub-regulation to submit all ingredients for inspection extended only to manufacturers in South Australia and that the second set of provisions was intended to apply to the sale or offering for sale of margarine wherever manufactured and this, we think, is its true meaning. Sub-regulations (3) and (4) go on to provide that, in the case of a manufacturer who holds a licence under the Margarine Act, 1939-1941, that is to say, one who manufactures margarine in South Australia, the ingredients of table margarine shall be submitted for inspection on the premises specified in the licence held by him (sub-reg. (3)) and that where table margarine, which is manufactured outside South Australia, is sold or offered for sale or marketed in South Australia, or is intended so to be, the ingredients shall be submitted for inspection and inspected, at an inspection depot in South Australia provided by and at the expense of the manufacturer and approved by the Minister. The offence created by the latter part of sub-reg. (2) is constituted by the sale or offering for sale in South Australia of margarine wherever manufactured unless, prior to manufacture, the ingredients thereof have been submitted for inspection and approved by an inspector. But sub-reg. (4) is couched in language which is apt to impose upon a manufacturer in another State a positive obligation to submit the ingredients of his margarine for inspection if the margarine is sold or offered for sale in South Australia, or, is intended so to be. As we understand the effect of these sub-regulations the offence under sub-reg. (2) is the sale or offering for sale in South Australia of margarine unless, prior to manufacture, its ingredients have been submitted for inspection, whilst under sub-reg. (4) an offence is committed when the manufacturer manufactures margarine which is intended to be sold or offered for sale in South Australia and fails to submit the ingredients for inspection. Further, it seems that the manufacturer in another State retrospectively commits an offence if margarine of his manufacture, though not manufactured for the purposes of sale in South Australia, is sold or offered for sale in that State by any person and the manufacturer has not submitted the ingredients thereof for inspection. The provisions of sub-reg. (6) are curious in the extreme. It is in the following terms: "No person shall sell, offer for sale, or place on the market in South Australia any table margarine unless, in respect of the manufacture thereof, records have been kept showing:—(a) that the ingredients thereof have been submitted for inspection and approved by an inspector in accordance with these regulations: (b) the time when and the person by whom such ingredients have been submitted as aforesaid, and the date of such approval: (c) the quantities of each ingredient approved as aforesaid: (d) satisfactory evidence that the said table margarine sold, offered for sale, or placed on the market in South Australia has been manufactured solely from ingredients all of which have been approved pursuant to these regulations." The regulation as a whole provides, in language that clearly refers to any sale in South Australia, whether in the course of inter-State trade or not, that no margarine shall be sold in South Australia unless the ingredients thereof have been submitted for inspection at a place established and maintained at the expense of the manufacturer and approved by the Minister. Following the earlier provisions of the regulation sub-reg. (6) constitutes it an offence for any person to sell, offer for sale, or place on the market in South Australia any table margarine unless, in respect of the manufacture thereof, the specified records have been kept. But one may ask by whom are such records to be kept? Clearly enough, we should think, by the manufacturer. Yet under sub-reg. (7) any person who sells, offers for sale or places on the market in South Australia, any table margarine, may be required to produce the records mentioned in sub-reg. (6). This obligation, it will be seen, is placed not only on the manufacturer but on any person who sells margarine in South Australia and one may well inquire how a person of the latter class can ever be in a position to produce the records to which sub-reg. (6) refers, or cause them to be produced. Finally, sub-reg. (8) provides that every manufacturer who sells, offers for sale, or places on the market in South Australia any table margarine (whether manufactured in South Australia or elsewhere) shall furnish a return to the Minister once in every calendar month setting out the particulars required to be kept pursuant to these regulations. It seems to us that the regulation, as a whole, does, at many points, impair, and intends to impair, the freedom of inter-State trade. The requirement that no margarine, whether manufactured in South Australia or elsewhere, shall be sold or offered for sale in South Australia, unless, prior to manufacture, the ingredients have been submitted for inspection and unless the specified records have been kept by the manufacturer, is obnoxious to s. 92, and it seems that these provisions apply and were intended to apply to sales in South Australia whether in the course of inter-State trade or not. There are, in our view, other provisions in sub-reg. (6) which also impair the freedom of inter-State trade and it appears to us that they were framed on the view that s. 25a, which had recently been introduced into the Act, had a full operation according to its tenor and that it authorized the making of regulations applicable to all table margarine irrespective of whether that table margarine or other substance was or was not manufactured in South Australia. In our view, it is quite impossible to read down sub-reg. (6) so as to confine it within permissible legislative limits and, accordingly, it must be held to be invalid. It follows that the complaint in respect of this alleged offence must be dismissed. Menzies J. I need not repeat what other members of the Court have already said in defining what here falls to be decided. I will do no more than state shortly my conclusions upon the questions of the validity of the statutory provisions which the defendant impugns. In my opinion, s. 24 of the South Australian Margarine Act, which forbids the sale of margarine in a package unless labelled in a particular manner, is a law which, in the absence of special circumstances, could validly apply to sales of margarine in the course of inter-State trade. A fortiori it validly applies in ordinary circumstances to intra-State sales of margarine after its importation into South Australia from another State. Section 23 of the Act, which requires margarine sold, or offered for sale, in South Australia to have been adulterated with dry starch or arrowroot, is, so far as I can see, a law which serves no sensible purpose, notwithstanding that a simple chemical test can be applied to determine the presence of starch or arrowroot in a sample of a substance. If there be some other law which forbids a like adulteration of butter sold, or offered for sale, in South Australia and if it be assumed that there will be strict compliance with each law, then no doubt the presence, without more, of the additive in a sample of a substance which may be butter or margarine would indicate that the substance is margarine, whilst the absence of the additive would indicate that the substance is butter. It seems to me, however, that the reason for some simple chemical way of distinguishing between margarine and butter is the apprehension that laws will not be strictly obeyed. In the circumstances, I have found it necessary to be on my guard lest I should too readily treat what is an officious requirement as an unlawful exercise of power. It seems to me that a law requiring all margarine manufactured in South Australia to contain starch or arrowroot would not interfere with inter-State trade, notwithstanding that there are customers in other States who want to buy margarine, containing no starch or arrowroot, from South Australian manufacturers. This, I think, follows from the decisions of this Court in Grannall v. Marrickville Margarine Pty. Limited [1] and Beal v. Marrickville Margarine Pty. Limited [2] . By like reasoning, I have reached the conclusion that the South Australian law which, no doubt, makes it practically necessary for manufacturers of margarine in other States to add starch or arrowroot to margarine which they are manufacturing for export to South Australia is not a law which interferes with inter-State trade. It operates after inter-State trade (Wragg v. State of New South Wales [3] ) to influence conduct before inter-State trade (Beal v. Marrickville Margarine Pty. Limited [2] ; Williams v. Metropolitan and Export Abattoirs Board [4] ). In the latter case, Kitto J. said:—"If a law operates directly upon sales of goods, and it is found that goods of the kind to which the law refers cross State boundaries at some stage of their journey to the hands of a purchaser, the question whether the law operates directly or only consequentially upon inter-State trade depends upon the further question whether sales affected by the law are so inseverably bound up with the inter-State movement of the goods sold that together they constitute an example of inter-State trade. If it is only as a repercussion depending upon practical business or economic considerations that an effect upon the inter-State movement will follow when the law makes its impact upon the sales, the law cannot be said to burden inter-State trade by its direct operation, and it therefore cannot be in collision with s. 92" [5] . I think, therefore, that s. 23 validly applies to the sale in South Australia of margarine manufactured in New South Wales. Different considerations might apply to a general law forbidding the sale in a State of a commodity unless it contain something which would render it unsaleable for its ordinary trade purpose. 1. (1955) 93 C.L.R. 55. 2. (1966) 114 C.L.R. 283. 3. (1953) 88 C.L.R. 353. 4. (1966) 114 C.L.R. 283. 5. (1953) 89 C.L.R. 66. 6. (1953) 89 C.L.R., at p. 75. As to the third matter, I agree with the other members of the Court that reg. 6a (2) (4) and (6) of the Margarine Regulations cannot, by reason of s. 92 of the Commonwealth Constitution, validly apply to margarine manufactured in States other than South Australia. The regulation in question attempts, by means of the imposition of impossible requirements relating to manufacture in States other than South Australia, to exclude from sale in South Australia margarine manufactured in those other States. Windeyer J. In this case, removed into this Court, the defendant is charged with three separate offences. In each case the defence is that the provision of the Margarine Act, 1939-1956 S.A. or of the regulations made thereunder on which the charge is founded is invalid as in conflict with s. 92 of the Constitution. The first charge is under s. 24 (a) of the Act. This provides in effect that packages of margarine for sale shall have the word "margarine" printed on them in black letters of the size and kind it prescribes. The section must, I think (having regard to ss. 3 (2) and 25a), be limited to persons selling margarine in South Australia for delivery there or having it in their possession there for sale and delivery there. It does not, as I read it, extend to selling margarine in South Australia for delivery in another State. But it does apply to selling or having in possession for sale in South Australia margarine imported from elsewhere. It is necessary, therefore, to consider what the practical consequences of its requirements may be in order to determine whether or not enforcing obedience to them would be contrary to the freedom that s. 92 protects. A general purpose and policy behind the Margarine Act is, no doubt, to aid and protect the dairy industry in the contest between butter and margarine. But, as the Chief Justice recently said, "It is not enough that there are perceptible reasons for the enactment of the law valid enough in the eyes of a legislature pursuing some policy conceived by it to be for the public good or the general welfare": Harper v. State of Victoria [1] . The Constitution declares freedom of trade, commerce and intercourse among the States to be an overriding good, to be overwhelmingly for the general welfare. But just as purposes and intentions conceived by a legislature to be good cannot destroy the operation of s. 92, so its operation is not to be enlarged to destroy all statutory regulation of trade that traders may find irksome or obedience to which is costly for them. The intentions of the legislature, whether considered good or bad by dairyman or margarine makers, cannot determine whether the enactment is constitutionally good or bad. It is what the Act does, not why it was passed, that counts. Now s. 24 (a) ensures that packages of margarine sold or kept for sale must be plainly and boldly marked with the name of their contents. To insist on this is not to impose an impediment on honest trade and commerce. What s. 92 protects is trade and commerce that is honestly conducted. No honest trader can object to a requirement that his wares be marked by their proper name and sold under that description. Section 24 (a) prescribes what the legislature considers necessary to ensure plain and legible marking. It cannot I think be said that it is not a reasonable prescription for that end. In the present case the requirement was not complied with. The word "margarine" plainly appears on the package in large and legible print which only a busybody would say was not black. However, the letters fall short of the prescribed height by one twelfth of an inch. An offence was thus committed although it seems a harmless one. The defendant must be convicted. 1. (1966) 114 C.L.R. 361, at p. 375. So much for s. 24 (a). It helps to ensure that buyers of commodities get what they want and what they pay for—that those who want margarine get margarine not butter; that those who want butter do not get margarine. The next question is whether the same considerations apply to s. 23. It provides that no person shall manufacture, sell or have in his possession for sale any margarine unless one-tenth of one per centum by weight of such margarine consists of dry starch or arrowroot intimately mixed with the other constituents of the margarine. It too must be read with the limitations imposed by ss. 3 (2) and 25a in mind. So read, it applies to the selling of margarine in South Australia for delivery there or to the having margarine in possession there for such sale. That is to say it does not extend to selling margarine or having margarine for sale in the course of inter-State trade. But it does apply to any margarine, wherever made, sold or kept for sale in South Australia. And, as the requirement that the starch or arrowroot be intimately mixed with the other constituents can only be complied with during the process of manufacture, it means that margarine wherever made must, if it is to go upon the market in South Australia, be adulterated by the maker with the stipulated modicum of starch or arrowroot. A person in South Australia who buys margarine from another State for sale in South Australia may possibly have to pay more in order to obtain margarine that he can be assured would satisfy the requirements of South Australian law than he would for other margarine. I shall assume this may be so. But it does not determine the question. I do not think that it can be said in the abstract that a State law prescribing qualities and standards for particular kinds of goods to be sold within a State or things to be used there necessarily offends s. 92. The question cannot be usefully considered apart from the facts of a particular case. In the present case the requirement that starch or arrowroot be in margarine sold in South Australia is unrelated to any quality of margarine as a foodstuff. Its presence is not detectable by the housewife. But it is detectable by a simple process of analysis. That explains the law. If complied with, it enables margarine to be distinguished from butter. A substance that contains starch or arrowroot is presumptively not butter, because butter factories do not ordinarily add starch or arrowroot to their product. Section 23 thus makes passing off of margarine as butter or of butter as margarine easier to detect. That seems to be its purpose. I have had some doubts whether some indirect consequences might make it offensive to s. 92. But on the whole I think it is merely regulatory of the trade in margarine not restrictive of it. I would convict the defendant on this charge. The third charge is for a breach of reg. 6 made under the Act. The regulation is obscurely worded. But I do not find it necessary to discuss its proper construction because on any meaning that it can fairly bear it seems to me that its enforcement would amount to an unconstitutional impediment to inter-State trade. I agree in what has been said by my brothers Taylor and Owen on this aspect, and for that reason I do not think it necessary to say more. The charge under the regulation should be dismissed. The following further reasons for judgment were delivered by the Court: Oct. 14 Barwick C.J., Taylor, Menzies, Windeyer and Owen JJ. The Court delivered judgment in this matter in Sydney on 9th September but at the request of the parties reserved the question of costs. Since that time each party has furnished the Court with written submissions as to the order for costs which ought to be made having regard to the order made by the Court in the prosecutions. Having considered the matters placed before it by the parties, the Court is of opinion that the complainant should bear two-thirds of the respondent's costs of proceedings in this Court. The order of the Court will therefore be that the complainant pay two-thirds of the respondent's costs of the proceedings in this Court including the proceedings taken to remove the prosecutions into this Court.